3M To Stop Offering Health Insurance Plans to Retirees Effective in 2013
Posted Oct 04 2010 8:43am
Last week we had McDonalds and this week it is 3M. As healthcare reform keeps moving it’s getting more difficult to project for companies to identify if they can or want to afford employer based insurance as we can see from this latest move. Perhaps we are eventually going to end up with a single pay plan by default if we keep seeing efforts going in this direction. For employers too, the employee benefits area of human resources is becoming an administrative nightmare too. It doesn’t seem to appear that anyone likes the complexity and algorithmic formulas today that are required for even the processing of the smallest claim submitted.
This is pretty much what we are looking at today with our bodies and risk assessments to see if they fit the model that has been laid out and those who are not perfect fits are problems. We all know as we get older, we have more things that can go wrong and thus we get more expensive to have on the rolls.
A good example on how complicated issues get is the City of Buffalo to where they paid over 2 Million dollars worth of premiums for “dead” employees, so here we go back again to the data. You also wonder why in that amount of time that the insurer did not see anything as well, but kept collecting the money. I am surprises that none of those dead employees were flagged for missing their mammograms and psa tests, it does make you wonder.
All of this would have happened anyway with or without healthcare reform as the current economic conditions and technology influence would have demanded this anyway and plans as such are outside the walls and rules of reform anyway, so can’t blame this on reform, it’s the flat out economy and saving money.
It looks like all of us just can’t get healthy fast enough to meet those cost algorithms and there needs to be additional concessions here too on drug and device pricing to make all of this work too. BD
3M Co. confirmed it would eventually stop offering its health-insurance plan to retirees, citing the federal health overhaul as a factor.
The changes won't start to phase in until 2013. But they show how companies are beginning to respond to the new law, which should make it easier for people in their 50s and early-60s to find affordable policies on their own. While thousands of employers are tapping new funds from the law to keep retiree plans, 3M illustrates that others may not opt to retain such plans over the next few years
"In addition, health care reform has made it more difficult for employers like 3M to provide a plan that will remain competitive," the memo said. The White House says retiree-only plans are largely exempt from new health insurance regulations under the law.