A substantial number of publications have addressed the fact that many individuals are unable to retire early as a result of the serious economic and investment environment. Many large employers, however, continue to put forward early retirement programs that often challenge those that haven’t clearly planned their retirement. While there is much discussion surrounding retirement income, health care remains an overriding concern to these individuals and to those who have already retired and are not yet age 65.
Post retirement health insurance, until recently, was a component of most retirees’ benefit packages. Over the past 20 years, this benefit has been eliminated by many large employers. Although the $5 billion temporary reinsurance program was created by the Patient Protection and Affordable Care Act to fund employer sponsored post retirement health benefits for retirees age 55-64, it is unlikely that large employers who have done away with this benefit will reinstitute it.
As one would expect, the concern facing these individuals is obtaining health insurance given the fact that it is likely many have pre existing conditions and have no opportunity to enroll in another health plan. The Affordable Care Act does not allow insurers to decline coverage, however, this provision doesn’t take affect until 2014.
The Pre-Existing Condition Insurance Plan (PCIP) enables individuals to enroll in a health care plan irrespective of any prior health history. As expected these plans are state administered and, therefore, differ from state to state. There is also a federal government plan partially funded by the Department of Health and Human Services that serves as a PCIP in 21 states. The costs and coverage models vary among states as does the number of plans available. Also, insurers can request medical history, thereby potentially increasing premiums. In 2014, individuals will be able to purchase coverage through exchanges.
Post retirement health care will continue to concern pre retirees and early retirees, especially those age 55-64. EAB Healthworks can assist you in developing a program that speaks to the needs of clients and employees. For additional information contact us.