Employer Group Waiver Plan (EGWP)

A type of employer group plan where membership is restricted solely to employer or union sponsored group plan members.  Ex.,  Municipalities, School Districts, Unions.
Insurance companies contract with the Centers For Medicare and Medicaid Services (CMS) to offer this benefit to the retirees' employer or union sponsor on CMS' s behalf.  The sponsored and certified insurance company receives direct subsidies, low income subsidies, and reinsurance payments for the employer or union's approved beneficiaries and passes the savings on to the employer or union and their members.
EGWP savings range between 19% and 21% plus, vs RDS premiums.
All we will request is to prepare a free no obligation quote for your comparison. 

Email

770-662-8510 Local
800-533-5969 Toll free
770-662-0516 Fax

Tonia@diversifiedsenioradvisors.com
 
 Click Here For A More Complete Overview Of RDS vs. EGWP 

Retired Drug Subsidy (RDS)

28% of allowable drug costs between $295 and $6000 (for 2009), tax-free.
No catastrophic coverage.
No tax advantage for public sector and non-profits.
Estimated about 15%-20% of total drug spending. (average about $500 per retiree).
High administrative burden.
State and local government - New GASB disclosure requirements allow retiree healthcare liability to be reduced by only one year's worth of RDS payment.
Required to book future cost for retiree benefits under GASB 45 and FASB 106.
Must pass two actuarial equivalence tests. 

Employer Group Waiver Plan (EGWP)

Employer is only responsible for retiree premium component - estimated savings up to 19% - 21% plus.
Catastrophic coverage built in to Part D plan.
More attractive for tax-exempts (non-profits and public sector).
No cash flow issues for employer - savings realized on a monthly basis.
All administrative functions handled by CMS approved sponsoring company.
Provides a greater reduction in GASB 43/45 liability and FASB 106.
Reduced personal exposure.
Multiple advantageous waivers.