Early Retiree Reinsurance Program Closes
The government will no longer be accepting applications for the Early Retiree Reinsurance Program (ERRP) after May 5, 2011. ERRP offers reimbursements to employers that have early retiree healthcare plans. For an employer’s health insurance plan to qualify for the reimbursements available under the Early Retiree Reinsurance Program, the employer’s plan must include provisions that generate (or have the potential to generate) cost savings for participants with chronic and high-cost conditions. The employer must maintain policies and procedures to detect and reduce fraud, waste and abuse and must have a written agreement in place permitting required disclosures between the plan, insurer (if applicable) and employer.
For purposes of ERRP, “early retirees” are participants in an employer-sponsored health insurance plan who are age 55 or older, are not active employees, and are not eligible for Medicare. The term includes the spouse and other dependents of the retiree, regardless of their age and Medicare eligibility. Once a retiree plan incurs $15,000 in medical claims in a plan year, the ERRP will reimburse 80% of additional claims up to a $90,000 cap.
