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Pensions; Ill Health Retirement
Ian Mckenna has authored this section to answer peoples questions in regards to ill-health retirement. Where appropriate, there are links to the relevant NHS web sites where required;
What do I need to do if I think ill health retirement applies to me?
You should first read the Members Guide - SD Guide (PDF 1557kb). If you are a current member and have at least 2 years membership, you should contact your employer for a form AW33E. This form is in three Parts;
- Part A – this is for your employer to fill in and provides information about your NHS employment and any absences due to illness or injury (sick leave)
- Part B – this is for you to complete with your personal details and to give your consent for NHS Pensions and its medical advisers to consider your request
- Part C – this section is for your Occupational Health Doctor to provide information and medical evidence about your condition
Is there an age limit for ill health retirement benefits?
Yes, in order to qualify for ill-health retirement benefits your last day of Scheme membership must be before your 60 or 65th birthday.
This is because ill health retirement benefits provisions are limited to those members who have not reached their normal retirement age. Normal retirement age in the 1995 section of the NHS Pension Scheme is age 60, and in the 2008 section of the NHS Pension Scheme, age 65.
How do you decide if I qualify for ill health retirement benefits?
As decisions depend largely on medical assessments NHS Pensions takes advice from a professional team of medical advisers, doctors qualified in the field of occupational health – Atos Healthcare.
What is the medical advisers role?
The role of the medical advisers is to carry out an objective and independent professional assessment of all the available medical evidence and offer an opinion based on that assessment. The medical advisers can also commission further medical evidence if they consider it relevant and helpful to their assessment, for example your general practitioner or your specialist.
What are the qualifying conditions for ill health retirement benefits?
The NHS Pension Scheme provides two levels of ill-health retirement benefits, dependent on the severity of your condition and the likelihood of you being able to work again.
To qualify for a Tier 1 pension you must be permanently incapable of efficiently carrying out the duties of your employment because of illness or injury.
To qualify for a Tier 2 pension you must be permanently incapable of engaging in regular employment of like duration to your NHS job (i.e. either whole time or part time) because of illness or injury
What does “permanently incapable” mean?
For the purpose of ill health retirement benefits “permanently incapable” means until the Scheme’s normal benefit age. That is age 60 in the 1995 section of the NHS Pension Scheme or age 65 in the 2008 section of the NHS Pensions Scheme.
How will you determine “permanent incapacity”?
In order to judge this NHS Pensions must be satisfied that not only has your condition been fully investigated but that all reasonable treatment options have been explored and have proved unsuccessful or inappropriate. In looking to establish permanence NHS Pensions use the civil burden of proof, i.e. the balance of probabilities.
If my employer terminates my contract due to ill health will I automatically qualify for ill health retirement benefits?
No – a decision by an employer to terminate a person’s employment will not automatically lead to payment of ill health retirement benefits from the Pension Scheme. The two are entirely separate and rely on different criteria. For instance, whilst the Pension Scheme Regulations require that a member is permanently prevented from efficiently performing the duties of their job, the employer, in considering whether termination is appropriate, may look at a considerably shorter period because of the need to have the post filled.
If I am getting Incapacity or Disability benefits will I automatically qualify for ill health retirement benefits?
Not necessarily - the criteria for acceptance of ill health retirement benefits under the NHS Pension Scheme are different to the criteria adopted by the Department of Work and Pensions when determining entitlement to incapacity and disability benefits. Entitlement to the latter benefits only takes into consideration the condition presently existing whereas the issue that NHS Pensions and its medical advisers must carefully consider is whether your health problems are likely to prevent you from carrying out the duties of your NHS employment, or regular employment, until the Scheme’s normal retirement age.
What is a Tier 1 pension?
If you are assessed as being permanently incapable of carrying out the duties of your own job you will be entitled to the early payment of the retirement benefits you have earned to date paid without any actuarial reduction for the early payment. In other words, these benefits will not be reduced to cover the extra cost of being paid before the Scheme’s normal benefit age.
What is a Tier 2 pension
If you are assessed as being permanently incapable of engaging in regular employment of like duration you will be entitled to the retirement benefits you have earned to date enhanced by 2/3rds of your prospective membership up to the Scheme’s normal retirement age.
Will my pension be index-linked?
Yes – your ill health pension will be fully index-linked to protect it against inflation. This means that it will be increased each year in line with the cost of living, for as long as it is paid.
What if I have a serious illness?
If you are terminally ill and do not expect to live longer than a year, you can apply to exchange all of your ill health benefits for a one-off, usually tax free, lump sum payment. If you want to do this you should let you employer (normally the Pensions Officer) know.
If my request for ill health retirement benefits is not successful can I appeal?
Yes – if you think we have made a mistake, or you simply do not agree with our decision, or you feel we have not dealt with your case very well, you can ask us to look at your request for ill health retirement benefits again under the Internal Dispute Resolution (IDR) procedures. To do this you must complete Form DPR (.pdf 60kb).
Read the NHSB Ill Health Factsheet
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