The early retiree reinsurance program provides $5 billion for temporary reimbursement of medical costs to eligible plans. Plan sponsors who are accepted into the program will receive reinsurance reimbursement for most medical claims for retirees and surviving spouses ages 55 and older who are not eligible for Medicare and for their spouses and dependents.
Plan sponsors must apply for the program through the Department of Health and Human Services (HHS). HHS has stated applications will be available no later than June 30, 2010. Visit HHS website to see a draft application.
Plan sponsors may apply for reimbursement of costs incurred from the date the program was established: June 1, 2010. The program ends on January 1, 2014. The program could end earlier if the $5 billion fund is exhausted.
Payments will be made to plan sponsors who are accepted into the program. To become eligible to receive assistance, plan sponsors must apply, document claims, and implement programs and procedures to generate cost savings for participants with ongoing and high-cost conditions. Plans will be subject to audits to assure fiscal integrity. Fully insured plan sponsors have the same opportunity for reimbursement as self-insured sponsors.
The amount of this reimbursement is up to 80 percent of claims costs for health benefits between $15,000 and $90,000. Claims incurred between the start of the plan year (often January 1) through May 31 are credited toward the $15,000 threshold for reimbursement. However, only medical expenses incurred after June 1, 2010, are eligible for reimbursement.
Plans must use proceeds to lower health costs for early retirees and their dependents (for example, premium contributions, copayments, deductibles, etc.) and/or keep their own health care costs level.
To help you with this process, the following are templates you can use to document information you may need for your application.
Use this template to help document purchased programs and designed benefits that are expected to reduce the cost of claims that are likely to exceed $15,000 for early retirees. Contact your account manager if you are not sure what programs and designs you have in place.
Use this contract template to allow us to correspond with HHS if there are inquires or an audit per your application. Appendix A (cost reporting fees) is not yet provided, and will be negotiated for employers who are certified. Fees will depend on the frequency, method and detail of claims reporting. Claims reporting detail is still not known; we are awaiting guidance from HHS. For those who make significant changes to this document, we will need to send those changes to our legal department for further review.
See the links below for more information about this program. If you have questions, contact your account manager.
Visit HHS website for more program information
Visit HHS website to see a draft application
Template for documenting programs/benefits (MS Word)
Contract template for HHS inquires/audit (PDF)