If employees do not want health insurance coverage through the State Group Health Insurance program, they may be eligible to receive a stipend of up to $2,000 (Opt-Out Incentive) by opting out of State Group Health Insurance.

Employees are not eligible for the Opt-Out Incentive if they:

  • are not a Wisconsin Retirement System participant (i.e., an employee covered under the Graduate/Short-Term Academic Staff benefits package); or
  • were eligible for a State contribution (as a Wisconsin Retirement System participant) to health insurance in 2015 and elected not to receive State Group Health Insurance in that year; or
  • do not receive an employer contribution towards their health insurance (Crafts workers); or
  • receive State Group Health Insurance through a parent or spouse (including the Grad benefit program at the UW System or UW Hospital and Clinics). Employees of the UW System, UW Hospital and Clinic and state agencies all participate in the State Group Health Insurance program through ETF.

Health insurance coverage through a parent or spouse employed by a local government entity does not disqualify an employee for the Health Insurance Opt-Out Incentive.

The $2,000 Opt-Out Incentive is prorated and, if elected, is paid for months the employee is eligible for the employer contribution towards a health insurance premium. Employees will receive an equal portion of the payment in each payroll period (for employees paid on a biweekly basis, payment will be distributed through 24 payrolls a year).

The Opt-Out Incentive does not carry over from year to year. It must be re-elected each year during Annual Benefits Enrollment.

Important Considerations

  1. Impact on Sick Leave Credits. Unused sick leave can provide a valuable benefit. When an employee retires, or if  they should die while an employee, unused sick leave is converted into credits to pay for health insurance for the employee or their surviving spouse/dependents (if they are covered under the health insurance program). If they choose to opt out, their unused sick leave credits have no value until/unless they re-enroll in the health insurance program in the future.
  2. Re-enrolling in Health Insurance. Employees may re-enroll during the year if they have a qualifying life event (such as marriage, birth of a child, loss of other coverage). The $2,000 Opt-Out Incentive will be prorated by payroll period.
  3. Enrollment in Other Benefit Plans. If an employee opts out of health insurance, they will not be eligible for Uniform Dental benefits since enrollment in a State Group Health plan is required to receive this benefit. However, during the Annual Benefits Enrollment (ABE) period, employees may still elect a supplemental dental plan.
  4. Taxable. The $2,000 Opt-Out Incentive is taxable.

How to Opt Out

Employees should elect the Opt-Out Incentive through Self Service during their initial 30-day enrollment period.

Employees that are unable to use Self Service to make their elections may complete a paper Health Insurance Application/Change Form (see Forms & Resources below) and submit it to their human resources office within 30 days of their date of employment or newly benefits-eligible job. Employees should complete the following sections of the application: Section 1 (Applicant Information), Section 2 (Spouse Information, if applicable) and Section 12 (to elect Opt-Out Incentive).

If employees are unsure whether they are eligible for the $2,000 Opt-Out Incentive, they should contact their human resources office.

Employees must re-enroll in the Health Opt-Out Incentive each year during the Annual Benefits Enrollment period if they want to opt out for the following plan year. Health Opt-Out elections do not carry over from year to year.

Forms & Resources


Every effort has been made to ensure this information is current and correct. Information on this page does not guarantee enrollment, benefits and/or the ability to make changes to your benefits.