Retirees from state agencies, school districts, and some local government entities receive health benefit coverage from the Public Employees' Benefits Board (PEBB) program administered by the Health Care Authority (HCA). About 80,000 retired employees subscribe to PEBB retiree health benefit coverage, most of which pay retiree premiums through monthly deductions from retirement benefits paid by the Department of Retirement Systems (DRS). 

Retirement benefits in the month that a retiree dies are prorated to the date of death. If a full monthly benefit was paid, DRS takes back the entire pension payment for the final month, including the health benefit premium remitted to HCA, calculates the correct payment for the final month, and deposits the corrected amount in the member's bank account. DRS does not resend premium payments for health benefit premiums to the HCA. Typically DRS makes benefits payments during the later part of each month, so a typical repayment required of the deceased member's estate is for three or four days' worth of benefits. 

During the month that a retired participant in the PEBB health coverage program dies, HCA must waive the payment of premiums. HCA must enroll any eligible surviving dependents in the same plan effective on the first day of the month in which the death occurred, and require those survivors to pay the applicable premiums.