Emeriti's Comprehensive Option
The Emeriti Defined Contribution Model - a Sustainable Solution
Unlike the traditional defined benefit paradigm for retiree medical benefits, Emeriti uses an alternate funding vehicle: the defined contribution model commonly associated with 403(b) pension plans.
During active service, Emeriti's comprehensive approach maximizes budgetary predictability and cost control for the institution by:
- Making employer contributions in the current budget
- Offering faculty and staff opportunities to contribute their own savings
- Allowing faculty and staff to direct the long-term investment of all contributions
At retirement, the accumulated assets held within VEBA (Voluntary Employees’ Beneficiary Association) Trust health accounts are made available on a fully tax-free basis to participants for:
- Emeriti's broad range of guaranteed issue group health insurance plans
- Reimbursement for other qualified out-of-pocket health care expenses,
not covered by the insurance plans
Learn more about the key features of the Emeriti Program.
If you have a retiree health plan for your employees, you may be finding the annual costs increasingly unaffordable today and the mounting accounting liabilities unsustainable into the future. Aging workforces, their rising health care utilization, and their longer life spans will inevitably affect long-term benefit expenses. Even access-only health plans have growing costs, especially when linked to the active insurance pool, due to the greater health care expenses of older individuals. Many institutions are reducing employer contributions to and/or coverage provisions for their retiree health insurance, just as the strategic value of this benefit has become more central to the retirement decision of older faculty and staff.
If you do not have a retiree health plan, you may feel that you cannot add a new benefit in this environment; and yet, end-of-career salaries, health insurance, and other types of compensation for even a small number of your highest earning older employees may cost more than the annual outlay for participation in Emeriti’s defined contribution retiree health plan.
Whether you have a retiree health benefit or not, Emeriti can customize a plan to meet your institution's cultural and financial needs.
To receive a customized analysis of insurance cost savings and pre-funding amounts,
call 1-866-685-6565, or email us at info@emeritihealth.org.
