The Obama administration said that nearly 2,000 employers and unions have been accepted in the first round of the $5 billion Early Retiree Reinsurance Program created under the health care reform bill.
The program aims to help employers provide health insurance to early retirees age 55 or older who are not yet eligible for Medicare. The Department of Health and Human Services announced that companies such as PepsiCo, Pfizer, GM, and Deutsche Bank Americas have qualified for the program.
The $5 billion program, created by the Affordable Care Act, provides financial assistance for employers, including large and small businesses, state and local governments, educational institutions, non-profit organizations, and labor unions that will help retirees and their spouses, surviving spouses, and dependents, as well as active employees and their families, continue to have access to affordable health coverage.
There has been a tremendous amount of interest from businesses and organizations from across the country since the Early Retiree Reinsurance Program was announced just a few months ago, said Commerce Secretary Gary Locke on the White House blog. We have received applications from more than half of Fortune 500 companies, all major unions, and government entities in all 50 states and the District of Columbia, and we are delighted to be able to notify our first round of successful applicants. As of today, nearly 2,000 employers and unions have been accepted into the program.
Two new information tools are available for employers and unions interested in the Early Retiree Reinsurance Program: a new website (www.ERRP.gov) and a new hotline (877-574-3777 or 877-574-ERRP).
"As employers continue to drop retiree health benefits, early retirees have become extremely vulnerable to losing their insurance. At the same time, these older Americans are the least likely to find affordable coverage in the individual market, said Ways and Means Health Subcommittee Chairman Pete Stark, D-Calif., in a statement. "Health reform provides new financial assistance to employers who maintain their retiree health benefits. Two thousand employers have already signed up to obtain this help. This early retiree assistance program is yet another way that health reform is making people's health coverage more secure now."
The Affordable Care Act created the Early Retiree Reinsurance Program to provide financial assistance to employers to help them continue coverage for early retirees. Employers who are approved to participate in the program receive reinsurance for the claims of high-cost retirees and their families. These funds can be used to provide relief to retirees, workers and their families, in the form of lower premiums and cost sharing.
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