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Losing your retiree health benefits?

Have a plan in place

Created date

September 23rd, 2014
health file folders
health file folders

If you haven’t already, you might receive a letter from your former company about a change to your retiree health plan. Some employers have been cutting back on benefits since the early 1990s, and the trend is continuing. According to a 2013 survey conducted by consulting group Towers Watson, about 44% of companies plan to stop administering health plans for their former workers over the next two years.  

Retirees on the losing end of the deal

Often companies blame soaring health care costs, but some say terminating company-sponsored health benefits and requiring retirees to choose their own health insurance is simply a better option. “They say they are changing their benefits so that retirees can have more choices for their health insurance,” says Pamela Young, director of member services for Erickson Advantage. These options usually come in the form of broker exchanges.

Young explains how it typically works. “Companies contract with brokers that assist retirees in choosing a new health plan. Retirees may be provided with an annual sum of money often referred to as a stipend, which is deposited directly into a health reimbursement account. In many cases, the retirees need to enroll in a health plan offered by the broker to receive their stipend,” she says. “Depending on the rules governing the health reimbursement account, the money could be used for premiums, copayments, prescription drug costs, and so forth.”

There is no law preventing employers from reducing or terminating health benefits. Most pension plans, on the other hand, are considered a legal obligation.

Smart choices

It comes down to getting more bang for your buck. For many people, that may mean choosing a Medicare Advantage plan, also called Medicare Part C. These insurance plans have all the benefits included in Original Medicare (often including Part D), and some cover additional benefits beyond what Original Medicare covers. 

This insurance option is becoming very popular with Medicare beneficiaries. According to the Henry J. Kaiser Family Foundation, from March 2013 to March 2014, enrollment in Medicare Advantage plans grew by 9%, or 1.4 million people, to reach a total of 15.7 million Medicare beneficiaries.

Choosing a plan 

Medicare Advantage plans are administered by private insurance companies and the coverage includes Part A (hospital stays), Part B (doctor visits), and sometimes Part D (prescription drug coverage). Some of these plans offer additional benefits, too, such as vision and hearing aid coverage.

Erickson Advantage* offers several all-in-one Medicare Advantage plans to accommodate an individual’s varying coverage needs. Erickson Advantage is available to anyone living in an Erickson Living community. Along with Original Medicare benefits, members in most plans have coverage for head-to-toe health needs such as eyewear, dental coverage, podiatry visits, and new this year—hearing aid benefits. Some members qualify for transportation services to doctors’ visits.

Making the most of your benefits

Erickson Advantage has specially trained nurse care coordinators. They help members understand and maximize use of their benefits, and they assist members with navigating the increasingly complex health care system.

“Nurse care coordinators are one of the best benefits of having Erickson Advantage,” says Eugenio Machado, M.D., medical director at Riderwood, an Erickson Living community in Silver Spring, Md. “They follow patients closely, especially if they are hospitalized, and help them stick to their treatment plans. They communicate with everyone involved in a member’s care, and can expedite tests and facilitate specialists’ appointments.”

Although there is pending legislation to change this rule, Medicare beneficiaries must be in the hospital for three consecutive nights before they qualify for a rehabilitation stay. Erickson Advantage members, however, have no waiting period. “We can admit our patients directly into rehabilitation if they are an outpatient or have been in the hospital for only one day,” Machado explains. 

For Erickson Living residents

You can find out more about Erickson Advantage by contacting a sales agent at your Erickson Living community. These agents can also help you review your current coverage and determine if Erickson Advantage would be a good fit for you. They can also tell you if they think another plan would be more cost-effective and beneficial for your health needs.

“Even if you don’t choose Erickson Advantage,” Young says, “it’s important to do a yearly checkup of your insurance plan, especially if your company has transitioned to enrollment through broker exchanges. If you lose your insurance from your company, you may qualify to enroll in a different plan outside of the standard enrollment period.”  

Open enrollment is October 15 through December 7.

*Plans are insured through UnitedHealthcare Insurance Company or one of its affiliated companies, a Medicare Advantage organization with a Medicare contract. Enrollment in the plan depends on the plan’s contract renewal with Medicare. The benefit information provided is a brief summary, not a complete description of benefits. For more information, contact the plan. Limitations, copayments, and restrictions may apply. Benefits, formulary, pharmacy network, provider network, premium and/or co-payments/co-insurance may change on January 1 of each year.