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Retiree Health Access - Health Insurance Solution For Pre- And Post-65 Retirees

Armen Hareyan's picture

HR Policy Association to offer a first of its kind retiree health insurance offering for pre- and post-65 retirees.

Beginning January 1, 2008, participating companies in the Association will be able to offer their retirees access to comprehensive, guarantee issue health benefits through the Retiree Health Access(SM) program.

Finding guaranteed access to affordable retiree medical health care coverage, especially for pre-65 retirees who are not yet eligible for Medicare, presents a vexing problem for large employers, their retirees, and their families. Accounting rule changes in the early 1990s (FAS 106 obligations) required employers to begin to account for future retiree medical obligations. This and skyrocketing health care costs have made it fiscally impossible for many employers to continue paying for retiree coverage at previous subsidy levels, and FAS 106 discourages others not currently offering coverage from doing so.

Against the backdrop of difficult economic and social forces, Retiree Health Access offers a unique solution by providing access to a fully-insured, pre- and post-65 retiree medical solution that will be available to retirees regardless of their health status or their employer's level of premium contribution.

Retiree Health Access was developed for the Association by the Health Care Policy Roundtable, LLC. Following a rigorous selection process, Aetna was chosen as the carrier to provide this unique offering because of its willingness to work creatively with the members of the Association. Jeffrey C. McGuiness, President of HR Policy Association, said, "With Retiree Health Access, we tried a different approach to health care reform -- help the marketplace understand what the consumer wants instead of settling for what is currently on the shelf. We've definitely had a breakthrough by getting a guarantee from Aetna that all retirees can get access to comprehensive insurance regardless of health status. The key question now is if we can make this affordable for retirees regardless of how much their employer subsidizes coverage."

Association Chairman and Senior Vice President, Human Resources for IBM Corporation, J. Randall MacDonald said, "The past system of offering retirees medical benefits has proven difficult to maintain and cost prohibitive for many employers. This Association recognizes that new solutions are needed if companies are to remain economically competitive, and it is committed to developing ways to create affordable and accessible retirement options for workers."

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Retiree Health Access features significant advantages for employers and their retirees:

-- Guaranteed-issue comprehensive coverage: Employees considering retirement are primarily concerned with securing coverage that protects their assets against significant health care costs. Retiree Health Access guarantees access to an array of comprehensive coverage options for individuals who enroll at retirement are regardless of their health status.

-- Fully insured solutions: Aetna has agreed to bear the risk of Retiree Health Access through a fully insured arrangement.

-- Coverage for pre- and post-65 retirees: Employers need a retiree health insurance solution for all their retirees -- early retirees (those younger than 65, the age of Medicare eligibility) and Medicare eligible retirees -- and Retiree Health Access is the first program of its kind to offer a comprehensive, fully insured, guaranteed-issue coverage for both categories of retirees.

-- Flexible employer contribution: Retiree Health Access is available to retirees of participating employers regardless of how much their employer contributes to their premiums.

-- Comprehensive administrative support: Retiree Health Access allows employers to take advantage of comprehensive administrative support, minimizing resources that employers would need to provide retiree benefits while giving retirees all the support that they need.

-- Built in incentives for aggressive disease management: Because Retiree Health Access is being offered as a fully insured product, Aetna bears the insurance risk and has a direct incentive to aggressively promote effective disease management and healthy lifestyle decisions among enrolled retirees.

HR Policy Association, established in 1957, consists of chief human resource officers representing nearly 250 of the largest corporations in the United States. From nearly every major industry sector, HR Policy members have a combined market capitalization of more than $8.2 trillion and employ more than 18 million employees worldwide. Due to extreme concern over skyrocketing health care costs in the United States and deficiencies in efficiency and quality, the Association has been working through its public policy agenda and market reform initiatives to address the problems that plague our nation's health care system.