State Farm retirees face uncertain change in health coverage

2011-11-22T17:41:00Z 2013-02-15T18:36:15Z State Farm retirees face uncertain change in health coverageBy Karen Hansen |
November 22, 2011 5:41 pm  • 

BLOOMINGTON — Ongoing, unresolved technical problems have led State Farm Insurance Cos. to suspend temporarily its current program to help retirees find new medical coverage — leaving them uncertain of how and when any changes will occur.

Medicare-eligible retirees originally were scheduled to be removed from the State Farm plan Jan. 1 in a cost-cutting move. But in an apology letter to its 24,000 retirees dated Monday, State Farm acknowledged the magnitude of problems with a vendor that was supposed to help those affected find alternative coverage. As a result, State Farm will provide health insurance “until the enrollment process is complete,” even if that extends into 2012.

“We’ve heard from several of you that you feel abandoned and that the company no longer cares about you,” said the letter from Mary Schmidt, a vice president in human resources. “Please know this is not the case, and we are committing extraordinary resources to resolving all issues relating to the enrollment process.”

Problems began last month, when Aon Hewitt Navigators, the company hired by State Farm to help retirees find new coverage, instead overbooked appointments for about 20 percent of its retirees. The appointments were scheduled in conjunction with State Farm’s 2012 open enrollment and were supposed to offer guidance on health-care options.

But the glitches that were supposed to be fixed still remained a problem weeks later, leading the company to direct Aon Hewitt Navigators to suspend all appointments, effective today.

“They’re working hard to get the whole process fixed,” spokesman Jeff McCollum said Tuesday.

McCollum did not know if Aon Hewitt Navigators would be terminated; Aon Hewitt declined to comment.

Retirees who were able to enroll do not need to make any changes at this time, State Farm said.

State Farm announced earlier this year it would remove the retirees, including 2,000 in the Twin Cities, from its PPO plan beginning next year. Instead, the company will provide $200 per person per month toward Medicare supplemental coverage.

The insurer said its health care costs were outpacing those of rivals, hindering its ability to remain competitive.


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(1) Comments

  1. exrepub
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    exrepub - February 16, 2013 5:14 am
    This seems odd to me. Most of the cost I would think would be paid from medicare and only a percentage would be from State Farm. So why remove them from supplemental coverage which I suppose people could get from AARp or something like that if they wished or not. Or why not just charge them a higher premium. Is this designed to get everyone in an uproar over not much? Isn't 80% or so covered from medicare A and B everyone believe it or not does not get sick. I would like to see or hear about some actual figures. Facts matter. It is the conjuring up of fears and troubles that get people going.
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