Facing rapidly rising costs in retiree health care benefits, many plan sponsors that offer group-based medical and prescription drug coverage to Medicare-eligible participants are aggressively exploring their options.
They want to honor the commitments they’ve made to their retired workers, while better managing the large liability and uncertainty that comes with maintaining their status quo.
The choice then becomes two unique paths: adopt a group Medicare Advantage medical plan, or migrate retirees to the individual Medicare exchange market. Both offer the potential for savings, but that’s where the similarities end. For many plan sponsors, a private Medicare exchange is the better longer-term alternative, for a variety of reasons.