Retiree Medical Coverage

[Guest jdeets]

We currently offer retiree medical coverage, which includes an option for retirees to select a medical risk HMO option, which is available to retirees aged 65 and older. If the retiree's eligible dependents are not age 65, however, they must remain under the regular indemnity plan for retirees. We would like to change the plan's eligibility provisions to provide that a former employee may NOT select the medical risk HMO option at age 65, unless all of his eligible dependents are age 65 or over. The reason is to simplify the administration of the plan. Does anyone see any problem with this?

[Guest nac]

Why would you do that? Admin costs aside, it's more cost-effective to shift the risk to Medicare Risk for anyone over 65. We allow split coverage for over/under 65's for just this reason. Even with Medicare carve-out, you're still looking at an average over-65 cost of about $1900 per year.

I'd seriously look at a cost/benefit analysis before making that kind of decision.