Health coverage for retirees

Tomkitten- Where is it written that an organization is obliged to subsidize health insurance for people who no longer work for them? For awhile, there were companies that did just that, but that was a perk, not a right.

There are a number of options for people on Medicare. (I am one of those folks who is on Medicare). A person can just have the Medicare, and pay the deductable and 20% copay. If he desires, he can get a Medigap plan, which will take care of the copay and deductibles. He can add a Part D policy, which is not wonderful, but will pay for a portion of drug costs.

If a person does not have the financial means, he can opt for a Medicare HMO. In many cases, besides the Part A which is taken out of social security by the government, there is often no additional out-of pocket premium costs. There are considerable co-pays though. The downside is that the person is often limited to the doctors and hospitals that are contracted to the particular HMO's network.

A firm is in the business of making money. They are not charitable institutions. The cost of medical care, especially for the elderly, has made it near impossible for many companies to be magnanimous in covering employees who have retired.

The problem is that some people have been so conditioned to expect these medical perks, that they are appalled when a firm has to change their polices to coincide with business reality.

I think that the new retiree generation needs to make provision to the fact that for most of them, the cost of medical care will have to come primarily from the individual. The free ride is over.

Health coverage for retirees
Phoenix - I agree that dropping health care coverage for the very people who, generally speaking, need it most, and who have relied on it for decades isn't illegal, and I perfectly realize that morality and ethics are given short shrift by large companies; that is the less attractive side of capitalism.

I'm thinking more about those who, like myself, are already benefiting by Medicare supplemented by longstanding coverage from my husband's pension. People in this position have, presumably, budgeted accordingly. While it isn't written anywhere that companies MUST provide coverage, it seems to me that those which do have established something close to a continuing contract with their current beneficiaries.

Change the policy for those still working, warn them that once retired they are on their own, remove retirement health care coverage as an incentive or a perk, but don't back out of an agreement that is currently being honored.

I agree it is naive to think business' should be the source of our healthcare. The majority of companies will continue to cut back on the benefits in order to keep their bottom lines lush- and they have the right to do so. It's called private enterprise.

The USA is not a private enterprise, it is a country. It is a country made up of Americans and a country should not be run like a corporation where money is the only value. We the people should be responsible for our health care, but we cannot do it as individuals. As a country we need to invest in ourselves and create a program in which we all pay a fair share. We all pay to keep the roads and bridges functioning, we pay to keep the military armed, we pay to keep our people literate and we need to pay to keep Americans from dying of curable diseases or losing their homes in order to buy medications.

If we join together as a country, the rich will still have the advantage of going beyond basic care, but at least the majority of Americans will not be forced to beg on the steps of a church or have bake sales to raise money to cover medical expenses for their children. We are either going to end up as a united, healthy country or a country of happy, healthy rich people stepping over the bodies of the less fortunate. We can choose to make ourselves strong by joining together, or weak by trying to circle the wagons around our individual McMansions and bank accounts.

I think America's strength as a nation is going to be tested by our willingness to share and invest in other Americans - we will either model Western Europe and Canada or countries like India and China. The next decade is going to show which way we will go.

http://www.nytimes.com/2007/12/27/washington/27retire.html

Sounds perfectly reasonable to me. If someone goes into early retirement, he/she will have no reasonably priced health insurance. As someone who paid $10,000 a year for health insurance from age 60-64 I know that could be a problem for a lot of people. At 65, there are viable options.

TomKitten and I are in the same position.

With Mr. Noddy's current health benefits we are very comfortable in retirement. If these benefits are lost....

I can't quite understand the need for the ruling. It is my understanding that it is not nor has it been obligatory for a company to continue to offer medical medical insurance after retirement. Unless it is contractual.IE Union contract. Most of the larger companies at a price do however offer it. The price and I speak from experience at a cost slightly lower than can be purchased commercially.

The NYTimes article does a very poor job of explaining what this ruling by the EEOC actually does. So poor in fact, that based on the comments posted here it appears that people are under the impression that the ruling does exactly the opposite of it actually does.

Here is the issue: Let's say that "Bob" retires at age 55. As a part of his early retirement his company agrees to continue his health insurance. At age 55 that insurance costs the company $15,000/year.

On the same day that Bob retires "John" also retires at age 67. His retirement package also includes health insurance.

The company provides insurance that ends up with identical coverage for both Bob and John. But because John is eligible for Medicare his basic services are provided there and the company's cost for his "additional" insurance is less - $7,000/year.

So Bob's "benefit" package costs the company $15,000/year and John's costs the company $7,000/year.

Where is the problem?

The problem comes in the name of a lawsuit (Speciifically Erie County Retirees Association v. County of Erie). In that lawsuit John sues his former employer for age discrimination because he is being paid less in benefits.

And he wins! And in winning the court rules that paying different amounts for retiree's heatlh insurance violates the Age Discrimination in Employment Act.

So, because of the ruling his former company (and every other company that now fears a lawsuit) would be forced to pay for a more expensive insurance policy for John and all of his fellow Medicare eligible reitirees even though that more expensive policy replicates the benefits they get through Medicare.

What this EEOC ruling does is resets the rules for businesses to what they were prior to the court decision. (The court ruling hasn't really ever been inmplemented pending the final rule making by the EEOC anyway).

Anyone that is retired and has some sort of company provided insurance isn't going to have it stripped away from them on the basis of this rule. This rule prevents the court's decision from going into effect.

http://www.eeoc.gov/press/12-26-07.html

Health coverasge for retirees
If this EEOC description is correct, it still leaves retirees wondering how much latitude employers have to drop coverage. (emphasis mine).

In general, if AARP is against something of this sort, I side with AARP. If, as the Times suggests, AARP is unhappy with the rule, I feel that that is a good reason to be concerned.

Re: Health coverasge for retirees


AARP is been known to go chasing things for silly reasons in the past. In this particular case they filed a lawsuit to block the rule (and lost) and in their own court briefs they admitted that if their view was upheld several million retirees could lose all of their employer provided insurance but that they were willing to risk that to uphold the principle that age discrimination is wrong.

While standing on principle is fine it seems silly to do when it shoots yourself in the foot.

If every group with an interest was against this rule I'd be more concerned. It appears that the AARP is the only group that is against it though. The labor unions, etc.. all seem to be in agreement with it.