A further sign of the impact the health care reform law is having on employer-sponsored health plans.
3M retirees not old enough to qualify for Medicare by 2015 will be dropped from group health coverage and instead be allowed to enroll in a health reimbursement arrangement, the manufacturer announced on Oct 1, the Wall St. Journal reported today.
3M said the change was necessary because “the recently enacted health care law has fundamentally changed the health care insurance market” and “readily available individual insurance plans in the Medicare marketplace provide benefits more tailored to retirees’ personal needs often at lower costs than what they pay for retiree medical coverage” through the company.
The HRAs will be timed to roughly coincide with the creation of health care “exchanges” in 2013 — the marketplace in which consumers will be able to purchase health care — mandated under the Patient Protection and Affordable Care Act.
It’s a potential win-win all around. 3M gets out from under costly group health insurance, while the retirees get to shop around for the best price and coverage, seeded with employer money in the HRA.
