A Tale Of Two Health Reform Provisions

For reasons that are not all that obscure, two provisions in the Patient Protection and Affordable Care Act (ACA), one aimed at aiding individuals and the other aimed at aiding group health plans, have had strikingly dissimilar results.

As discussed in this blog recently, the Pre-Existing Condition Insurance Plan (PCIP), a temporary high risk health insurance pool for individuals, has a total U.S. enrollment of just over 18,000 individuals, even though estimates of individuals eligible for the program run as high as 5 million. The PCIP requires that an individual be uninsured for six months and plans available often are expensive, thus the low enrollment.

A distinctly different result has been obtained by the Early Retiree Reinsurance Program (ERRP). Group health plans that provide early retiree health coverage are eligible, and reimbursement is available after applying for the program and submitting reimbursement requests—no other strings attached.

In the first 13 months after enactment of the ACA, the Early Retiree Reinsurance Program has made more than $2 billion in reimbursements to 1,728 approved retiree plans, according to a May 2011 report from the Center for Consumer Information & Insurance Oversight (CCIIO).

This is almost three and one-half times the amount of reimbursements recorded at the end of 2010, and includes almost six times more retiree plans.

Retiree plans that received the most reimbursement so far have included public employee systems, unions, and older, more established corporations.  Those plans that have received more than $10 million of the total $2.438 billion in reimbursements include the following:

·        United Auto Workers Retiree Medical Benefits Trust, $220,717,912.70

·        AT&T, Inc., $141,522,095.91

·        California Public Employees' Retirement System (CalPERS) $98,717,679.82

·        Verizon Communications Inc., $91,702,537.71

·        Public Employees Retirement System of Ohio, $70,557,763.84

·        Teacher Retirement System of Texas, $68,074,117.64

·        Commonwealth of Kentucky, $63,420,419.65

·        State of New York, $47,869,043.62

·        Teachers & State Employees, Board, Major Medical Plan, NC, $45,298,812.63

·        State of New Jersey Treasury Department, Pension Accounting Services Department, $38,622,697.74

·        General Electric Company, $36,607,818.08

·        State of Michigan Public School Employees Retirement System, $33,616,554.94

·        The Boeing Company, $34,097,111.22

·        Employees Retirement System of Texas, $30,175,627.20

·        South Carolina Budget & Control Board Employee Insurance Program, $27,142,501.66

·        General Motors, LLC, $26,774,741.50

·        National Carriers' Conference Committee, DC, $25,247,080.98

·        Commonwealth of Pennsylvania, $24,522,631.20

·        Qwest Communications International Inc., $23,584,496.39

·        State Teachers Retirement System of Ohio, $20,334,357.02

·        State of Michigan, $20,247,338.29

·        Wisconsin Education Association Insurance Trust, $18,129,508.49

·        Trustees of the Central States, SE & SW Areas Health and Welfare Fund, IL, $16,983,697.88

·        Deere & Company, $14,240,067.59

·        Wisconsin Retirement System, $14,237,183.91

·        Public Education Employees Health Insurance Fund , AL, $13,011,375.86

·        Public Employees' Retirement Association of Colorado, $12,297,560.30

·        International Business Machines Corporation ("IBM"), $12,989,690.40

·        EI duPont de Nemours and Company, $12,796,589.00

·        United Parcel Service of America, Inc., $12,312,872.80

·        Washington State Health Care Authority, $12,279,128.17

·        Mississippi Department of Finance and Administration, $11,790,014.37

·        Altria Client Services, Inc., $10,995,718.71

·        The Regents of the University of California, $10,704,323.57

·        Alcoa, Inc., $10,654,650.05

·        United Airlines, Inc., $10,269,716.48

·        Sisc III Health and Welfare Fund, $10,207,959.84

For a comprehensive analysis of the Patient Protection and Affordable Care Act, including the full text of the law and additional information on health reform implementation and other recent developments in employee benefits, just click here.