EARLY RETIREE REINSURANCE PROGRAM

The Department of Health & Human Services (HHS) has issued guidance on the early retiree reinsurance program, part of the new health reform law. The program will reimburse participating plan sponsors a portion ofthe costs of providing health insurance to early retirees. A plan sponsor must be ready to apply for this programas soon as HHS releases the application form. The program is funded with $5 billion; when funding is exhausted,the program will end.

Plans must be certified as acceptable. Plan sponsor applications for the program must besubmitted and approved prior to requesting reimbursements. Applications will be processed in the order in which received. Care and due diligence in completing the application are important; a complete and acceptableapplication should be filed the first time. Any incomplete application will be denied, with no opportunity to amendor fix application defects. That applicant must resubmit a new application and return to the back of the line.

Early Retiree Expenses & Program Overview
“Early retirees” are individuals age 55 or older who are not eligible for Medicare and who are not active employeesof an employer maintaining or currently contributing to an employment-based health plan. (Medicare rules on“active employment status” will apply and may disallow reimbursement for persons on disability leave, forexample.) The program will reimburse expenses of retirees’ spouses, dependents, and survivors regardless oftheir ages, eligibility for Medicare or other coverage, or dependent status for income tax purposes. The programwill operate similarly to the current Retiree Drug Subsidy program. Early Retiree PDF Download