Can managed care reduce employers' retiree medical liability?
The Financial Accounting Standards Board (FASB) has forced U.S. companies to look squarely at their current retiree health obligations and their future commitments. Accounting Statement No. 106 (FAS 106) requires employers to accrue liabilities for retiree health benefits during employees' active service, rather than record the costs as benefits are paid. Employers are scrambling to find ways to reduce the statement's effect on corporate balance sheets. While managed health care has been increasingly employed to control benefit costs in active employee health plans, it has not been as popular in retiree plans. This article reviews important demographic and health trends in the retiree population and summarizes employers' early responses to FAS 106. It explores why managed health care has thus far played a limited role in reducing employers' postretirement medical liability, and offers insight into how that role could be increased in the future.
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D000066:Accounting / Q000592:standards*; D000368:Aged; D003256:Community Participation / Q000191:economics; D017046:Cost Savings / Q000706:statistics & numerical data; D003625:Data Collection; D017049:Employer Health Costs / Q000706:statistics & numerical data; D006264:Health Benefit Plans, Employee / Q000191:economics*; D006801:Humans; D008329:Managed Care Programs / Q000191:economics* / Q000706:statistics & numerical data; D006278:Medicare / Q000191:economics; D012179:Retirement / Q000191:economics*; D012959:Socioeconomic Factors; D014481:United States