Defined Dollar Benefit Plan

The Defined Dollar Benefit (DDB) program is offered to all retirees who are enrolled in University-sponsored medical coverage. 

Health care costs and the escalation of those costs can be very unpredictable. Historically, health care costs have a much higher rate of inflation than the general consumer price index (CPI).

Since the University offers retiree health care coverage, it has an obligation to record the liability of the program on its financial statements. Funding the program in a way that makes the University’s contribution towards retiree health care coverage more predictable is prudent fiscal management. It helps ensure that the benefit is likely to continue by establishing a manageable budget it seeks to fund.

The University established a credit-based system that it provides to eligible retiring faculty and staff. The credits each eligible retiring faculty and staff member receives monthly may be used to purchase retiree health care coverage. The credits are also provided to the eligible spouse or domestic partner.

More detailed information about this plan can be found in the DDB Plan.

General Information

On the first business day of each month, a fixed amount of credits is applied to an account that may be used toward the reimbursement of retiree medical coverage. The credits cannot be used toward the cost of dental or vision coverage, or toward the cost of Medicare premiums.

The amount of credits per month is reviewed annually with an effective date of January 1, and increased in accordance with the medical component of the consumer price index up to five percent. As of January 1, 2018, DDB credits will increase to $401 per month. 

Credits will accrue if coverage is obtained through a spouse/partner or another employer, but will not accrue while retirees and their spouses/partners are covered under the University’s pre-65 active medical plan. Under the DDB program, you may continue enrollment in University-Sponsored coverage or you may elect any other retiree medical coverage. The cost of the premiums may be reimbursed from the credits in an account established for you and your eligible spouse/partner.


Please visit the FAQ page for more information about retirement and DDB coverage.