It is estimated that over the next two decades, 78 million baby boomers will turn 65, which is the traditional retirement age.
But with the current state of the economy, many boomers are finding themselves working past the typical retirement age, causing both health insurance companies and employers offering medical benefits to find alternative ways to cover these individuals that fit with the bottom line.
“With the economy in its current state, baby boomers are working longer to keep their health benefits,” says Jim Loveless, vice president of individual product lines for SummaCare, Inc. “Not having adequate health insurance can create a huge financial burden for an individual in the case of an illness or emergency, and many people simply do not want to take that chance.”
Smart Business spoke to Loveless about how employers can offer affordable benefits to those workers age 65 and older, as well as what options are available to retirees without access to health insurance.
What kind of coverage is available to employers with employees age 65 and older?
As baby boomers work past retirement age, small employers are looking for ways to address the high premiums resulting from having active workers over the age of 65. Recognizing this, some health insurance carriers have developed products to meet the needs of these small employers (typically between two and 19 employees).
These products allow the employers with working Medicare-eligible employees to enroll in a customized group Medicare Advantage plan while keeping their employees under the age of 65 enrolled in their standard plan offering. The employer is able to offer the Medicare-eligible employee comprehensive benefits while realizing the cost savings of not having them in the same risk pool as their under-65 employees.
Larger employer groups find themselves in a different situation when offering medical benefits to an aging work force. All employees, regardless of age, are included in the same risk pool, so many employers will ‘buy-down’ benefits or select a plan with higher out-of-pocket costs in order to maintain coverage for all employees.
What kind of benefits will appeal to baby boomers?
Since baby boomers grew up during a time of great change, they are accustomed to new ideas, new processes and new solutions. They take a more active role in their health, becoming more engaged in their care and the services they receive. And since the baby boomer generation’s expectations are higher, they want to know the things they can do to take better care of their bodies and minds. Knowing this, employers with an aging work force should look for plan options with a focus on health and wellness services. Offer plans that cover things like flu shots, health maintenance visits, screenings and other preventive services.
Baby boomers are also more Internet savvy than the generations before them, so employers should look for a health insurance company that offers online tools, such as the ability to request a change of address and member materials, search for providers, submit benefit questions and inquire about claims, benefits and authorizations.
Other items of interest to baby boomers include having access to a health insurance plan that offers quality prescription drug coverage, pharmacy information online and mail order prescription opportunities.
What kind of coverage is available to working baby boomers without access to group health coverage?
Baby boomers without access to group health coverage have a couple options when it comes to staying insured. Individual health insurance plans are affordable products that allow individuals to choose a plan that’s right for their needs and budget. Many individual plans include prescription drug coverage, and some can be paired with a Health Savings Account, providing attractive savings through a qualified high-deductible option and creating tax planning opportunities.
Besides original Medicare, baby boomers age 65 and older without access to group health coverage have the option of enrolling in a Medicare Advantage plan offered through a health insurance company. Medicare Advantage plans typically cover more services and have lower out-of-pocket costs than original Medicare, and many feature multiple plan designs to pick from and prescription drug coverage.
If you have workers who are eligible for Medicare or want to learn more about retiree benefit options, call your health insurance company or contact a broker or consultant. They can help determine what option(s) may suit your company best.
Jim Loveless is the vice president of individual product lines at SummaCare, Inc. Reach him at [email protected]. SummaCare, Inc., a provider-owned health plan located in Akron, Ohio, services members in an 18 county service area through a network of over 7,000 providers and many top hospitals.
