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Statement from Commerce Secretary Gary Locke on New Affordable Care Act Reinsurance Program's Benefits for Employers
WASHINGTON, D.C. (May 4, 2010) – The U.S. Department of Health and Human Services today issued regulations establishing the Early Retiree Reinsurance Program in the Affordable Care Act. The new law provides $5 billion in financial assistance to employers to help them maintain coverage for early retirees age 55 and older who are not yet eligible for Medicare.
Employers can use the savings to either reduce their own health care costs, provide premium relief to their workers and families, or a combination of both. Employers who are accepted into the program will receive reinsurance reimbursement for medical claims for eligible retirees and their spouses, surviving spouses and dependents.
“Business leaders I’ve met with over the last year asked for two important things from health care reform: lowered costs and certainty,” Commerce Secretary Gary Locke said. “This new program provides both. It will help make it more affordable for firms to offer health insurance to their retirees, and it will blunt the costs to businesses from retirees who incur catastrophic medical expenses.”
The amount of this reimbursement to the employer plan is up to 80 percent of claims costs for high medical expenses – between $15,000 and $90,000.
You can find more information about this program by clicking here.
Also, tune in to the next Affordable Care Act web chat at healthreform.gov if you want to learn more about how this new benefit could affect you and your company or your family member who is considering early retirement.