The Department of Health and Human Services ("HHS") recently published a draft application for the Early Retiree Reinsurance Program (the "Early Retiree Program") on the HHS website. The Early Retiree Program, introduced under the Patient Protection and Affordable Care Act ("PPACA"), provides reimbursement to participating plan sponsors for a portion of the costs of providing health coverage to early retirees ages 55 - 64 and their eligible spouses, surviving spouses and dependents who are not yet eligible for Medicare. The Early Retiree Program provides up to $5 billion in financial assistance to plan sponsors and the Secretary of HHS will reimburse plans in an amount of 80% of the portion of health benefits costs attributable to claims between $15,000 and $90,000 (with such amounts being indexed for plan years starting on or after October 1, 2011) for each retiree (and their spouse and dependents), each plan year. Plan sponsors must use the reimbursement to reduce plan participant or sponsor health care costs, or a combination of such costs. The Early Retiree Program becomes effective June 1, 2010 and will end upon the earlier of January 1, 2014 or when the available $5 billion is exhausted.
The application process has not yet been opened, but will begin sometime prior to June 30, 2010. The date on which applications will begin to be accepted, along with information as to how and where to send completed applications, will be posted on the HHS website in the coming weeks. Employers interested in applying to the Early Retiree Program should review the draft application and begin collecting the necessary information to complete an application as HHS has stated that applications will be processed in the order in which they are received, and incomplete applications will be denied and must be resubmitted.
The draft application may be accessed here. For more information on the Early Retiree Program, please see Parker Poe's previous article on the topic here.