Early Retiree Reimbursement Program Exclusions Released

Federal regulators have provided an initial list of health care services that are excluded from a program to partially reimburse employers for claims by early retirees and their dependents.

The Department of Health and Human Services released the excluded-service list September 29, calling it only a “general guide” and saying additional guidance may be issued as the program is implemented.

Under the Early Retiree Reimbursement Program established as part of the health care reform law, the federal government will reimburse employers for claims incurred by retirees at least age 55 and not yet eligible for Medicare as well as their dependents, regardless of age.

After a participant incurs $15,000 in health care claims in a plan year, the government will reimburse early retiree health care plan sponsors for 80 percent of claims up to $90,000.

The reimbursement applies to claims incurred June 1 or later. In general, the reimbursement must be used to reduce employers’ and/or retirees’ health care costs.

However, certain health care services that are not covered by Medicare will not be credited toward the $15,000 threshold or reimbursed under the program, HHS said.

Some of the excluded services are:
• Custodial care, such as personal care by individuals who are not medically trained.
• Routine foot care, such as orthopedic shoes.
• Personal comfort items, such as a television in a hospital room.
• Hearing aids and auditory implants.
• Cosmetic surgery, except when required to quickly repair an accidental injury or improve function of a malformed body part.
• Routine dental service.
• In vitro fertilization and artificial insemination.
• Abortions, except if the pregnancy resulted from rape or incest or endangers the woman’s life.

Currently, more than 2,000 organizations have been approved for the program to which
Congress allocated $5 billion. The Employee Benefit Research Institute in Washington has estimated that the money will run out next year.  

Filed by Jerry Geisel of Business Insurance, a sister publication of Workforce Management. To comment, e-mail editors@workforce.com.

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