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Thursday, May 13, 2010

Early retirees find a safety net

Erin Kelly

Staff Writer

It’s no secret that our economy has left businesses around the country in a tight financial bind. In an effort to save money, many employers have decided to drop health insurance coverage—leaving many hard-working Americans in a vulnerable position. One group of people that is especially vulnerable is early retirees.

Many Americans who retire before they are eligible for Medicare are seeing their coverage taken away by former employers—leaving them in fear of losing their life savings due to medical costs. According the White House,

The percentage of large firms providing workers with retiree coverage has dropped from 66 percent in 1988 to 31 percent in 2008.

 When a person loses group coverage, they’re left to find insurance in the individual market, where premiums can be extremely expensive, or they can be flat out denied coverage. And as we’ve previously noted, 45.4% of adults aged 55-64 are at risk of being denied coverage in the individual market due to a pre-existing condition.

Beginning June 1, the Patient Protection and Affordable Care Act will provide $5 billion in financial assistance to help employers purchase coverage for early retirees aged 55 and over. This program will make it easier for employers to provide coverage for retirees, and it will provide peace of mind to the older Americans who may not be able to find affordable coverage in the individual market.

For older Americans, this is great news. After a lifetime of hard work, retired Americans deserve the safety and security that health insurance provides. And thanks to health reform, many of them will finally have coverage they can count on.