By Joseph DeinleinThe Daily Item
Bucknell University could get about $200,000 from a new federal program that subsidizes health-care costs for employees who retire too early to qualify for Medicare.
More than a dozen school districts, as well as dozens of municipalities and state agencies, joined large and small businesses and colleges on the list of 103 Pennsylvania enrollees announced Tuesday. Aside from Bucknell, none on the list were from Montour, Northumberland, Snyder or Union counties.
Public school officials contacted about the federal Early Retiree Reinsurance Program said they had either not heard of the program or didn't know it applied to school districts. Officials said they were intrigued by what could be a major savings to local taxpayers.
Selinsgrove Area School District is paying about $736,000 this school year for 60 retirees, said business manager Jeff Hummel.
"It's something we'll definitely look into," he said.
Bucknell is among the 2,000 applicants accepted nationwide in the first round of the Early Retiree Reinsurance Program, according to a news release from the U.S. Department of Health and Human Services. The list includes educational institutions, school districts, state and local governments, large and small businesses, nonprofits and unions.
The program was created by the Affordable Care Act to encourage groups to continue covering early retirees until the new health insurance exchanges start in 2014. Using a $5 billion pot, the federal government will subsidize the selected employers over a certain dollar amount to maintain coverage for retirees age 55 and older who aren't yet eligible for Medicare.
The program also extends to those retirees' spouses, surviving spouses and dependents. It will cover expenses beginning June 1 and it ends on Jan. 1, 2014, when the exchanges are to be up and running.
"Many Americans who retire before they are eligible for Medicare see their life savings disappear because of medical bills and exorbitant rates in the individual health insurance market," said Kathleen Sebelius, Health and Human Services secretary.
The amount reimbursed is up to 80 percent of claims costs above a $15,000 threshold, and can be no more than $90,000, according to www.healthreform.gov.
To participate, an employer must complete an application detailing claims for early retirees. The applicant also must show preventive care programs in place at the employer that have or could reduce the cost of care for those with chronic illness and high-cost conditions, the health reform website states.
Bucknell was the only organization from the Valley to be accepted, though it is unclear if other employers applied. As a matter of policy, federal agencies generally do not discuss those who applied and weren't accepted to federally funded programs.
"Any employer can continue to apply," said Keith Maley, a spokesman for Health and Human Services. "So the folks in the region who have not applied and want to still can. If they applied and weren't accepted it doesn't mean they won't be in the future."
There are no set number of rounds for the program, he said. Employers will be reviewed and accepted until there is no money left or federal health reforms begin.
"As applications come in, we want to get them (reviewed), approved and announced as quickly as possible," Maley said.
Bloomsburg and Susquehanna universities did not apply for the program because they did not have any retirees that fit the specifications, spokeswomen at each school said.
Bucknell has a little fewer than 60 early retirees to whom it provides health coverage, said David Myers, university chief of staff. The tab is about $330,000 per year, he said.
"It's a fairly significant cost for us," he said. "These are older people, and are more likely to make use of health insurance. They go to the doctor more often, and have more significant care needs."
The university expects to get about $200,000 per year, though that could be more or less depending on the actual health needs of the retirees, he said.
Application was suggested by the university's health-care adviser, and two people filled out the application form, Myers said. It took some time, but is worth it, he said.
Sebelius said the goal of the program is to not lose health coverage for anyone who already has it.
Already, the percentage of large firms providing workers with retiree coverage has dropped from 66 percent in 1988 to 29 percent in 2009.
 "The Affordable Care Act's Early Retiree Reinsurance Program will make it a little easier for employers to provide high-quality health benefits to their retirees as we work to put in place market reforms to lower costs for all," Sebelius said.
-- E-mail comments to jdeinlein@dailyitem.com
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