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Early retiree reimbursement program to start accepting claims

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WASHINGTON—A $5 billion government program to partially reimburse employers for health care claims incurred by enrollees in their early retiree health care plans will start accepting reimbursement claims next week.

Government officials who spoke Thursday during a webinar sponsored by the Early Retiree Reinsurance Program said the program would be ready to accept claims as soon as Monday.

However, in order to submit claims, an employer first must file an application with ERRP and have that application approved by ERRP regulators.

In addition, employers will have to file a list of enrollees in their early retiree health plans whose claims are eligible for reimbursement, and receive a response from the ERRP in which regulators concur or disagree on which enrollees are eligible.

Once a claim is filed, government officials said a reimbursement check should be sent out within 30 days.

Regulators previously said that “plan sponsors would be able to submit their early retiree claims for reimbursement by the end of October, and they are meeting that deadline, with nearly a week to spare,” said Frank McArdle, a consultant with Aon Hewitt Inc. in Washington.

“The money should start to flow very soon,” said Rich Stover, a principal with Buck Consultants L.L.C. in Secaucus, N.J.

About 4,000 organizations, including employers, public entities and union funds, have been approved to participate in the program, which was created by the health care reform law. After a $15,000 threshold is reached, the program will reimburse 80% of claims incurred by retirees at least age 55 but not eligible for Medicare and their dependents, regardless of age, between $15,000 and $90,000.

In general, the reimbursement must be used to reduce employers’ and/or retirees’ health care costs.