Before the reform of health care, many companies were down or reducing retiree health insurance because of the cost. Reform attempted to reverse this trend by offering grants to cover and work as a temporary measure until the health insurance exchanges are established in 2014.
The grants can be used to reduce the cost of benefits and bonuses, output of-pocket costs, deductibles and coinsurance.
Initially the plan set aside $ 5 billion to cover the cost of coverage for retirees. In 2010, $ 535 million was paid to 253 different organizations. Approximately $ 3.6 billion is set aside for grants in 2011, $ 1.4 billion for 2012 and $ 24 million in 2013. But some experts believe that the money for grants could miss this year.
Bloomberg reports that up to 5,000 candidates registered for grants and waiting to find out if they are approved. Only 253 organizations received grants in 2010, with 56 percent representing state and local governments.
For example, the pension plan for California officials received $ 57.8 million in 2010. The pension office New Jersey received $ 38.6 million. And grant funds are not given to governments will go to companies that are not in need.
It will be interesting to see what percentage of businesses and governments receive funds in the next year and how long the funds last. If funds are given to governments and unions, it seems as if the provision was written for cash-strapped states can receive and opposition critics.
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