Arizona – 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 Arizona. More applications are being approved each day.
- American Radio Association Pension & Welfare Plan
- APL Limited
- Arizona Sheet Metal Trade Trust Fund
- Arizona State Retirement System
- Blue Cross and Blue Shield of Arizona, Inc.
- Central Arizona Water Conservation District
- Chandler Health Care Benefits Tr
- City of Glendale Arizona
- CITY OF MESA
- City of Phoenix
- City of Scottsdale
- City of Sierra Vista Employee Benefit Trust
- City of Tempe
- City of Tucson
- Cochise Combined Trust (CCT)
- County of Maricopa
- County of Maricopa Temple School District 3
- Desert Schools Federal Credit Union
- Freeport-McMoRan Corporation
- Glendale Union High School District #205
- Goodwill Industries of Central Arizona, Inc.
- Henkel of America, Inc.
- Kitchell Corporation
- Lake Havasu City
- Northern Arizona Public Employees Benefit Trust
- Northern Arizona University
- Operating Engineers Local #428 Health & Welfare Trust Funds
- Phoenix Union High School District # 210
- Pima County Amphitheater Schools*
- Pinnacle West Capital Corporation
- Rural Arizona Group Health Trust (RAGHT)
- Salt River Project Agriculture Improvement and Power District
- Sheet Metal Workers Local Union No. 49 Family Heal
- Southwestern Teamsters Security Fund
- State of Arizona
- The Reinalt-Thomas Coproration*
- Tucson Electric Power Company
- United Food and Commercial Workers & Employers Ar
- US Airways, Inc.
- Valley Schools Management Group
- Yavapai Unified Employee Benefit Trust
*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.