Background

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The name of the Plan is the State of Montana Health Benefit Plan and Trust, also known as the Montana Health Reimbursement Account or Montana VEBA HRA. The Montana VEBA HRA was developed as a grass-roots effort for public Employers to offer to their employees in the State of Montana.

In the year, 2000, a legislative committee comprised of representatives from public employers, including representation from State Government, City and County Government, K-12 entities and the Montana University System, met to discuss post-retirement funding issues. These discussions prompted the drafting of legislation for the 2001 session of the Montana State Legislature.

In April of 2001, Senate Bill 51 authorized the enrollment effort of the Montana Voluntary Employees Beneficiary Associate (VEBA) and directed the Department of Administration (DOA) at the State of Montana to establish the plan. The Montana VEBA advisory Council was then created with representation from the State of Montana, City and County Government, K-12 and the Montana University System (MUS.)

Legal and VEBA Consulting services were obtained through the RFP process in April of 2001. Work began to procure a favorable Letter of Determination from the IRS. Additionally, we developed the Trust Instrument and the Plan Document. The Trust was procured in April of 2003. We received IRS approval of our Letter of Determination in July, 2003.

The award of contracts for the Administrative, Accounting and Record Keeping, Claims Processing and Education Services was made in August, 2003. The vendors which supply those services for the Montana VEBA HRA are:

  • Washington Trust Bank - Spokane, WA Trust and Investment Manager
  • A.W. Rehn & Associates - Spokane, WA Accounting/Record-Keeping and Claims Administration services
  • State of Montana- DOA, HCBD Staff Helena, MT Education and Training services

In July of 2007, Senate Bill 168 was passed which allows the 25% sick-leave balance to be divided between taxed cash and tax-free contribution to the employee's VEBA account. In addition, annual leave is available as an additional source of contribution at a rate of 100%. All other public entities had additional sources of contribution after sick-leave available to them but with the passage of Senate Bill 168, the State of Montana now does as well.

Currently, the Montana VEBA HRA provides the opportunity to enroll over 60,000 public employees in the State of Montana.  There are approximately 200 groups enrolled with the State of Montana and a number of K-12 entities, counties, cities and University groups participating in the Plan.