Louisville, Ky. (March 2, 2006) – SHPS, a leading Integrated Health Management provider, announced today the expansion of its Consumer-Directed Retiree Health Plan (CDRHP™) solution to public sector employers, who continue to battle with concerns over the Government Account Standards Board (GASB) requirement under Rule 45 that requires them to account for unfunded financial liabilities for items such as retiree healthcare.

“When it comes to the retiree healthcare crisis, public sector employers are facing many of the same challenges that private companies are encountering with the added complexity of the new GASB 45 requirements,” said Rishabh Mehrotra, SHPS’ president. “SHPS realized that its CDRHP product, which has been well-received by many large, private employers, was a very good solution for public sector employers as well.”

CDRHPs offer employers the ability to maintain retiree healthcare benefits through consumer-based programs. Just as countless companies moved from offering traditional pensions to 401(k)s, CDRHPs transition retiree healthcare from a defined-benefit to a defined-contribution approach. Plus, CDRHPs have the added benefit of using tax-favored funds to purchase government-subsidized insurance offered through Medicare Advantage and Medicare Part D plans.

For public-sector employers, CDRHPs can be deployed using a variety of options, including a voluntary employee beneficiary association (VEBA)-funded health reimbursement arrangement (HRA). Employers may also establish a notional account-based retiree health plan.

By utilizing the wealth of consumer support tools available through SHPS’ Integrated Health Management solutions in conjunction with a CDRHP, employers can significantly reduce their healthcare liabilities.

“The new GASB 45 requirements illustrate the full financial impact retiree healthcare benefits have on the financial stability of public sector employers,” said Bruce Gillis, retiree administration product manager. “Once employers account for the cost of the lifelong benefits they’ve promised to employees, the retiree healthcare crisis becomes extremely evident. CDRHPs allow employers to manage their healthcare expenses while continuing to support their employees beyond their years of employment.”

CDRHPs are available for both public and private sector employers immediately.

About SHPS
SHPS provides a broad range of innovative health management tools, resources and services that empower consumers to make wise healthcare decisions. With comprehensive services that transform consumer health behaviors, SHPS’ integrated delivery system maximizes the value of consumers’ and employers’ healthcare dollars. Among its many clients, SHPS serves large and mid-sized employers, health insurance carriers, third party administrators, Medicare Part D providers and government agencies. The company employs registered nurses and health professionals, employee benefit specialists and IT experts in facilities across the United States. Visit www.shps.com.

For More Information
Sarah Bovine
Director, Corporate Communications
sarah.bovine@shps.com

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