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Centers for Medicare & Medicaid Services

States-EERP

Kentucky – 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 Kentucky. More applications are being approved each day.

  • AFL-CIO Health & Welfare Fund
  • Ashland Inc.
  • Bargaining Assoc Steelworkers Local 14614
  • Board of Trustees of UFCW Local 227 Employers Hlth and Welfare Pln
  • Bricklayers of Indiana Welfare Fund
  • Brown-Forman Corporation
  • Catholic Health Initiatives (CHI)
  • Century Aluminum of Kentucky General Partnership*
  • Commonwealth of Kentucky
  • EON U.S. LLC
  • Glass, Molders, Plastics International Union
  • Humana Inc
  • International Union of Operating Engineers, Locals 181, 320 & TVA Health
  • Kentucky Bankers Association
  • Kentucky Education Association
  • Kentucky Laborers District Council Health & Welfare Fund
  • LBCE Holdings, Inc.
  • Lexmark International, Inc.
  • Members Heritage Federal Credit Union
  • Paxton Media Group LLC
  • Plumbers & Pipefitters Local 502 Health and Welfare Plan
  • Plumbers & Steamfitters Local Union #248 Health & Welfare Trust Fund
  • Plumbers and Steamfitter Local Union 452
  • Plumbers and Steamfitters Local 577
  • Plumbers and Steamfitters Local Union 452
  • Plumbers and Steamfitters Local Union 452 Health & Welfare Trust Fund
  • Publishers Printing Company, LLC.
  • South Kentucky Rural Electric Co-Operative Corporations
  • Texas Gas Transmission, LLC
  • The Teachers' Retirement System of the State of Kentucky
  • United Association of Plumbers and Pipefitters Local 633
  • University of Kentucky
  • University of Louisville
  • Uranium Disposition Services, LLC
  • Warren Rural Electric Cooperative Corporation
  • YUM! Brands, Inc.
  • Zeon Chemicals L.P.

[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.

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