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31-Oct-2011

Analysis of LM Medical and Dental Plan Proposals for 2012
"Nothing But Good News!"

Dear COMARA People:

I have fully reviewed Lockheed Martin's proposed Medicare Plus Catastrophic Plan 076 and Delta Comprehensive PPO Dental Plan 435 for the calendar year 2012 coverage (I believe that the majority of COMARA members age 65 and up have elected this plan), and can make the most remarkable conclusion:

THERE IS NO CHANGE, IN ANYTHING!

(Well, we're actually going to save less than a buck in the monthly coverage too, if you want to call that a change.)

There is no change in coverages, deductibles, co-pays, prescription drug costs - no changes in anything.

Of course, I have not reviewed the other four plans that Lockheed put forth. If you are enrolled in one of them, you will have to do the same homework, getting out the coverage sheets for both years and going through them line by line.

I thought this was all wonderful but "passing strange," given all the articles in the recent press about corporate medical costs increasing rapidly. But then Saturday's mail brought a possible explanation. Lockheed Martin's retiree health plans have been "certified for participation in the Early Retiree Reinsurance Program (ERPP)," which was authorized in the Affordable Care Act, and LM has elected to use this program to reduce premium increases that we would otherwise sustain.. The idea behind this "subsidy," as I understand it, is to incentivize corporations NOT to cancel retiree health plans they have in place. So perhaps the ERPP "ate up" whatever changes in coverages, premiums, deductibles, etc. we might otherwise have been confronted with.

The tricky thing is that according to the supplemental note from the federal Dept. of Health and Human Services, included in LM's mailing to us, this ERPP program is scheduled to expire on Jan. 1, 2014. So perhaps this is only a two-year benefit. What happens then is anybody's guess.

But for now, phew, we appear to have survived another annual benefits enrollment with good programs at essentially the same prices. I'm pretty happy about that, and hope you will be as well.

Best regards to all.

Jack Hannon

Please note that this is an informal review of the Enrollment documents and is not intended to offer Legal or Financial advice. Doing your own review, and coordinating with your own advisers, remains YOUR responsibility.