The Department of Health and Human Services (HHS) has established a temporary reinsurance program to reimburse employers for a portion of their early retiree health program costs. Five billion dollars ($5 billion) have been allocated to reimburse eligible employers beginning June 1, 2010, and ending December 31, 2013, or sooner, should the funds be exhausted prior to December 31, 2013. The funding will be administered on a first-come, first-serve basis.

• The program applies only to retirees who are age 55 or older and are not eligible for Medicare. Their spouses and dependents are eligible irrespective of age or Medicare status.



• The program will reimburse the plan for up to 80% of costs for health benefits that are between $15,000 and $90,000 for a claimant.

The application process is highly technical and must be submitted as soon as possible. If the Board approves this agreement (see Attachment A), Aon Consulting, Inc. will immediately engage its resources (including its team of attorneys and actuaries) to gather the appropriate data and work with district staff to timely complete and submit the application.

* Demonstrate best financial practices

Potential reimbursement to the district of up to $2.8 million, which may be used to lower the district’s health plan costs.

Obtaining this funding is anticipated to be a one-time opportunity.