Could New Orleans City Park employees keep state group health coverage by retiring directly into Social Security?

Plain-English summary

Mr. D. Digges Morgan III requested an opinion on whether Social Security could qualify as the governmental retirement plan required for continued Office of Group Benefits coverage. The AG said covered employees could continue coverage if they retired directly from active Association employment and immediately began receiving Social Security benefits. It adopted the benefits office counsel's interpretation that Social Security fit the then-existing rule in this narrow setting.

The opinion emphasized both timing conditions. An employee could not leave active employment and defer Social Security while continuing retiree coverage under the rule described. The correspondence quoted in the opinion also said future legislation or new rules might clarify or narrow eligibility.

Currency note

This opinion was issued in 2005. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here.

Common questions

Did Social Security qualify for this coverage rule in 2005?

The AG concurred with the benefits office's view that it did for the City Park Association employees described, given the rule then in force.

Could an employee retire and begin Social Security later?

The AG said no under the cited interpretation. The person had to move directly from active covered employment to immediately receiving Social Security benefits.

Was prior Office of Group Benefits coverage required?

Yes. The rule quoted in the opinion defined a retiree as someone covered immediately before retirement.

Background and statutory framework

LSA-R.S. 42:808 addressed eligibility for Office of Group Benefits programs. The AG deferred to the office's interpretation of its retiree rule, which referred to immediate benefits from an approved governmental defined plan. It noted that the office had not adopted an approved-plan list and that its counsel treated Social Security as qualifying in the stated circumstances.

Citations

• LSA-R.S. 42:808 (group-benefits eligibility).
• Office of Group Benefits retiree rule quoted in the opinion (immediate benefit requirement).

Source

• Landing page: https://www.ag.state.la.us/Opinions
• Original PDF: https://www.ag.state.la.us/Opinion/Download/04-0042

Original opinion text

February 2, 2005
Opinion Number 04-0042

LSA-R.S. 42:808
92-A-2-(g) RETIREMENT – State Employees
Mr. Patrick J. Butler, Jr., President
54 INSURANCE
Board of Commissioners
New Orleans City Park Improvement Association Pertains to the eligibility of New Orleans City Park Improvement Association employees to continue
1 Palm Drive
health coverage through the Office of Group Benefits
New Orleans, Louisiana 70124-4608
after retirement.

Dear Mr. Butler:

Reference is made to the request of Mr. D. Digges Morgan III for an opinion of this office regarding the eligibility of certain retirees of the New Orleans City Park Improvement Association (the “Association”) to maintain health insurance coverage with the State of Louisiana’s Office of Group Benefits after retirement. Specifically, you seek our opinion as to whether social security benefits constitute “retirement benefits from an approved state or governmental agency defined benefit plan” such that Association employees who are currently covered by the Office of Group Benefits and who are participants in Social Security will be eligible to maintain that coverage into their retirement.

LSA-R.S. 42:808, relative to eligibility for Office of Group Benefits programs, pertinently provides:

“A. For the purposes of participating in life, health, or other programs sponsored by the Office of Group Benefits, an employee is defined as:

(1) A classified or unclassified state civil service employee.

(2) A retiree as defined by the rules and regulations of the Office of Group Benefits...”

In accordance with the rules and regulations of the Office of Group Benefits:

“Retiree means an individual, who was a covered Employee immediately prior to the date of retirement and who, upon retirement,

1. immediately received retirement benefits from an approved state or governmental agency defined plan; or, …”

Page 2

Opinion Number 04-0042
Mr. Patrick J. Butler, Jr., President
Board of Commissioners
New Orleans City Park Improvement Association
Page -2-

In connection with your request Ms. Pamela Miller Perkins, General Counsel to the Division of Administration, has provided us with a Memo dated July 14, 2004 from Mr. Stanley K. Hurder, Deputy General Counsel to the Office of Group Benefits, regarding the very issue which is the subject of your request. A copy of Ms. Perkins’ correspondence, also dated July 14, 2004, and the Memo provided are enclosed herewith. Pertinently, Ms. Perkins correspondence states:

“At this time the Office of Group Benefits has not adopted extensive rules to define retirement eligibility. It is anticipated that either legislation or additional rules and regulations may be adopted to clarify the definition of eligible retiree, which might exclude individuals who receive a Social Security benefit…However, at this time it appears that the employees of the New Orleans City Park Improvement Association are probably eligible to continue coverage into retirement status.”

