The CMS also released a new report announcing that the ERRP has provided more than 1,300 employers across all 50 states with nearly $1.8 billion in reimbursements. The report details reimbursements received by each participating plan sponsor.
According to a CMS press release, most of the individual ERRP payments made in 2010 were for less than $1 million, and 43% of individual payments were for less than $100,000. In addition to the smaller payments, larger plans covering millions of retirees – including private corporations, state governments, and multi-employer welfare plans – received large reimbursements that have provided essential support as they struggle to maintain coverage and keep costs low. One large employer reported that ERRP reimbursements provided a 3% premium discount for retirees, a savings of up to $200 million.
“We are thrilled with the success of the Early Retiree Reinsurance Program and excited that we are helping maintain coverage and moderate costs for millions of American workers and retirees,” said Steve Larsen, director of the Center for Consumer Information and Insurance Oversight (CCIIO) at CMS, which administers the program, in the press release. “Insurance for older Americans is over four times more expensive than coverage for young adults and we are happy that this program is helping employers maintain coverage.”
A Congressional report issued last week predicted that the program would run out of money this year (see Retiree Reinsurance Program Funds May be Gone in 2011).The CMS report is at http://cciio.cms.gov/resources/files/errp_progress_report_3_31_11.pdf.