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About the Program
The Emeriti® Program emerges as the result of a three-year study sponsored by The Andrew W. Mellon Foundation on the changing dynamics of retiree health benefits in the academy. Responding to a rapidly aging population, changing retirement patterns and spiraling health insurance costs, Emeriti proposes a nationally available, supplemental medical insurance program supported by tax-advantaged health savings accounts.
Emeriti's innovative solution relies on three key, integrated elements:
- the collective buying power of higher education and allied not-for-profit institutions;
- a tax-advantaged, defined contribution approach to funding retiree medical benefits; and
- a competitive and comprehensive benefit package.
The Program is managed by Emeriti® Retirement Health Solutions and is delivered seamlessly by two nationally prominent organizations in the retirement services field.
Innovative Trust Structure Delivers Tax-Advantaged Savings
A key component of the Emeriti Program is the pre-funding mechanism – the Emeriti® Health Accounts, administered by Fidelity Investments. The investment vehicle uses a defined contribution approach that allows both the institution and the employee to invest for future benefits at various levels of coverage and cost. As opposed to the widely used defined benefit approach, the defined contribution method maximizes budgetary predictability and cost-control, while limiting future FAS 106 liabilities. The contributions reside in highly tax-efficient Voluntary Employees' Beneficiary Association trusts (VEBAs), and are invested in a strategically designed portfolio.
Custom Plan Design Provides Catastrophic Protection and National Access
By combining a consortial structure with a pre-funding mechanism, Emeriti is able to configure a comprehensive and highly competitive benefit offering, with enhanced pharmacy benefits and catastrophic coverage – key concerns for many prospective retirees. The Emeriti® Health Insurance Plan Options are underwritten by Aetna Life Insurance Company1, a nationally prominent health insurance carrier. These offerings complement Medicare, and their superior design exceeds the coverage of existing individual Medigap plans, while also controlling escalating healthcare costs. They are available nationally, enabling future retirees to access their benefits wherever they reside or wherever they may travel (subject to variation in certain states and territories).
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