The Department of Health and Human Services (“HHS”) has issued interim final rules relating to the Early Retiree Reinsurance Program introduced by the Health Care Reform Acts. The program will make available $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. The program will end in 2014, when individuals will be able to choose from additional coverage options through the health insurance exchanges. It is expected that applications for reimbursement for qualifying expenses will be accepted on a first-come first-served basis until the designated funding is exhausted.
Each employer plan seeking reimbursement under the program must be certified by the HHS; applications will be available by the end of June. In order to become certified, a plan must have in place cost-saving programs for chronic high-cost conditions and meet certain other conditions. Reimbursements to employers under the program must be used for plan purposes and plans will be subject to audits by the HHS. Both self-funded and insured plans may apply, including plans sponsored by private entities, state and local governments, nonprofits, religious entities, unions and other employers. For more information, contact your health plan insurer or third-party administrator.