STATE CAPITOL NEWSLETTER: Early retiree plan signup
More than 50 Wisconsin employers have signed up for the federal Early Retirement Reinsurance Program to help continue health coverage for those retiring between ages 55 and 64.
The program will reimburse 80 percent of annual health care costs for each eligible retiree and eligible spouse, surviving spouse or dependent. The $5 billion temporary plan has attracted major businesses, union groups and government employers in the state.
Among major private employers enrolling include Briggs and Stratton, Master Lock, Wausau Paper, Wisconsin Electric Power, Appleton Papers, Johnson Controls, Rexnord, Rockwell Automation, Northwestern Mutual Insurance and Manpower.
Building-trade unions have joined the new program. And early government participants for their retirees include Milwaukee and Antigo schools; counties of Milwaukee, Washington and Racine; and the cities of Waukesha, West Allis and Wisconsin Rapids.
Gov. Jim Doyle has hailed the quick action by Wisconsin employers. The money is allocated on a firstcome, first-served basis until the funds run out. He noted the program is part of the national health care program.
Maybe Doyle is too optimistic. Republicans have spent the year denouncing the health care reform act and vowing to overturn it when they take control of the Congress. The U.S. House of Representatives Ways and Means Committee plays a central role in federal spending.
Newspaper reports informed the public that Milwaukee County Executive Scott Walker, one of those critics, had his county sign up for the federal funds. Republicans are demanding less federal spending. Doyle estimates the national health care reform law will bring more than $750 million to the state.
In an August campaign debate, Walker criticized the Wisconsin health care efforts as over ambitious. The BadgerCare program, which provides coverage to thousands of working poor, has become bloated and needs to be scaled back, he said. Ron Johnson, the Republican candidate for the U.S. Senate in Wisconsin, suggests the health-reform legislation is undermining America. The early retirement provisions will phase out in 2014 – when the new law takes full effect. But it could be much earlier if Republicans have their way.
Doyle’s office, long silent about the Republican attacks on the two-term governor, seems to respond to the GOP critics when he announced the initial signup for the early retirement program.
According to a statement from the governor’s office, “Wisconsin is now America’s health-care provider, ranking first for health care quality, second in access to coverage, and providing health care access to every child.”
But the economics for older citizens are different than those starting new families.
The soaring cost of health care is the central issue for families as early retirement is considered. Part of the dilemma reflects that those in the 55-64 bracket have higher health costs than those in their 20s and 30s.
Long-term employees in the 55-64 bracket often have higher salaries than younger workers. Companies can pare back payroll costs if they can replace early retirees with younger workers. A guarantee of some health coverage makes early retirement packages more attractive.
The early retirement money could give the employers a couple of years of help until Republicans fulfill their promise to repeal the health care reform law or block its funding.
