The Potential Peril of a Pure Medicare Exchange

We received an interesting phone call the other day from a benefits broker. His client made a move from an employer-sponsored group retiree medical program to a Medicare Exchange a little over a year ago. After a frustrating enrollment period followed by consistently poor service and the increasing administrative headache from angry retirees, the client was ready to make a move to a different Medicare Exchange.

Given our company has more than 25 years of retiree benefits experience, and a history of handling complex accounts, we were happy to assist. While there are attractive features in the Medicare Exchange strategy, employers involved in retiree benefits should consider the challenges before setting forward on a change. These challenges include:

Loss of control

Plan changes in benefits and pricing, access to data (for self-funded companies) and control over carrier servicing is lost. Unfavorable changes may not be in the employer’s hands, but they will not be exempt from dealing with dissatisfied retirees who have nowhere else to turn.

Loss of flexibility

Try as you may, there will always be the need for special circumstances. Whether it’s a retiree who gave decades of service, or a former C-Suite executive, proper resolution is essential to maintain employee goodwill and ensure each retiree can secure proper health insurance. Left on their own in the Medicare Exchange, retirees will be ill-prepared to resolve those one-off needs, including late enrollments, misunderstandings of coverage, communication errors and a default option for non-responders.

Limited alternatives

There’s a reason “leading edge” early adopters are often referred to as being on the “bleeding edge.” Reverting to a group plan (or moving to another Medicare Exchange) is challenging. While AmWINS’ Retiree Benefit Choice™ (RBC) program can help clients facing such a challenge, many employers are unaware of their alternatives when faced with the need to make a program adjustment.

Retiree “noise”

Health insurance is one of the most important decisions for a retiree. Employers must consider what will happen when a transition does not go smoothly, or care becomes inaccessible or unaffordable. Ultimately, retirees will voice their experiences to the organization, burdening employees who are trying to manage other priorities, and diminishing workplace productivity.

For those who are considering a Medicare Exchange, we recommend you explore the various “what-if” situations that can arise, noted above. We also suggest you consider RBC as a transitional program. RBC is offered only through AmWINS and is a hybrid program, giving retirees the option to retain their current (comprehensive) level of coverage, or enroll in an individual Medicare plan. This dual option approach is the only way retirees can truly elect the very best option to meet both their healthcare and their financial needs. This hybrid model can also provide a smooth transition over time to a Medicare Exchange model, if desired.