Saturday, December 11, 2010

ERRP Fails to Stem Rise in Uninsured

The headline read, "City Workers May Drop Coverage."  San Angelo's early retirees are in the same sinking boat as workers.  Retiree-dependent health insurance premiums soared 34% to 58% for the City of San Angelo, an Early Retiree Reimbursement Program (ERRP) recipient. ERRP is intended to keep health insurance premiums more, not less affordable.

The City came up with $318,000 between Council meetings to cushion the $1 million blow. However, 70% of the cost increase was passed onto workers and early retirees. GoSanAngelo reported new rates for retiree dependents (on a high deductible plan):

                                  2010        2011    Percent Increase
Retiree-Spouse      $377.31    $506.64    34.28%
Retiree-Children    $240.26     $342.63    42.61%
Retiree-Family      $435.58     $691.27    58.70%

The City hemmed and hawed on ERRP, keeping City Council members in the dark and completely mischaracterizing the program as "a lottery."

It's akin to stop-loss coverage, which the City dearly counts on.  ERRP funding is not the least bit questionable.  ERRP began accepting claims for reimbursement the end of October and promised a 30 day turn around time for payment. 

The end result is the City will bank 19 months of ERRP funding before sharing any proceeds, while 51 retiree-dependents struggle to keep health coverage.. 

To maximize ERRP funding, the City would work to keep early retirees in the plan, not drive them away with massive rate increases.

Employee-dependent rates also soared.

Employee-Family plans skyrocketed 48% to 58%.  Human Resources brought CHIP applications to their employee "open enrollment" meetings.  The City suggested government health insurance for those now unable to afford their portion of an employee benefit, 280 employees with some form of dependent coverage. 

Given Texas' budget woes, CHIP insurance premiums will likely soar, as well.  That's if Texas doesn't pull an Arizona and eliminate the plan altogether.

One thing is clear.  Employers continue shifting the burden to struggling individuals.  America's legions of uninsureds will grow until 2014.

Update 12-12-10:  Another retiree expects no help from ERRP.  This one is from GM.

Update 1-12-11:   According to a letter sent Wednesday by HHS Secretary Kathleen Sebelius, Department of Labor Secretary Hilda Solis and Treasury Secretary Timothy Geithner, HHS began making reimbursements late last year and as of Dec. 30 said it had paid out about $1 billion.  Has the City of San Angelo received its first check?

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