$50 monthly contribution = 1 Active Service Unit
Unit Multiplier,1 effective October 1, 2021 = $0.77
Example #1 – 6 years in Trust: An Association has a contribution rate of $100/month, and Employee Jones participates for two years (or 24 months) at that level. Then the Association increases the contribution rate to $150/month, and Jones participates for four years (or 48 months) at that level, and then retires. The monthly amount available to Jones for medical expense reimbursement will be calculated as follows:
Step 1: Convert monthly contributions to Active Service Units
$100/month = 2 Active Service Units/ Month
$150/month = 3 Active Service Units/ Month
Step 2: Find number Active Service Units
2 Active Service Units x 24 months = 48 Active Service Units
3 Active Service Units x 48 months = 144 Active Service Units
Total = 192 Active Service Units
Step 3: Multiply number Active Service Units by Unit Multiplier:
Monthly Benefit Amount: 192 x $0.77 = $147.84
Example #2 – 12 years in Trust: An Association selects a contribution rate of $100/month, and Employee Jones participates for seven years (or 84 months) at that level. Then the Association increases the contribution rate to $200/month, and Jones participates for five years (or 60 months) at that level, and then retires. Then the monthly amount available to Jones for medical expense reimbursement will be calculated as follows:
Step 1: Convert monthly contribution to Active Service Units.
$100/month = 2 Active Service Units/ Month
$200/month = 4 Active Service Units/ Month
Step 2: Find number Active Service Units.
2 Active Service Units x 84 months = 168 Active Service Units
4 Active Service Units x 60 months = 240 Active Service Units
Total = 408 Active Service Units
Step 3: Multiply number Active Service Units by Unit Multiplier.
Monthly Benefit Amount: 408 x $ 0.77 = $314.16
Example #3 – Career Employee – 25 years in Trust: An Association selects a contribution rate of $100/month, and Employee Jones participates for seven years (or 84 months) at that level. Then the Association increases the contribution rate to $200/month, and Jones participates for 18 years (or 216 months) at that level, and then retires. Then Jones’ benefit level will be calculated as follows:
Step 1: Convert monthly contributions to Active Service Units.
$100/month = 2 Active Service Units/ Month
$200/month = 4 Active Service Units/ Month
Step 2: Find number Active Service Units.
2 Active Service Units x 84 months = 168 Active Service Units
4 Active Service Units x 216 months = 864 Active Service Units
Total = 1,032 Active Service Units
Step 3: Multiply number Active Service Units by Unit Multiplier.
Monthly Benefit Amount: 1,032 x $0.77 = $794.64
Caveat: These are examples. The Trustees reserve the right to modify the Unit Multiplier and the formula used to calculate benefit levels at any time for both existing and future Beneficiaries. Such a modification is most frequently attributable to favorable or adverse demographic or financial experience of the Plan.
1 The Trustees have the authority to modify the Unit Multiplier (UM) from time to time for both existing and future Beneficiaries and work with a professional actuarial firm to determine the UM.
