IT and Technology giant, IBM has announced that the company is making to optimize benefits for both current and former employees.
The updates are intended to streamline offerings and plan administration while providing enhanced options for as many active and retired IBMers as possible.
Medical Benefits and 401(k) Enhancements for Active IBMers in the U.S.
IBM is making a significant investment in its medical benefit offerings and will improve and simplify its U.S. medical plan. In 2023, IBM will offer three new medical plan options with enhancements and simplified plan provisions.
The majority of IBMers will see no change or a reduction to the amount paid monthly for healthcare premiums.
In addition to robust 401(k) and financial planning services the company offers, IBM will also shift to providing 401(k) contributions (match and automatic contributions) per pay period (instead of annually), allowing IBMers to invest both their contributions and IBM match and automatic contributions throughout the year.
IBM Retiree Medical Plan for Medicare Eligible Participants Transition
Reinforcing IBM’s commitment to retiree healthcare and wellbeing, coverage under the IBM retiree medical plan for Medicare-eligible participants will transition to a new IBM-sponsored Group Medicare Advantage program administered by UnitedHealthcare, starting on January 1, 2023.
The new program will offer a simpler and better overall approach with two new plan options designed specifically for IBM, including a zero-premium option. Participants do not need to worry about networks and will have access to any Medicare provider that accepts the plan as well as broad drug coverage.
More than 99.9% of UnitedHealthcare Group Medicare Advantage members continue to have access to their chosen providers. Participants will receive valuable benefits and features that are not currently offered through individual plans, as well as a new level of coordination and support for overall health.
IBM Personal Pension Plan Purchases Two Group Annuity Contracts
For some participants and beneficiaries in the IBM Personal Pension Plan who commenced benefits before January 1, 2016, IBM has transferred the obligation to pay benefits to Prudential and MetLife.
As of January 1, 2023, Prudential, as lead administrator, will begin making ongoing pension payments to the included participants and beneficiaries, and importantly, benefit amounts, benefit payment dates and banking arrangements are not changing.
The decision to purchase the group annuity contracts, where the insurance companies provide guaranteed payments to individuals covered under the contracts, came with careful review and consideration.
Prudential and MetLife were selected by an independent fiduciary retained by the Plan. Under federal law, the independent fiduciary must act solely in the interest of plan participants and beneficiaries.
Prudential and MetLife are well-established, highly rated organizations with a strong track record of successfully delivering and protecting pension benefits.