There’s an intriguing provision in the new health care reform law for retiree medical plans: 80% reinsurance for each early retiree’s claims between $15,000 and $90,000. The official summary is here.
There’s a fixed amount of money available for this, just $5 billion. When it’s gone, it’s gone. And remember that $5 billion doesn’t go as far as it used to, so you gotta get in line right away. The application will be available in June, and it will be a lot like the one for Medicare Part D’s Retiree Drug Subsidy program.
Of course there’s a catch: your retiree medical plan needs certain cost saving provisions to qualify. It’s not clear yet what those should be. Actually, there’s a lot that’s not clear yet. But it sure looks like a sweet deal, so it’s worth a look.
It will reduce OPEB costs for public and private employers, and for their plan members. Exactly how much will depend on your own retiree health plan provisions.