According to a UnitedHealth news release, the new product includes health benefits provided through a group policy regardless of health status. The new plan also diminishes and caps employers’ financial liability for providing retiree coverage, the announcement said.
Both employers and employees plan for their retiree health coverage using a pre-tax, fixed subsidy approach during active employment. Then, at retirement, the employees have access to major medical coverage without medical review and can use funds from the account to pay the ongoing costs of the medical plan, according to the announcement.
The employer can use a variety of account options to fund the program, such as a Health Reimbursement Arrangement (HRA), cafeteria plan or credit system. By using an account such as an HRA, any remaining funds in this pre-65 account can then be applied toward post-65 coverage, the company said.
Uniprise, the division of UnitedHealth Group that serves large national employers, will administer the program and United Healthcare Insurance Company will underwrite the coverage.
“Large employers are looking for innovative ways to provide their employees with access to retiree health coverage,” said Tracy Bahl, CEO of Uniprise. “With this new program, companies will be able to deliver access to medical coverage to their early retirees, while still reducing the businesses’ overall health care costs. At a time when employer-funded retiree health benefits are becoming increasingly rare, we are designing easily accessible and affordable coverage.”
More information about UnitedHealth is at http://www.unitedhealthgroup.com/ .