States Getting Biggest Piece of ERRP Pie

March 2, 2011 ( – New data released Wednesday indicates the largest share of the $535 million given to employers to help fund early retiree health care costs has gone to state government-sponsored entities.

The U.S. Department of Health and Human Services (HHS) report indicated those payments to 253 approved plans were followed by payments to non-profit, commercial, union, and religious organizations. Payments under the Early Retiree Reinsurance Program (ERRP) made to individual sponsored plans ranged from $285.13 to $108.6 million for claims in 2010. Approved sponsors sought reimbursement for the claims associated with 60,859 individuals who had total plan costs that exceeded the $15,000 ERRP threshold.

According to HHS, as of December 31, 2010, more than 5,000 employers had been accepted into ERRP. ERRP reimburses participating plan sponsors for a portion of health coverage costs for early retirees and their spouses, surviving spouses, and dependents.

The program allows plan sponsors to either reduce costs of health care for plan participants or the costs to the plan sponsor to help them keep their coverage. For example, approximately 80% of plans that received reimbursements are using some or all of those dollars to lower the cost of health care for plan participants. 

The report is at A list of approved plan sponsors, updated on January 27, 2011, is available online at