BN - Health Opt-Out Incentive Business Process

Effective January 1, 2016, UW employees who are covered under the State Group Health Insurance program may be eligible to receive $2,000 by opting out of the program. This KB describes the business process for documenting the employee opt-out decision.

Procedure At-A-Glance
Category: Data Change
Audience: Institution Benefit Administrators; Affinity Groups; UW Service Center Benefits Team
Overarching Process: State Group Health - Health Opt Out
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General Description

This procedure covers the Health Opt-out Incentive business process.  The Department of Employee Trust Funds (ETF) and the Department of Administration -Division of Personnel (DPM) have provided the following guidance regarding the health Opt Out Incentive option.

warning sign Craftworkers, and employees covered under the Grad/Short-term Academic Staff benefit programs, are not eligible for the $2,000 incentive, even if they decline coverage.

Process Inputs

Employee Actions

  • Employee completes the Health Insurance application, (ET-2301) electing to opt-out of health insurance.
  • Employee's application needs to be received within 30 days of Date of Hire. 

warning sign  Employees may not opt-out using eBenefits.

Process Outputs

  • UWSC and ETF determine opt out eligibility.

Process Considerations

  • Full and part-time employees under the Wisconsin Retirement System who are enrolled in the State Group Health Insurance program in 2015 are eligible for the $2,000 opt-out incentive for coverage in 2016.  An employee is NEVER eligible for health opt out if they were eligible for health insurance but declined health benefits in 2015.
  • An employee is not eligible for health opt out if they are currently a dependent under the Health Insurance program.
  • If an employee is on LOA, you need to follow the same guidelines of LOA as if they were enrolled in health insurance – ie if an employee is on full paid LOA they are eligible for health opt out the whole time.  If they are on an unpaid LOA they are eligible for health opt out for the first three months and then they would not be eligible (as ER contributions would cease at that time if they were enrolled in health). They would be allowed back into Health Opt Out when they return to work.  There is not an enrollment opportunity back into Health Insurance when they return from LOA (as this is based on change in premium cost to EE).
  • If a GRAD declined coverage in 2015, this does NOT negate their eligibility for health opt out.  They were never in a Health Opt Out eligible employment, therefore their declined status cannot affect their eligibility.
  • If an employee receives health insurance through the state at any point during a year, they are not eligible for Health Opt Out until the next year IYC. 
  • If we give an employee too much in Health Opt Out, we should try to get the extra incentive back, either through paylines on their last paycheck or through Benefit Billing.

Employee & Employer Share - Incentive Schedule


Procedure Steps:

Institution Process:

  • Institution verifies that the employee completes the following sections of the health application:
    • Section 1: Applicant Information
    • Section 2: Spouse/Domestic Partner Information
    • Section 4: Choose to Decline/Waive Coverage box is checked
    • Section 14: Decline Health Insurance and Elect the Opt Out Incentive marked YES
    • Section 15: Employee signature and dated
  • Institution completes Section 16 for with Employer Information.
  • Benefit Administrators should be entering information from Section 11 and 12 into HRS - Benefits Personal Data Page.
  • Institution faxes completed Health Insurance Opt Out checklist and State Group Health application to UWSC Benefits Team.

UWSC Process:

  1. Do initial verification
  2. Create WISCIT with Empl ID, Empl Name and Opt Out Verification
  3. Email ETF to verify eligibility
Send email to institution, who then reaches out to employee with the denial decision 


Send email to institution, who then reaches out to the employee with approval decision
If University Staff, eligible once ER contributions would begin
Create ADM event to enroll in OPT OUT Health Plan
Verify benefits are correct due to ADM event processing

Reconcile incentives
Enter an ADM event with new benefit information

Related Policies, Job Aids and Forms

Related Policies

Related Forms

    Related Job Aids

    Keywords:statutory SBC cancel waive opt out opt-out health incentive IYC new hire it's your choice SGH state group health optout   Doc ID:57671
    Owner:Samantha Q.Group:Human Resource System (HRS)
    Created:2015-10-21 13:21 CSTUpdated:2016-11-29 16:18 CST
    Sites:Human Resource System (HRS)
    Feedback:  0   0