A Guide to the Retiree Medical Trust
What is the RMT?
The PORAC Retiree Medical Trust is a funding vehicle in which you can deposit money while you are working to pay for medical expenses after you retire.
The Trust provides reimbursement benefits toward the cost of the following for eligible retirees:
- Medical expenses for prevention, diagnosis and treatment, including prescription drugs and insulin
- Health, dental or vision insurance premiums and payments
- Long-term care insurance premiums
How it Works
- Pre-tax employer and/or employee contributions are made through regular payroll transfers and/or lump-sum transfers of sick and vacation leave.
- The Trust uses investment professionals to invest your contributions, and there is no tax on the earnings.
- Once you retire, the Trust functions as a medical premium and expense reimbursement plan, and the benefits are totally tax-free.
- The Trust is similar in many ways to your retirement plan; the longer you work, the greater your benefit will be.
How to Join
- Any California PORAC member association may choose to join the Trust as a bargaining unit (through collective bargaining). No individual employee can join the trust.
- Unions and employers must negotiate a set contribution rate.
- As of January 2021, Police and Fire associations in all states are eligible to participate.
Eligibility for monthly benefits is determined by:
- Earning five years of active service (10 years for employees hired after their association joined the Trust)
- Having contributions made to the Trust on your behalf for all years of active service
- Attaining age 55
- Ceasing employment with any participating group in the Plan