It's getting harder and harder to find a company that'll give you health insurance once you're retired. Both IBM and Time Warner have just announced they're going to end health coverage for retirees under their plans. Instead, they will give retirees an annual check to shop for their own insurance on a private health-insurance exchange.
The key word there is "private." This is not Obamacare. These are private health insurance exchanges for retirees -- kind of like giant insurance brokers.
If you're a retiree from one of these companies, says Paul Fronstin with the Employment Benefit Research Institute, there are upsides. You'll have a bigger choice of plans. You can pick the plan that's right for you. Of course, just how much choice you'll have depends on how generous your company's contribution is.
IBM and Time Warner aren't the first to dump in-house health care, in favor of private exchanges. Fronstin says, "I would expect more employers doing this with retiree health benefits."
"Many firms are looking for ways to disentangle themselves from retiree health benefits and costs," says Tricia Neuman, with the Kaiser Family Foundation.
Most large companies don't offer any retiree coverage. Twenty years ago, about two-thirds did.
Moving retiree health insurance to private exchanges, is also one less thing for a company to worry about. "It could be that they are just trying to distance themselves from managing their health benefits," says Neuman.
After all, that's not the business they're in.
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