How Does the Healthcare of Ontario Pension Plan Work?

The Healthcare of Ontario Pension Plan, known as HOOPP, works as a defined benefit pension plan: you and your employer both contribute while you work, and in retirement you receive a guaranteed monthly income calculated by a set formula based on your years of service and your earnings, rather than by how the plan’s investments perform. It covers more than 500,000 Ontario healthcare workers and holds roughly $131.9 billion in net assets.¹

Who Is Covered and When Enrollment Starts

If you work full-time for a participating HOOPP employer, enrollment is mandatory and begins on your hire date. You start earning pensionable service and contributing right away.² Part-time, casual, and temporary employees can choose to join at any time, but enrollment isn’t required. If you’re part-time and move into a full-time role, you must enroll immediately.

HOOPP is a multi-employer plan, so switching jobs between participating healthcare organizations doesn’t reset your pension. Your service keeps building without interruption. If you hold part-time positions at more than one HOOPP employer at the same time, you can enroll at each, and your earnings from every contributing position are combined when your pension is calculated.³

What You and Your Employer Pay In

Contributions are mandatory and split between you and your employer. Your share is based on your earnings relative to the Year’s Maximum Pensionable Earnings (YMPE), a federal threshold tied to the average Canadian wage. For 2026, the YMPE is $74,600.⁴

You contribute 6.9% of earnings up to the YMPE and 9.2% on earnings above it. Contributions come off each paycheque and reduce your taxable income in the year you make them. For every dollar you put in, your employer contributes $1.26.⁵ The employer match plus investment returns generated by the plan’s professional managers cover most of the actual cost of paying retiree pensions. Your own contributions, meaningful as they are, make up a smaller share.

How Your Pension Is Calculated

Three things drive your pension: your years of contributory service, your best average earnings, and an integration formula that coordinates with the Canada Pension Plan.

Two Kinds of Service

HOOPP tracks two different service counts. Contributory service is the time you actually contributed, including service you’ve bought back or transferred in. That number goes into the pension formula. Eligibility service is the length of time you’ve been a HOOPP member, and it decides whether you qualify for an unreduced pension when you retire early.² For most full-time members who never took an unpaid break, the two numbers match. Gaps in contributions can push eligibility service higher than contributory service.

The Formula

For each year of contributory service, you earn:

1.5% of your average annualized earnings up to the average YMPE, and
2% of your average annualized earnings above the average YMPE.

Your average annualized earnings are calculated from your highest five consecutive years of earnings while a HOOPP member.⁶ The lower rate below the YMPE reflects the fact that CPP already replaces part of your income on that portion of earnings. Together, HOOPP and CPP aim to replace a consistent share of your pre-retirement pay across your full earnings range.

The Bridge Benefit

If you retire before age 65, HOOPP also pays a monthly bridge benefit until you turn 65 or pass away, whichever comes first. It equals 0.5% of your average annualized earnings up to the average YMPE, multiplied by your years of contributory service.⁷ The bridge keeps paying even if you start CPP early, so taking CPP before 65 doesn’t cost you anything on the HOOPP side.⁸

When You Can Start Your Pension

The earliest you can start your HOOPP pension is age 55. The latest is December 1 of the year you turn 71.⁷ You get an unreduced pension once you reach age 60 or accumulate 30 years of eligibility service, whichever comes first.⁹ Retire before hitting either milestone and your pension is reduced to reflect the longer expected payment period.

The reduction depends on both your age and your eligibility service. More service means a smaller reduction. A member retiring at 55 with fewer than 15 years of eligibility service receives 70% of the full pension. The same 55-year-old with 25 years of service receives 92.5%. By 60, the reduction disappears regardless of service.¹⁰ Fifteen years of eligibility service is the point where the schedule shifts in your favour, which matters if you’re thinking about a buyback to cross that line.

Does the Pension Keep Up With Inflation

HOOPP applies an annual cost-of-living adjustment (COLA), but the rules depend on when you earned your service.

For contributory service earned before 2006, you receive a guaranteed annual increase equal to 75% of the previous year’s change in the Consumer Price Index. The Board of Trustees can top that up to 100% of CPI if funding allows, though the top-up isn’t guaranteed. For service earned after 2005, COLA is fully discretionary. The Board votes each year on whether to grant it and at what level.¹¹

In practice, the Board has approved 100% of CPI every year since 2002, so post-2005 service has been fully protected across that span. For 2026, the Board approved a full COLA of 2.36%, effective April 1, 2026, applied to retired and deferred pensions and to pensions paid to surviving spouses and beneficiaries.¹¹ The track record is strong; the written guarantee on newer service is not.

Buying Back Service

If you have gaps, such as prior employment with a HOOPP employer when you weren’t contributing, or service under another registered pension plan in Canada, you may be able to buy that service back.⁷ Funds already sitting in a locked-in retirement account or RRSP from a previous pension can sometimes be transferred in to fund the purchase.

