West Virginia – Early Retiree Reinsurance Program
Rising health care costs have made it difficult for employers to provide quality, affordable health insurance for workers and retirees while also remaining competitive in the global marketplace. The percentage of large firms providing workers with retiree health coverage has dropped from 66 percent in 1988 to 29 percent in 2009.1 Health insurance premiums for older Americans are over four times more expensive than they are for young adults,2 and the deductible these enrollees pay is, on average, almost four times that for a typical employer-sponsored insurance plan.3
The Affordable Care Act creates a new program called the Early Retiree Reinsurance Program to help address this challenge that employers and older employees are facing. The Early Retiree Reinsurance Program provides $5 billion in financial assistance to employers and unions to help them maintain coverage for early retirees age 55 and older who are not yet eligible for Medicare.
Businesses, other employers, and unions that are accepted into the program will receive reimbursement for medical claims for early retirees and their spouses, surviving spouses, and dependents. Savings can be used to reduce employer health care costs, provide premium relief to workers and families, or both. Applicants who are approved into the program receive reinsurance for the claims of high-cost retirees and their families (80 percent of the costs from $15,000 to $90,000). The program ends on January 1, 2014 when State health insurance Exchanges are up and running.
HHS has approved the following sponsors from West Virginia. More applications are being approved each day.
- Building Trades Welfare Fund for the Ohio Valley
- Century Aluminum of West Virginia, Inc.*
- City of Beckley
- City of Charleston, WV*
- City of Huntington WV
- City of Wheeling
- Employer-Teamsters Local Nos. 175 & 505 Health & W
- Highmark West Virginia Inc. dba Mountain State Blue Cross Blue Shield
- IUOE Local 132 Health & Welfare Fund
- Severstal Wheeling, Inc.
- Special Metals Corporation Salaried Employees Welfare Plan
- SWVA, INC.
- The 1978 Retired Construction Workers Benefit Trust
- The Association of Non Represented Salaried Retirees of Weirton Steel
- The Fenton Art Glass Company
- UFCW Local 400 & Employers Health and Welfare Fund
- United Bankshares, INC.
- W. Va. Laborers (Health & Welfare) Trust Fund
- West Virginia Department of Administration/PEIA
- West Virginia Pipe trades Health & Welfare Fund
- Wheeling-Pittsburgh Steel Corporation Retiree Benefits Plan
*New program participants as of May 24, 2011. List to be updated monthly.
[1] Kaiser / HRET. Employer Health Benefits: 2009 Survey.
[2] Center for Policy and Research. Individual Health Insurance 2009.
[3] Kaiser Family Foundation. 2010. Survey of People Who Purchase Their Own Insurance.