California Law Permits Adjustments To Retiree Health Benefits
A new California law goes into effect on January 1
, 2011, which would make it okay to alter, reduce or eliminate retirees health benefits once they become eligible for Medicare.
This isnt a big change to California law, notes Alan Weinstock, insurance broker at http://www.MedicareSupplementPlans.com. Its only meant to clarify that the state law conforms to the federal Age Discrimination in Employment Act when it comes to this issue.
California Fair Employment and Housing Act (FEHA)
The FEHA bans employment discrimination on the basis of age (40 and over), ancestry, color, religious creed, disability (mental and physical) including HIV and AIDS, marital status, medical condition (cancer and genetic characteristics), national origin, race, sex, and sexual orientation. The FEHA covers California employers with five or more employees. Only one employee is needed for a sexual harassment claim.
The FEHA also prohibits retaliation against someone for opposing any practice forbidden by the Act or for filing a complaint, testifying or assisting in proceedings under the FEHA.
This new law applies to health benefits or health care reimbursement plans offered to retired employees. It essentially adopts an exception to the federal Age Discrimination in Employment Act (ADEA) by permitting employers to offer health benefits to non-Medicare eligible retired participants that can then be adjusted when the participant becomes Medicare eligible. This narrow exception basically specifies that FEHA does not prohibit employers from providing health benefits to retired persons that are later altered, reduced or eliminated.
This exception is intended to encourage employers to continue offering retiree health benefits to participants who retire before becoming Medicare eligible as a bridge until they become Medicare eligible.
This law applies to all retiree health benefit plans and contractual provisions or practices concerning retiree health benefits and health care reimbursement plans in effect on or after January 1, 2011.
What Non-Medicare Eligible Retirees Need to Consider
Nowadays more and more people are working past the age of 65the age at which they become Medicare eligible. However, if you are considering retiring prior to being eligible for Medicare, there are some things youll want to consider.
One of the best places to start if you are considering retiring before the age of 65 is with your employers human resources department. If your company doesn't offer full retiree health benefits, you may need to price other group coverage or individual policies to supplement your benefits.
COBRA will cover retirees for up to 18 months before they turn 65. That means that if you retire before age 63 1/2, youll want to evaluate your health coverage needs, including doctor visits, prescriptions and potential long term care coverage. You may even want to consider purchasing an individual health care plan.
You may also consider working part-time as some employers offer benefits to employees who work a minimum number of hours each week.
Finally, the best thing to do is to know your options well before your 65th birthday. This includes not only knowing about Medicare Parts A through D, but also understanding how Medicare supplement insurance might be right for you.
For more information about Medicare Part A through Part D, check out the U.S. Department of Health and Human Services. For additional information on Medicare supplement insurance, also known as Medigap, visit http://www.MedicareSupplementPlans.com.
by: SophieBen
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