The cost depends on your age, current earnings, existing service, and the type of service you’re buying. Reaching a milestone like 15 years of eligibility service through a buyback pushes the price up because it unlocks a better early retirement reduction. Buybacks also get more expensive as you age, so acting earlier saves money.¹²

What Happens on a Leave, Disability, or Death

Pregnancy, Parental, and Other Leaves

During a pregnancy or parental leave covered under Ontario’s Employment Standards Act, you can choose to keep contributing. If you do, your employer must contribute their share too, so your pensionable service keeps growing. For leaves not covered by the ESA, leaves under 31 days require contributions from both sides, while longer leaves are at your employer’s discretion.¹³ You can either pay as you go or make a lump-sum payment within six months of returning. Contributing during a leave is almost always cheaper than buying that service back later.

Disability Pension

If you become totally and permanently disabled while working for a HOOPP employer, you can apply for a disability pension. To qualify, you must be under 65 with fewer than 35 years of service, have contributed before your health leave, and be assessed by HOOPP as unable to work in any employment reasonably suited to your education, training, or experience for the rest of your life. There’s no waiting period; you can apply as soon as your health leave starts.¹⁴ The disability pension is calculated as an unreduced benefit. Members who have already retired, deferred their pension, or weren’t contributing before their health leave don’t qualify. The bridge benefit is not paid while a disability pension is being received.⁸

Survivor and Death Benefits

If you have a qualifying spouse when your pension begins, Ontario law requires the pension to be paid as a joint and survivor benefit, with your spouse receiving at least 60% of your pension for life after you pass.¹⁵ HOOPP’s standard survivor benefit exceeds that minimum: your spouse receives 66⅔% of your monthly pension (excluding the bridge) for life. You can raise the survivor portion to 80% or 100%, but either election lowers your own monthly payment.¹⁶ Your spouse can waive the joint and survivor benefit, but the waiver must be in writing, in the regulator’s approved form, and delivered to HOOPP within the 12 months before payments start.

A qualifying spouse is the person you’re married to (and not living separate and apart from), or the person you’ve lived with continuously in a common-law relationship for at least one year. A shorter cohabitation qualifies if you’re parents of a child together. The qualifying date is the earlier of when you retire or pass away.¹⁷

If you die before starting your pension, a qualifying spouse can take a pre-retirement survivor benefit as either a lifetime monthly pension or a lump-sum commuted value. Without a qualifying spouse, or if spousal benefits were waived, the commuted value goes as a taxable lump sum to your designated beneficiary, or to your estate if none is named.¹⁸

What Happens If You Leave Before Retirement

If you leave your HOOPP employer before retirement age, you generally have two options.

You can leave your pension in the plan and start collecting later. The earliest you can begin a deferred pension is age 55.⁹ While deferred, your benefit gets the same annual COLA adjustments retirees receive, and survivor protections stay in place. If you’re already 55 or older when you leave, you may be able to start the pension right away.

Alternatively, you can take the commuted value, the lump sum that would in theory fund your future pension if invested today. It generally has to be transferred to a locked-in retirement account (LIRA), a life income fund (LIF), or another employer’s registered pension plan. Federal tax rules cap how much can go into a tax-sheltered account; any excess is paid to you as taxable income in the year of transfer.¹⁹ A LIRA locks the funds in until retirement age under Ontario pension rules, with limited exceptions for financial hardship such as high medical expenses, and for small balances once you reach 55.²⁰ Taking the commuted value gives you control over the money but shifts the investment risk from the plan to you.

1
Healthcare of Ontario Pension Plan (HOOPP). HOOPP 2025 Annual Report
2
HOOPP. Frequently Asked Questions
3
HOOPP. Working for Multiple HOOPP Employers
4
Canada.ca. MP, DB, RRSP, DPSP, ALDA, TFSA Limits, YMPE and the YAMPE
5
HOOPP. How Your Pension Works
6
HOOPP. Explore the Pension Formula
7
Healthcare of Ontario Pension Plan (HOOPP). HOOPP Handbook
8
HOOPP. Early Retirement Benefits
9
HOOPP. When Can I Retire
10
HOOPP. HOOPP Early Retirement Table
11
HOOPP. Inflation Protection
12
HOOPP. Buying Back Service
13
Healthcare of Ontario Pension Plan (HOOPP). HOOPP Handbook – Contributing During a Leave
14
Healthcare of Ontario Pension Plan (HOOPP). HOOPP: Here for You – Disability Guide
15
Ontario.ca. Ontario Pension Benefits Act, R.S.O. 1990, c. P.8
16
Healthcare of Ontario Pension Plan. Survivor Benefits: Choosing the Right Option for Your Spouse
17
Healthcare of Ontario Pension Plan (HOOPP). HOOPP Handbook – Summary of Terms
18
HOOPP. Information for Survivors
19
Healthcare of Ontario Pension Plan (HOOPP). Leaving Your HOOPP Employer
20
Financial Services Regulatory Authority of Ontario. 2026 User Guide for Financial Hardship Unlocking Form FHU 1