Group Retiree Medical Benefits Consulting

Navigating retiree medical benefits can be daunting, especially when you’re doing it on your own. At Lewis & Ellis, we simplify this process by providing comprehensive actuarial consulting services specifically tailored for retiree medical benefits.

Our actuaries uses its deep industry knowledge to guide you in managing your retiree medical programs effectively and strategically.

What Is Group Retiree Health Coverage?

Group retiree health coverage is employer- or union-sponsored health insurance provided to retired employees and their spouses. Companies can provide continued health benefits after team members are no longer working, often supplementing or pairing with Medicare to help individuals manage costs.

Consulting for this area of health insurance gives employers a better understanding of what those medical obligations are likely to cost over time. Groups that benefit from group retiree consulting include:

• State and local governments.
• County agencies.
• School districts.
• Transit authorities.
• Universities.
• Hospitals.
• Private-sector employers.

The Benefits of Group Retiree Consulting Services

Group retiree consulting is a specialized intersection of actuarial science, Medicare regulations, and long-term financial planning that most general benefits consulting firms simply don’t address. Unlike active employee benefit consulting, which typically focuses on annual renewal cycles and current cost management, retiree medical consulting requires projecting costs and liabilities decades into the future.

Partnering with Lewis & Ellis provides your organization with:

• Tailored actuarial insights aligned to each organization’s retiree plan design, workforce demographics, and long-term financial goals.
• Accurate projections on long-term retiree medical liabilities using advanced actuarial modeling and healthcare trend analysis.
• Compliance support for GASB 74/75 and FASB ASC 715 reporting requirements, helping organizations avoid audit issues and financial statement risks.
• Strategic guidance for managing OPEB liabilities and improving long-term financial sustainability.
• Deep Medicare expertise informed by more than 15 years of Medicare Advantage and Part D bid review experience for CMS.

How We Serve Our Clients

Comprehensive Evaluation of Retirees’ Medical Liabilities

Understanding your financial obligations is the first step in managing retiree medical benefits effectively. Our skilled team of actuaries draws on their expert knowledge of FASB and GASB rules to accurately assess your retiree medical liabilities. This thorough evaluation provides a clear financial picture, allowing you to make informed decisions for the benefit of your retirees.

Strategic Retiree Plan Design and Funding for Medical Benefits

Having a strategic plan in place is crucial for the successful management of retiree medical benefits. Our team at Lewis & Ellis assists you in designing a comprehensive plan that meets your financial goals and aligns with your retirees' needs. In addition, we provide tailored funding strategies to ensure your retiree medical benefits program is financially sustainable for the long term.

In-Depth Cost Projections for Retiree Medical Plans

Accurate cost projections are essential for planning and budgeting purposes. At Lewis & Ellis, our actuaries draw on their extensive experience to provide you with in-depth cost projections for your retiree medical plans. Our detailed analysis enables you to forecast future costs accurately, helping you plan effectively for the financial sustainability of your retiree medical program.

Retiree Medical Benefits Compliance Under FASB and GASB Rules

Our team is proficient in FASB and GASB rules, providing you with the guidance you need to ensure your retiree medical program is fully compliant. We help you understand and meet your regulatory obligations so you can focus on providing the best possible retiree medical benefits.

Get Help With Group Retiree Planning

Lewis & Ellis has served insurance companies and organizations with group retiree benefits consulting since 1968, providing key insights and resources to ensure you find the right programs and coverage to protect your team and assets.

With a compliance-focused approach and strategic, actionable insights, our team provides clients an actuarially sound picture of their long-term liabilities, what those plan benefits will cost over decades, and how to make the most informed decisions about plan design, funding, and Medicare integration. We’ve helped clients across the country, from the Los Angeles Department of Water & Power to transit authorities in Florida and Washington, understand their obligations and find ways to make them more sustainable.

Ready to better understand and manage your retiree medical obligations? Connect with us today.

Group Retiree FAQs

What qualifies as a group retiree health plan?

A group retiree health plan is any employer- or union-sponsored coverage offered specifically to former employees, their spouses, and dependents. Eligible retirees using these Medicare supplement policies must meet the specific criteria set by the former employer, such as reaching the retirement age of 65 or meeting the minimum number of years of service.

Additionally, retiree coverage plans are used in conjunction with Medicare, and they often provide benefits similar to active employee plans.

How do group retiree Medicare Advantage and supplemental plans differ?

These two coverage options represent fundamentally different architectures for delivering medical coverage alongside Medicare. Group Medicare Advantage plans, including Employer Group Waiver Plans (EGWPs), replace Original Medicare entirely for enrolled retirees. The employer contracts with a Medicare Advantage carrier, and the plan delivers all Part A and Part B benefits through a managed care structure. EGWPs, in particular, allow employers to access federal Medicare funding in a way that can substantially reduce net plan cost, often with richer benefits than the employer could otherwise afford.

Supplemental plans, by contrast, layer on top of Original Medicare. They fill gaps that Medicare leaves, like deductibles, coinsurance, and copays, without displacing the underlying Medicare coverage. Traditional Medigap and group supplemental medical plans fall here.

Why should employers offer group retiree coverage instead of stipends or individual plans?

Group retiree plans typically allow employers to negotiate more favorable rates than retirees could get on their own in the individual market, providing past employees with better coverage while giving organizations better purchasing power and cost stability.

In contrast, stipends and reimbursement models expose retirees to changing individual-market premiums and out-of-pocket costs that may fluctuate year to year.

How does actuarial analysis reduce long-term retiree medical liabilities?

You can’t manage what you haven’t measured. That’s why actuarial analysis is the essential first step to reducing costs over time. Our team’s OPEB valuations project post-employment benefit costs for both current retirees and current active employees who may retire in the future, incorporating age-dependent claim costs, healthcare trend rates, survival probabilities using Society of Actuaries mortality tables, and Medicare carve-outs for people above 65.

For fully insured plans, we analyze the underlying cost for retiree coverage by looking at age-dependent claim costs, capturing the implicit rate subsidy, which is often the hidden cost of blending the retiree and active employee population into a single premium. Once we measure the liability, we help clients reduce it through targeted strategies:

• Plan design changes.
• Adjusting retiree contribution structures.
• Pre-funding trusts.
• Transitioning to group Medicare Advantage plan arrangements.

Which FASB/GASB rules govern retiree medical reporting?

Retiree medical benefits are generally treated as other post-employment benefits, or OPEB, for financial reporting purposes. The applicable accounting framework depends on the type of organization.

For public-sector employers and OPEB plans, the primary standards are GASB Statement No. 75, which governs employer accounting and financial reporting for OPEB, and GASB Statement No. 74, which applies to financial reporting by OPEB plans. Older standards, including GASB 45 and GASB 57, may still be referenced in historical discussions, but GASB 74 and GASB 75 are the current core standards for most governmental OPEB reporting.

For private-sector employers, retiree medical and other postretirement benefit obligations are generally addressed under FASB ASC 715-60, which covers accounting and reporting for defined benefit postretirement plans other than pensions.

Lewis & Ellis helps organizations evaluate retiree medical liabilities, prepare actuarial valuations, and support financial reporting under the applicable GASB or FASB framework.