The PORAC Retiree Medical Trust is, as they say, somewhat of a different animal. And different comes with challenges. 

We are an ERISA trust. The acronym stands for Employee Retirement Income Security Act, something that got its start in 1974 (curiously, the same year that the Peace Officer Bill of Rights began to grow legs). The act was basically legislated to eliminate what was often referred to as “bad boy” clauses. The idea was to protect workers from losing their accrued, nonforfeitable benefits for something as simple as being discharged for cause by the employer. Or quitting and going to work for a competitor. It seems that many employers took full advantage of firing employees who were nearing the date of their retirement. Getting rid of the employee would relieve the employer of the burden of having to pay out on those promised benefits. It was truly a keen piece of legislation and went a long way toward protecting employee rights. And I like that a lot.

Often, we are referred to as a VEBA plan, which stands for voluntary employees’ beneficiary association. Ours is basically a post-employment VEBA, designed to help fund medical benefits once an employee retires and separates.

The government allows us to take advantage of extremely large tax breaks, making it somewhat of a core tenet for our existence.

When a participant isn’t able to hang around long enough to qualify for a lifetime benefit, we convert their contributions to an individual account. There is no age requirement to attain before accessing the benefit. Once they leave their employer, they can tap into that account. And there are many reasons for leaving, including both regular and medical disability retirement, changing careers, forced separation, probation failure and a lateral move to another agency.

It’s all good stuff, and the RMT has been steadily growing as it becomes more and more evident that medical costs continue to skyrocket, typically outpacing inflation.

The Internal Revenue Service and the Department of Labor have many rules and regulations by which we must operate. One of them is the obligation to find missing participants. I like to call them MPs. Our simple calculation is you become missing when mail that we sent you is returned as undeliverable. That happens when a participant moves and fails to notify us of a change of address. Finding our missing participants is directly synonymous with “business expense.” We have to pay a skip tracer to beat the bush and connect us with our MPs. It has always irritated me that they would get paid for their attempts as opposed to their level of success. That business model just doesn’t seem to inspire proven results.

This year, our list of MPs (most with individual accounts) was fast approaching 500. Cops are pretty good at hiding when they don’t want to be found. But hey, don’t forget that we are the good guys and we need to be able to connect with you.

I decided that this year we had to do a much deeper dive. We had to drill down and find people. And so, we began the search in earnest. Using a wide variety of methods, we dove in headfirst.

As I was placing calls and making inquiries, it was really exciting when I found folks who we had lost contact with. It was most enjoyable to share with them that they had a benefit with the RMT that could be used to reimburse them for medical expenses. Surprisingly, many were unaware that while employed and fighting crime and fires, they were also building up a benefit in their account.

The size of those accounts varied wildly. Sometimes it was small, just a few hundred dollars. Those were folks who only stuck around for a very short time and then moved along. Others had significantly more money — thousands.

I can confirm for you that cold calling someone and informing them that they have a large chunk of tax-free money available to them generates some genuine excitement. The number one question they had for me was this: “Terry, can I use the money to pay for my kid’s braces?” The answer is absolutely. This happened at least a dozen times. One MP had just forked over $4,500 for braces to be fitted on two of his young children. His account was going to be able to cover that with some left over. I could see the smile on his face over the phone.

Time and time again, over and over, I had the pleasure to share with them that they were going to experience a bit of Christmas in February. And along the way, we had great conversation. We talked shop. I made a lot of new acquaintances. I had the pleasure. I would have enjoyed working with these folks.

The Retiree Medical Trust works — for you, your spouse and your dependent children. We would love to share the program with you. Give me a call at (530) 588-5117 and I will arrange it.