FRS Health Insurance Subsidy: Amount, Form HIS-1, and Eligibility Rules

The FRS Health Insurance Subsidy is a monthly payment that helps cover health insurance costs — and many surviving spouses either don't know it exists or leave money on the table by filing late. The amount is modest but adds up: it's separate from the pension and continues for as long as you receive a qualifying monthly benefit.

How the HIS Amount Is Calculated

The HIS payment is based on a simple formula:

Monthly HIS = years of creditable service × $7.50

Senate Bill 7024 (2023) increased this rate from the previous $5.00 per year. The statutory minimum payment is $45 per month (for members with 1 to 6 years of service), and the maximum is $225 per month (for members with 30 or more years of service).

A member who worked 20 years in FRS-covered employment generates a monthly HIS payment of $150 ($7.50 × 20). A member with 30 or more years hits the $225 cap.

The HIS is not a deduction from your pension — it's an additional payment deposited alongside your monthly survivor benefit. It's taxable income unless your total health insurance premiums paid directly from the check or to the employer equal or exceed the HIS amount for the tax year.

Who Qualifies for HIS as a Survivor

Eligibility is narrow. Only a surviving spouse (or an eligible joint annuitant) who is receiving a monthly continuation benefit from the Pension Plan qualifies for the HIS. That means:

• You're receiving a monthly Option 2, 3, or 4 pension continuation payment, or
• You're receiving an ILOD survivor benefit

Named beneficiaries who are not the surviving spouse — and survivors who only received a lump-sum contribution refund or DROP balance — are not eligible for HIS. If your monthly pension benefit stopped (for example, Option 2 expired after the 120-month guarantee period), HIS stops too.

Investment Plan survivors have a parallel pathway. A surviving spouse or qualifying annuitant who receives ongoing payments from the Investment Plan may qualify under the HIS-IP rules, but the eligibility requirements differ slightly and the application uses a different form.

Which Form to File

Pension Plan survivors file Form HIS-1 (Application for Health Insurance Subsidy) with the Division of Retirement. You must provide proof of active health insurance coverage — this can be Medicare Part A and Part B, TRICARE, a commercial group health plan, the State Group Insurance Program, or any qualifying health coverage. The HIS is a supplement; it doesn't provide insurance itself.

Investment Plan survivors file both Form HIS-IP and Form HIS-IP-2 as required by the Division of Retirement. The forms are available from the Division and MyFRS; Alight Solutions administers Investment Plan accounts but does not process the HIS application.

Don't confuse these forms. Submitting HIS-1 when you're an Investment Plan survivor, or vice versa, delays processing and may result in your application being returned.

The Retroactive Payment Cap

Here's the detail that costs people money: HIS retroactive payments are capped at a maximum of 6 months prior to the date the Division receives and approves your application. If you wait 8 months after starting your survivor benefit to file for HIS, you lose 2 months of retroactive payments permanently.

File your HIS application at the same time as your Form FST-11b for monthly pension benefits. Don't wait until the pension claim is fully resolved — the HIS application can be in process simultaneously, and the earlier the Division receives it, the more retroactive months you'll receive.

Health Coverage You Need to Maintain

The HIS isn't free money with no strings. You must maintain active health insurance coverage to keep receiving HIS payments. The Division verifies coverage periodically. If your health coverage lapses — you drop Medicare Part B, your employer group plan ends, or you fail to maintain any qualifying coverage — your HIS payments stop until you re-establish coverage and notify the Division.

For surviving spouses who were covered under the deceased's State Group Insurance plan, you have the option to continue coverage by paying the full monthly premium (both the employee and state portions). This keeps you eligible for both health coverage and the HIS supplement.

The FRS Survivor Benefits Guide includes the HIS calculation worksheet, both application forms, and the documentation checklist for proving your health insurance coverage.

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