Funny Stuff with LLNS Benefits for Retired Folks

Hi Frank,
I can't believe this has not already been noticed but, I don't see it in the blog. I got this off of the LLNS blog, obviously.... Could this also be done here????? If so this is huge.
-Anonymous

LLNS is keeping us in the dark as much as possible on health care options and costs. My wife and I are both Medicare-eligible, so we received the Medicare-eligible packet on October 28. I don’t know what options employees are getting, or the under-65 retirees. I talked to an employee friend, and he said the packet he received did not contain very much information.

Our packet said that all Medicare-eligible retirees are being dumped from the group health insurance plans effective next January 1. LLNS is moving to a defined contribution health plan instead of a defined benefit group plan for us Medicare retirees. What LLNS will provide us is a family Health Reimbursement Account (HRA), into which they will contribute $2400 in 2009 for each Medicare insured person (usually self or self plus spouse). We are responsible for purchasing individual Medicare supplement insurance or a Medicare Advantage plan, and Medicare pharmaceutical insurance, from an administrative management company “Extend Health” which LLNS has an arrangement with. We pay the premiums and get reimbursed from our HRA to the extent that the funds are sufficient. If anything remains, we can use that for other health care expenses (deductibles, copays etc.).

The biggest message in the packet is that Medicare retirees MUST contact Extend Health to select and enroll in a medical plan. If you do not make a plan selection with Extend Health your coverage will terminate effective January 1, 2009. (That is a direct quote from the booklet.) If a retiree is away from home, visiting relatives or on a tour, someone should get the message to them.

There is an exception for retirees in Kaiser. They can stay in the Kaiser group plan until sometime in mid-2009 when Extend Health is anticipated to have made an arrangement with Kaiser to be able to broker individual Medicare plans provided by Kaiser.

Other items from the packet – dental insurance stays under Hewitt. Retirees can participate in the Vision plan – VSP Access Plan. This is a discount program, not an insurance.

The information packet contains no information about the individual Medicare plans or their costs. Having to purchase an individual plan instead of being in a group plan, I strongly doubt that we will come out ahead.

The LLNS booklet says that we will receive a packet from Extend Health during the week of November 3.

The LLNS booklet tells us that Extend Health has a web site. They don’t say what the web site is, but we can look it up.

I found, first, that Extend Health is a recent startup. They raised $15 million in a second round of venture capital funding in August 2007. See Extend Health raises $15M for defined contribution health plans, or just go to venturebeat.com and search their site for “Extend Health”.

The Extend Health web site is www.extendhealth.com.

Take a look at their Business pages, where they tell their prospective business customers that they can control current health costs and reduce corporate health liabilities and reporting obligations.

Extend Health is a combination of an administrative management company and an insurance agency.

You can look at the individual plans they have on offer. I found a few early facts. Medicare plans cover individuals. You select a plan for you and your spouse separately. The premium depends on where you live and increases with your age. It will take me a long time to go through the plans to find one which is similar to the group coverage I have this year, so I can compare cost.