5 Reasons Why Employers Should Have a Corporate Medicare Plan

Medicare isn't just vital insurance coverage to address the healthcare needs of older Americans, it is an important and unique tool for employers in managing their overall healthcare costs. This management takes place via the development and implementation of a customized Corporate Medicare Plan. Here are five reasons why most employers should have such a plan:

1. A Rapidly Growing & Expensive Employee Segment - All US citizens who are aged 65+ are eligible for Medicare. According to the US Department of Labor, 7% of the labor force is 65+ in 2024 and that number is expected to reach 9.5% in 2030. The average annual healthcare expenditures in 2020 for those 65+ was $22,356 or about 2.5 times the expenditures for those under 65 - $9,154 (Source: The Centers for Medicare and Medicaid Services)
2. Shifting the Cost, Retaining the Employee - Unlike many healthcare cost containment programs which attempt to achieve a slight moderation of healthcare expenses per engaged person, Medicare presents a unique opportunity to shift virtually the entire cost of healthcare from the employer to the federal government while retaining the services of these valuable employees. The Corporate Medicare Plan should be part of an organization's attraction and retention strategy
3. But Employees Need Help - Medicare is different and can be overwhelming for those accustomed to a group health plan. Consider - 30% of those 62 to 64 believe they are not eligible for Medicare because they are still working (Source: Allsup Survey); the average person has 43 Medicare Advantage plan options to choose from (Source: The Kaiser Family Foundation) and; many do not realize that their spouse may be able to remain on the group plan if the employee chooses to move to Medicare. Employees are accustomed to the employer helping them with health benefit decisions and this is true for Medicare, as well
4. Can Be Better For Both - Employer-sponsored group plans are developed to serve the needs of all employees and their families. Medicare was built to serve those who are 65 and older. It provides many more coverage options that may better meet their individual needs and at a lower total cost. When an employer provides resources to this population that help them make the right decision, more will switch to Medicare - better for them, better for the employer. When employees find the the right plan for them, they tend to feel the employer is right for them, too
5. Stop Seeing Double - Most employees have been paying for two healthcare coverages for their entire career - their group health plan and Medicare through the Medicare payroll tax. When they turn 65 and their employer helps them get clear information about their new coverage options, they may decide to stop paying for one coverage and pay for one that is better for them at that stage of life

Employers have tried many things to stem the tide of these costs. Medicare offers a unique opportunity to do so to the benefit of both employees and employers. A Corporate Medicare Plan offers a way to make this opportunity come to life.