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Barron v. State Health Benefits Commission

August 23, 2001

ROBERT BARRON, APPELLANT,
v.
STATE HEALTH BENEFITS COMMISSION, RESPONDENT.



Before Judges Skillman, Wecker and Lesemann.

The opinion of the court was delivered by: Skillman, P.J.A.D.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued by telephone February 23, 2001

On appeal from the State Health Benefits Commission.

The issue presented by this appeal is whether appellant Robert Barron, who was a member of three different State pension systems during the thirty-one years he was employed by various local school districts and State institutions of higher learning, is entitled upon retirement to the same free medical coverage under the State Health Benefits Program (SHBP) as a retiree who was a member of the same State pension system during the entire course of public employment of twenty-five or more years duration.

Appellant was employed as a teacher in Middle Township High School for five years from the late 1950s to the mid 1960s during which he was enrolled in the Public Employees Retirement System (PERS). He then taught for twelve years at Rutgers University, during which time he also was enrolled in the PERS. As a result, he accumulated a total of seventeen years service credit in the PERS.

In 1981, appellant began teaching at Stockton State College. At that time, he transferred from the PERS to the Alternate Benefit Program (ABP), under which employer and employee contributions are used to purchase private retirement benefit contracts for members. When appellant transferred from the PERS to the ABP, he transferred his accumulated PERS deductions as well as the PERS reserves required to fully fund his pension from the PERS to the ABP. Appellant continued his employment at Stockton until 1986.

Beginning in 1989, appellant was employed as a teacher at Wildwood High School. At that time, he was no longer eligible to participate in the ABP but was instead required to become a member of the Teachers' Pension and Annuity Fund (TPAF). Appellant retired from this position in 1998.

Upon his retirement, appellant was awarded a retirement benefit from the TPAF based on nine years and three months of service credit. In addition, appellant is eligible to receive benefits under his ABP private retirement benefit contract.

When he retired, appellant also sought the benefit of the free medical coverage under the SHBP that is provided to a member of the TPAF or other State-administered pension system after twenty-five years of creditable service. However, the State Health Benefits Commission (SHBC) rejected appellant's claim on the ground that the statutory provisions authorizing this benefit do not "permit an aggregation of service credit in various pension systems" in determining eligibility.

Appellant appeals from this determination. We conclude that the appellant is entitled to free medical coverage under the SHBP because he has more than twenty-five years of aggregate service credit in the ABP and TPAF.

N.J.S.A. 52:14-17.32f provides that "[a] qualified retiree from the [TPAF]" and his or her dependents are entitled to free medical coverage under the SHBP. "A qualified retiree" is defined as including a member of the system "[r]etired on a benefit based on 25 or more years of service credit." N.J.S.A. 52:14-17.32f(a).

The same benefit is available to retirees in other State- administered retirement systems. N.J.S.A. 52:14-17.32(c)(1) provides that free medical coverage shall be provided to any "retired State employee and his dependents covered under [the SHBP] . . . if such employee retired from a State-administered retirement system on a benefit based on 25 years or more of service credited in such system." N.J.S.A. 52:14-17.32f1(a) extends this benefit to "any employee of a board of education who retires on a benefit based upon 25 or more years of service credit in the [PERS]."

The SHBC acknowledges that appellant would be entitled to free medical coverage under these provisions if he had retired with twenty-five years of service credit in the TPAF, ABP or PERS. See N.J.A.C. 17:9-6.1(b)(3)(iii). However, the SHBC concluded that because appellant did not have twenty-five years of ...


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