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Large companies offering health insurance to early retirees?
Old 07-08-2008, 12:55 PM   #1
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Large companies offering health insurance to early retirees?

Interesting concept:
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Why the sudden interest? With boomers approaching retirement, insurers sense opportunity: At 65, early retirees become eligible to buy lucrative policies that supplement or replace Medicare. "We want to cover them for the rest of their lives," says Kenneth Sperling, senior vice-president at Cigna's Senior & Retiree Services.
An initiative introduced by insurer Aetna (AET) and a group of major companies on Jan. 1 is expanding early retirees' access to coverage. Under the plan, called Retiree Health Access, several employers are banding together to help their retirees, pre- and post-65, buy insurance at discounted group rates.
By offering these benefits, companies earn goodwill with employees while also creating an incentive for older workers—who may be burned out or more expensive than potential replacements—to leave the payroll. According to Mercer, those with company-provided coverage retire, on average, at age 61; those without benefits tend to hang on until age 63.
Has anyone on the board actually taken advantage of this "trend" yet?


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Old 07-08-2008, 12:58 PM   #2
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If it's unpatriotic to retire early, and these companies are hoping to create an incentive for people to retire early, should we be investigating them for unamerican activities?

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Old 07-08-2008, 01:18 PM   #3
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I'd imagine the adverse selection in such a plan will turn out to be horrific. I suspect many of the healthiest early retirees will choose an individual plan at a considerable savings, which would leave the least healthy and most uninsurable in the "group" plan.

The economics of this seem untenable; it almost seems like it would turn into a "Risk Pool Lite." I wish them luck in finding a way to make (and keep) this affordable, but I don't see the numbers working without an employer subsidy...
"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)
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Old 07-08-2008, 06:45 PM   #4
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Last year DH's company announced that anyone who has worked there for 5 years or more (or was it 10?) can be part of their health insurance group when they reach age 50 if they don't work there anymore. The company doesn't pay anything towards it though.

Of course, it is a rather expensive option, so we will probably end up with something else. But, if does give me peace of mind that we will be able to get insurance even if the other options fail.
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Old 07-08-2008, 06:59 PM   #5
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The municipality that I ER'd from offers health insurance for life to all of it's retirees, whether ER or regular, and has since at least the late 60's or early 70's. The retiree has to pay a percentage of the monthly premium, and that percentage is based on what the contract that you retired under stated at that time. I pay 25%, some who retired some years before me under a previous contract pay 50%. Just for some perspective, while I was working I paid 20%......those who are now paying the 50%, were paying anywhere between 0% and 15%. It all depends on the contract terms at time of retirement. I pay $152/month for full medical/dental coverage.

They also enthusiastically support ER by offering an Early Retirement Incentive (ERI) package about every 5 years.

They make no bones about the fact that the ONLY reason they offer the ERI and health insurance for life, is to get rid of those who have a lot of years of service and therefore more benefits and much higher longevity pay, as well as more stipends for various licenses, certifications, and job classifications. In other words, us 'old-timers' cost 'em too much scratch!

Since they make no bones about there stance, I make no bones about my stance. That being that I like my former employer MUCH MORE now than at any time while I was working there! Heck, I think I love 'em now! Proof of the old saying......"Absence Makes The Heart Grow Fonder".
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