2020 Retirement Incentive Option

To make retirement easier and more attractive for long-term faculty and staff, the University of Minnesota is offering a $38,000 contribution to participating employees to offset future healthcare costs.

The 2020 Retirement Incentive Option, often called the “RIO” for short, is a one-time benefit that will only be available for a short period of time. Only University employees who are close to retirement and meet the eligibility requirements can participate. The RIO opened for eligible employees on August 17, 2020. 

The RIO contribution will be split over two payments of $19,000 each to the State of Minnesota’s Health Care Savings Plan (HCSP) which allows participants to pay for health care costs in retirement. The RIO will also help University colleges and units save on salary and fringe costs.

Note: If you are a supervisor or manager looking for information on the RIO, please check the RIO Supervisor and Manager Resources page.

University employees who choose to take advantage of the RIO have to retire on or before January 15, 2021. Please read this information thoroughly. More detailed information is available in the Retirement Incentive Option 2020 Administrative Policy.


You can view this webinar about the RIO, otherwise the details of the program can be found below.

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To take advantage of the 2020 RIO, University employees must be employed in a 75% appointment or greater for 9 months and be eligible for normal retirement which means:

  • Age 50 or older with 15 years of service, or
  • Age 55 or older with 5 years of service, or
  • Any age with 30 years of service

Eligible employees must also:

  • Be currently eligible for University-subsidized benefits
  • Be actively working their scheduled appointment hours through their last day of service

Employees must meet these requirements as of their date of retirement or October 19, 2020, whichever is earlier.


Employees who are not eligible for the 2020 RIO include:

  • Faculty who are temporary, visiting, adjunct, or clinical from outside the University
  • P&A staff with flexible, hourly, summer research only, lump sum, or summer session appointments only; or have 95XX, 9755, 9756, or 9757 appointments
  • Civil Service and Labor-Represented staff working in a temporary or hourly appointment (without standard hours)
  • Any employee who is not actively working, was terminated for cause, is participating in another University exit program, or has previously participated in a University Retirement Incentive Option program

Incentive payment details

The $38,000 payment will be made over two installments to the employee’s State of Minnesota Health Care Savings Plan (HCSP).

  • Half of the payment ($19,000) will be deposited into the HCSP as soon as administratively possible after an employee’s last day of employment after signing a release.
  • The other half of the payment will be made in July or early August 2021, but only if the employee has not been rehired. If the person is rehired by the University within six months of their retirement date, the first payment must be repaid and the second payment is forfeited.

The payment is roughly equal to 24 months of University-subsidized medical and dental coverage for two people.

Health Care Savings Plan

The 2020 RIO incentive payments will be deposited to the Health Care Savings Plan (HCSP), which is administered by the Minnesota State Retirement System (MSRS).

The plan accommodates tax-free contributions and reimbursements for qualified medical expenses which include:

  • Medical, dental, long-term care, Medicare, or COBRA premiums for employees, spouses, and dependents
  • Medicare Part B, C, and D premiums
  • Insurance deductibles and copays
  • Dental expenses

An employee’s HCSP account can only be withdrawn for qualified health care expenses. However, the account does not expire and can pass on to beneficiaries.

More HCSP Resources

Important deadlines and considerations


  • Eligible employees must elect the RIO between August 17, 2020, and October 19, 2020 (or their retirement date, if earlier)
  • Employees taking the RIO must retire by January 15, 2021
  • After six months, employees can return to University employment in a non-benefits-eligible position of no more than 19.5 hours per week. If employees return to University employment after 6 months but on or before July 15, 2021, only the first payment will be made.


  • In exchange for participating in this program, the employee signs a release of all potential claims against the University. The employee may, however, rescind the University of Minnesota Retirement Incentive Option 2020 Release agreeing to participate in this program within 15 calendar days following their execution of the Release. Such rescission, as specifically provided for in the Release, must be made in writing and forwarded to the Total Compensation Department within the 15-day period.
  • Any employee who rescinds a Release forfeits any benefit to the program; however, such employee’s termination remains irrevocable. An employee who rescinds a Release is not entitled to any future employment at the University of Minnesota.

Next steps to participate in the RIO

  1. Submit the RIO Agreement (pdf - download to sign) to your department starting August 17, 2020 and before October 19, 2020 or your retirement date, if earlier. Please make sure all fields on the form are signed by your department representatives before submitting.
  2. Complete the continuation of coverage form (pdf) if you want to continue your UPlan benefits. More information on how to enroll in the UPlan as a retiree, spousal benefits, and Medicare are available in the 2020 Retiree Benefits Guide (pdf).
  3. Sign the RIO Release (pdf - download to sign) on your last day of employment and return it to Total Compensation.
  4. Look for a packet from HCSP to be mailed to you within 8 weeks of your retirement, if you do not have an existing account.

Frequently Asked Questions (FAQs)

Q: What is meant by being actively at work?

A: Employees must work to the end of their regularly scheduled day, and be in a physical and mental condition to have continued to work their full scheduled appointment for the foreseeable future. They must not be on any form of leave of absence, including, but not limited to vacation, personal leave, FMLA, or medical leave.

Q: In calculating the final year of service, if average percentage is over 50%, does the employee need to be employed on the anniversary date to count?

A: Yes, even if the employee has worked over 50 percent time in the final year, the employee must be employed on the anniversary date to count as a year of service.

Q: What is the cost to the department or unit?

A: The cost of HCSP contribution will be charged directly to the department’s or unit’s budget.

Q: What does it mean for employees to actively work their scheduled appointment hours through their last day of employment?

A: The University expects participants in the RIO program to actively work their full appointment hours each scheduled work day from the time they elect the program through their retirement date. Normal and reasonable vacation and sick day usage should not jeopardize RIO eligibility, unless used on the last day of work. The use of vacation, medical leave, or any other form of leave to extend benefits eligibility will not be permitted.

Q: Can a department deny the RIO program to an eligible employee?

A: No. If an employee qualifies for the RIO program, the department cannot deny participation. However, the department can negotiate the final retirement date with the eligible employee, as the retirement date is determined through mutual agreement between the employee and the department, as long as the retirement date is on or before January 15, 2021.

Q: If employees elect the RIO program, are they required to enroll in a University Retiree Medical Plan?

A: No. RIO program participants are eligible to continue University Retiree coverage or federal coverage, depending on the program in which they participate, but they are not required to do so. If employees choose not to continue coverages, they may not rejoin the UPlan Retiree Group in the future.

Q: If RIO participants do not have other deposits going to a HCSP account (like vacation payouts), are they still eligible for the program?

A: Yes. Some employee groups at the University have additional amounts deposited into the HCSP. For example, civil service employees with 10 or more years of service and 200 or more hours of vacation at retirement or termination have their entire vacation payout deposited into the HCSP when they leave the University. However, this is not a requirement for participation in the RIO program. Contributions made as benefits from the RIO program will be deposited to an existing HCSP account for those who have them; a new account will be established for those who do not.

Q: Are there any restrictions on returning to the University?

A: Yes. An employee may not resume employment at the University of Minnesota in any capacity for a minimum of 6 months following the date of retirement. Any employee who participates in the RIO Program may only return to University employment in a position of no more than 19.5 hours per week (49% work effort). These positions are compensation-only positions; that is, they are not eligible for University benefits. No other reemployment is permitted. Any RIO participant who returns to University employment prior to July 16, 2021 will forfeit all rights to the second HCSP payment of $19,000.

Find help

If you have questions about the continuation of benefits or the 2020 RIO, please call the Office of Human Resources Contact Center at 612-624-8647 (option 1) or 1-800-756-2363.