Early Retiree Reinsurance Program Regulations Issued by HHS For Use Until 2014

Have you retired early or are you contemplating the implications of such a move?  The percentage of large firms providing workers with retiree coverage has dropped from 66 percent in 1988 to 31 percent in 2008. This week, the U.S. Department of Health and Human Services issued regulations establishing the Early Retiree Reinsurance Program in the Affordable Care Act.  This temporary program will make it easier for employers to provide coverage for early retirees and eligible employers can apply for the program through the Department of Health and Human Services.

Rising costs have made it hard for employers to provide quality, affordable health insurance for workers and retirees,” said Health and Human Services Secretary Kathleen Sebelius.  “As a result, many Americans who retire before they are eligible for Medicare are worried about losing health insurance coverage through their former employers, putting them at risk of losing their life savings due to medical costs. This new program will provide much-needed relief so that employers can provide more retirees with quality, affordable insurance, starting this year.”


The Affordable Care Act includes $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 Americans will be able to choose from additional coverage options through the health insurance exchanges.

“The Early Retiree Reinsurance Program will invest $5 billion in financial assistance for employer health plans offered to early retirees. Lasting until the new health care exchanges created by health insurance reform law are up and running, this initiative will provide premium relief for employers while increasing access to high-quality medical coverage. As the President of the Business Roundtable said: ‘The Early Retiree Reinsurance Program reduces costs and allows many of our member companies to continue providing this critical coverage’ to retirees, and their families,”  said House Speaker Nancy Pelosi.

Both self-funded and insured plans can apply, including plans sponsored by private entities, state and local governments, nonprofits, religious entities, unions, and other employers.  Applications for the program can be accessed at the end of June.


Early Retiree Reinsurance Program Fact Sheet

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, tune into the next Affordable Care Act web chat at healthreform.gov.

Secretary Sebelius and Department of Commerce Secretary Gary Locke will host a web chat on the new Early Retiree Reinsurance Program Wednesday, May 5, at 11:30 A.M. EDT at www.healthreform.gov

WASHINGTON, May 4 /PRNewswire-USNewswire/ —  issued the following statement today on the President’s announcement on the implementation of the Early Retiree Reinsurance Program:

“Today’s announcement is good for our employers and good for America’s early retirees. Americans deserve access to quality, affordable health insurance at every age and every stage of life – and employers deserve the financial relief to do right by their employees while competing in the global marketplace.

“In recent years, the skyrocketing costs of health care have forced employers to choose between staying competitive and providing their workers and retirees with quality health coverage. In the last two decades alone, the portion of large firms covering retired employees has dropped by more than half – leaving those too young for Medicare without access to the affordable care they need.

“Congressional Republicans calling for repeal would deny America’s businesses this critical help. They want to deny early retirees the peace of mind they deserve and the ability to access quality health care. Once again, they are standing up for special interests opposed to reform and standing in the way of progress for Main Street. And we must not let those playing politics drown out the needs of America’s businesses and our middle class.”