Transferring Risk To Medicare

Plan sponsors have all sorts of risk transfer strategies from which to choose from. Stop loss insurance is an obvious risk transfer strategy. Then there is ACA mandated HFAP risk transfer and specialty drug risk transfer. How about transferring risk to Medicare? It’s the older folks who have more medical expense needs often driving up costs for a group plan.

Medicare eligible group members may decline employer sponsored health insurance in favor of Medicare benefits. Members who do that may want to purchase a Medicare supplement.

Medicare Supplement coverage can’t be paid directly by an employer. However, members can get a refund on their monthly premiums from their employer. But the employer must have a Section 105 plan in place. They can’t write a check for a member’s supplemental coverage itself, but they CAN refund members for their monthly premiums, as long as they arrange a Section 105 plan.

How Medicare Premium Reimbursement Works with an Employer Section 105 Plan

A Medicare premium reimbursement is a fantastic way for active employees to get refunds of their premiums. Often, premiums may cost less than group insurance. What is a Section 105 Plan?

A Section 105 plan is a reimbursement health plan that lets companies repay employees for their medical costs on a tax-exempt basis. Although there are several different plan options, the most popular Section 105 program is a Health Reimbursement Arrangement plan.

Medicare Premiums Reimbursement Through Employer – Section 105 Plan (