A pivotal year for managing retiree medical benefit costs.
With Medicare set to begin offering a prescription drug benefit in 2006, employers that provide medical coverage to retirees aged 65 and older have a unique opportunity to redefine their programs and financial commitments for the long term. The new Medicare Part D drug benefit poses a range of alternatives for employers to consider--from eliminating post-65 drug benefits altogether to maintaining or modifying their current programs to qualify for the 28% federal tax subsidy for eligible drug costs. In deciding on a course of action, companies need to consider a host of complex issues, including workforce needs and demographics, employee relations, plan design and administration--in addition to the long-term financial and accounting implications. This article reviews the alternatives available to employers with the advent of Medicare Part D and highlights some of the key factors employers should consider as part of this decision.
Fontanetta
Ron
R
Towers Perrin's HR Services, New York, USA.
D003363:Cost Control / Q000458:organization & administration*; D006264:Health Benefit Plans, Employee / Q000191:economics* / Q000458:organization & administration; D006801:Humans; D012179:Retirement; D014481:United States