In pertinent part, Mr. Hurder’s Memo states:

“…the Social Security Administration appears to be a “governmental agency defined plan”. Payments to the retiree are defined in accordance with prior earnings records, just like the standard LASERS or other state plan. OGB has not developed a list of approved plans, so in this narrow set of circumstances, it appears that the SSA Social Security benefits plan constitutes a governmental agency defined plan. The rule requires that the active employee immediately receive the retirement benefits following retirement. Thus, the employee could not retire and continue coverage unless he or she is immediately eligible for Social Security benefits.”

In summary, Mr. Hurder’s Memo states:

“...Association employees are state employees eligible for OGB membership. This eligibility for retiree coverage provided the person retires directly from active employment to the Social Security governmental agency defined benefit plan.”

The Memo also quotes from a letter dated September 20, 2001 (copy enclosed), wherein Mr. A. Kip Wall, Chief Executive Officer of the Office of Group Benefits stated:

“If Social Security is considered to be the approved governmental agency defined benefits plan, then the employees of New Orleans City Park must be covered immediately prior to retirement and must, upon retirement, immediately begin receiving Social Security benefits. Any other scenario will not meet the definition.”

Page 3

Opinion Number 04-0042
Mr. Patrick J. Butler, Jr., President
Board of Commissioners
New Orleans City Park Improvement Association
Page -3-

This office concurs in the analysis and result reached in the documents enclosed herewith, particularly Mr. Hurder’s Memo of July 14, 2004. Accordingly, it is the opinion of this office that Association employees who are currently covered by the Office of Group Benefits, and who are participants in Social Security will be eligible to maintain Group Benefits coverage into their retirement provided the employee retires directly from active employment with the Association and immediately begins receiving the benefits of Social Security.

In reaching our determination herein, we have deferred to the Office of Group Benefits and its Counsel with respect to the interpretation of the Office of Group Benefits’ rules and regulations. In accordance with the doctrine of contemporaneous construction, the interpretation given to a law or regulation by those charged with its execution and/or implementation is entitled to great weight. Esso Standard Oil Co. v. Crescent River Port Pilot’s Association, 106 So.2d 316 (La. 1958); State v. B. P. Exploration and Oil, Inc., 506 So.2d 528 (La. App. 1st. Cir. 1997); Danna v. Commissioner of Insurance, 228 So.2d 708 (La. App. 1st. Cir 1969).

We trust the foregoing to be of assistance. Please contact this office if you have any comments or questions in this regard.

Yours very truly,

CHARLES C. FOTI, JR.
Attorney General

BY: _________
JEANNE-MARIE ZERINGUE BARHAM
Assistant Attorney General

CCF, jr./JMZB/dam

Attachments

xc: A. Kip Wall, Office of Group Benefits Pamela Miller Perkins, Division of Administration Stanley K. Hurder, Office of Group Benefits

Page 4

Opinion Number 04-0042
Syllabus

LSA-R.S. 42:808
92-A-2-(g) RETIREMENT – State Employees
54 INSURANCE

Pertains to the eligibility of New Orleans City Park Improvement Association employees to continue health coverage through the Office of Group Benefits after retirement.

Mr. Patrick J. Butler, Jr., President
Board of Commissioners
New Orleans City Park Improvement Association
1 Palm Drive
New Orleans, Louisiana 70124-4608

Date Received:

Date Released: February 2, 2005

Jeanne-Marie Zeringue Barham
Assistant Attorney General