3M to give some retirees vouchers for health care 'Reimbursement Arrangement' to replace company

[speppin]

Unintended consequences of the new 'reform'


http://www.twincities.com/newsletter-morning/ci_16253553?nclick_check=1


3M to give some retirees vouchers for health care
'Reimbursement Arrangement' to replace company plan


By John Welbes
[e-mail]
Updated: 10/05/2010 10:43:41 AM CDT

3M Co. will stop offering some retirees the option of participating in its company-sponsored health care plan starting in 2013 and start offering cash through a health reimbursement account instead.
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3M said Monday that starting Jan. 1, 2013, 3M retirees eligible for Medicare coverage will receive a "Health Reimbursement Arrangement" instead of the 3M retiree medical plan.

Starting Jan. 1, 2015, the same change will take effect for retirees who aren't yet eligible for Medicare. The changes affect current and future 3M retirees. 3M has 23,000 retirees in the U.S.

3M declined to say Monday how much it would contribute to health reimbursement accounts and what that would cost versus employee participation in the existing 3Msponsored health care plan.

employees last week, 3M said the recently enacted national health care reform "has fundamentally changed the health care insurance market." Insurance companies won't be able to deny coverage based on pre-existing conditions, coverage will be available through government-regulated exchanges and there will be limits on how much premiums can vary based on age.

Because of those types of changes, the 3M-sponsored plan for retirees ineligible for Medicare "will no longer have the advantages over the individual marketplace that they once did," 3M said in the letter.
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[itsrobert]

1. Makes sense

What's the problem. Healthcare is still being provided.

[DURHAM D]

2. Well - it remains to be seen if this is the reality:

"Insurance companies won't be able to deny coverage based on pre-existing conditions, coverage will be available through government-regulated exchanges and there will be limits on how much premiums can vary based on age."

Coverage that costs $6,000 a year with a $10,000 deductible isn't really "coverage".

[zipplewrath]

3. No, it's not

At best a strange form of health insurance is being provided, although it doesn't sound like that's what it is. Sounds more like some form of company funded HSA. But there is nothing about health care in there anywhere.

[harun]

4. I think they had planned to do this before any of the recent legislation. They are just

using the recent legislation as a reason for something they already planned to do. As other companies are doing as well. Now any health care changes being made are "because of Obamacare". So people will blame Obama instead of the companies.

I am not totally blaming the companies here. Cost's are so far off the charts many of them don't have a chance in paying. Too bad Dem's didn't do Health Care Reform and instead did Health Insurance Reform.

[speppin]

5. does not even hold a pickle to have health insurance reform when

prices are being jacked up year by year. One of the chief complaints of the reform is that it had no or inadequate price controls in it. Now we are seeing that complaint come to life.

[LiberalFighter]

6. It will result in insurance companies making it worse and their own demise.

Then insurance companies will be completely eliminated and then providing something more along the line of single payer.

[frazzled]

7. 3M declined to say how much it would contribute "

I'm not sure how this works. Are they saying they will give the retirees a pool of money, with which they can go to exchanges and buy an individual insurance policy? Or are they offering to set up a "health medical care account."? If the latter, I'd say you'd have to be nuts to take it.

Retirees not yet eligible for Medicare are most likely in the 55-64 range--an age when anything can happen medically.

Say 3M offers to put $10,000 each year into an account for them, as opposed to paying $10,000 to an insurance company. With the insurance plan, that $10,000 could buy you hundreds of thousands of dollars of medical care--now, with the Affordable Care Act limitless healthcare, actually. In the account, it will buy you $10,000--the cost of a single trip to the emergency room with an overnight stay in the hospital. (How do I know this? My husband was recently sent to the ER for an infection, and was hospitalized for one day as a result: the bill was $9,300.)

Maybe I'm not getting this. I do think that funding health care for retirees is very difficult and expensive for companies, but I don't understand what is being offered here well enough.