Alternatives to Traditional Medicare: Medicare Part C Poised to Prosper
by Mike Morfe
Recent events indicate that Medicare Part C (Medicare Advantage) plans are poised to prosper. Yet many employers express hesitation to offer Part C, formerly known as Medicare + Choice, plans to their retirees because they are concerned about the potential withdrawal of those plans if there is a reversal of federal funding rules. This article addresses those concerns. It provides a historical overview of Medicare Part C and describes the impact of the most recent agency guidance. The author cites plan trends, raises employer implications and concludes that Medicare Advantage plans will continue to expand, possibly facilitated by employers as they implement leading-edge retiree medical designs.
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What Comes After the Retiree Drug Subsidy?
by Dale H.Yamamoto
Under the Medicare Prescription Drug, Improvement, and Modernization Act (MMA) of 2003 and agency guidance that has followed, an employer now faces many options, such as contracting with a supplemental prescription drug plan, offering its own prescription drug plan or eliminating its retiree drug subsidy. This article discusses the complex financial, administrative and communication issues an employer must ponder. For instance, short-term cash savings must be weighed against longer term accounting implications; yet the best financial alternative may come with other baggage that offsets the dollar savings. The author uses data to show what employers have done to date and raises unresolved issues employers must address as Medicare Part D evolves.
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Beyond the Subsidy: Medicare Part D Employer Options
by Cara M. Jareb and Randall K. Abbott
The Medicare Modernization Act, now more than a year old, is opening up an array of possibilities for employers in dealing with retiree medical benefits. Many employers are beginning to look beyond the question of accepting Medicare's prescription drug subsidy and are more broadly considering how to shape their retiree health plans. This article describes the options available to employers now that Medicare Part D is in place. Through this analysis, the authors also explain how the choices employers make could affect retiree medical benefits and workforce planning issues.
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Evolving With Medicare: An Approach to Retirement Strategy
by Charles Habliston and Mark Hanrahan
With Medicare Part D now providing prescription drug coverage, employers' retiree health plans are ripe for change. Effective change requires more than just adjustments. A global or enterprisewide approach to the development of a retirement strategy is important and should encompass five components: design, finance, administration, communication and control. This article discusses the strategic approach to crafting retiree health policy as the Medicare landscape continues to evolve.
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401(k) Plan Participant Asset Allocation in 2004
by Sarah A. Holden and Jack L.VanDerhei, CEBS
How are American workers investing their 401(k) plan assets? This article provides a snapshot of year-end 2004 asset allocation based on a representative database containing information on about one-third of all 401(k) participants. Among the chief findings are 401(k) plan participants are heavily invested in equity securities; participants have a wide range of individual asset allocations; and recently hired participants in 2004 are more likely than their counterparts in 1998 to invest in balanced funds and less likely to invest in their employer's stock.
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Don't Be Caught Unaware— Severance and Change-In-Control Policies Need to be Reviewed Now More Than Ever
by Robert B. Jones, CEBS
A number of trends in executive severance and change-in-control packages mean that, now more than ever, compensation committees need to thoroughly review company policies regarding those matters on a periodic basis. Citing surveys and providing a detailed review of the relevant business and regulatory environment, the author of this article addresses how modifications to executive severance and change-in-control policies affect employee benefits, including retirement and health care plans.
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