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Old 12-27-2007, 04:55 AM   #1
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<BLOCKQUOTE class="ip-ubbcode-quote"><div class="ip-ubbcode-quote-title">quote:</div><div class="ip-ubbcode-quote-content">WASHINGTON " The Equal Employment Opportunity Commission said Wednesday that employers could reduce or eliminate health benefits for retirees when they turn 65 and become eligible for Medicare. </div></BLOCKQUOTE>
On edit, I deleted the URL link to the NY Times article due to advertisements popping up before you could read the article. Included below is the complete article -- apologize for the length, but this ruling has broad ramifications for retirees.
<BLOCKQUOTE class="ip-ubbcode-quote"><div class="ip-ubbcode-quote-title">quote:</div><div class="ip-ubbcode-quote-content">U.S. Ruling Backs Benefit Cut at 65 in Retiree Plans

By ROBERT PEAR
Published: December 27, 2007
WASHINGTON " The Equal Employment Opportunity Commission said Wednesday that employers could reduce or eliminate health benefits for retirees when they turn 65 and become eligible for Medicare.

The policy, set forth in a new regulation, allows employers to establish two classes of retirees, with more comprehensive benefits for those under 65 and more limited benefits " or none at all " for those older.

More than 10 million retirees rely on employer-sponsored health plans as a primary source of coverage or as a supplement to Medicare, and Naomi C. Earp, the commission's chairwoman, said, "This rule will help employers continue to voluntarily provide and maintain these critically important health benefits."

Premiums for employer-sponsored health insurance rose an average of 6.1 percent this year and have increased 78 percent since 2001, according to surveys by the Kaiser Family Foundation. Because of the rising cost of health care and the increased life expectancy of workers, the commission said, many employers refuse to provide retiree health benefits or even to negotiate on the issue.

In general, the commission observed, employers are not required by federal law to provide health benefits to either active or retired workers.

Dianna B. Johnston, a lawyer for the commission, said many employers and labor unions had told it that "if they had to provide identical benefits for retirees under 65 and over 65, they would just drop retiree health benefits altogether for both groups."

In a preamble to the new regulation, published Wednesday in the Federal Register, the commission said, "The final rule is not intended to encourage employers to eliminate any retiree health benefits they may currently provide."

But AARP and other advocates for older Americans attacked the rule. "This rule gives employers free rein to use age as a basis for reducing or eliminating health care benefits for retirees 65 and older," said Christopher G. Mackaronis, a lawyer for AARP, which represents millions of people age 50 or above and which had sued in an effort to block issuance of the final regulation. "Ten million people could be affected " adversely affected " by the rule."

The new policy creates an explicit exemption from age-discrimination laws for employers that scale back benefits of retirees 65 and over. Mr. Mackaronis asserted that the exemption was "in direct conflict" with the Age Discrimination in Employment Act of 1967.

The commission, by contrast, said that under that law, it could establish "such reasonable exemptions" as it might find "necessary and proper in the public interest." The United States Court of Appeals for the Third Circuit, in Philadelphia, upheld this claim in June, in the case filed by AARP, which has asked the Supreme Court to review the decision.

In its ruling, the appeals court said, "We recognize with some dismay that the proposed exemption may allow employers to reduce health benefits to retirees over the age of 65 while maintaining greater benefits for younger retirees." But the court said the commission had shown that the exemption was "a reasonable, necessary and proper exercise" of its authority.

Under the new rule, employers may, if they choose, provide retiree health benefits "only to those retirees who are not yet eligible for Medicare." Likewise, the rule says, retiree health benefits can be "altered, reduced or eliminated" when a retiree becomes eligible for Medicare.

Further, employers will be able to reduce or eliminate health benefits provided to the spouse or dependents of a retired worker 65 or over, regardless of whether benefits for the retiree are changed.

Employers and some unions contend that retirees under 65 have a greater need for employer-sponsored health benefits because they are generally not Medicare-eligible. Large employers have often provided some health benefits to retirees 65 and older, to help cover costs not paid by Medicare. But employers have for years been trying to reduce retiree benefits or to shift more of the cost to retirees.

Lawyers for the commission said the new Medicare drug benefit, now nearing the end of its second year, had strengthened the case for the regulation because it guaranteed that retirees 65 and older would have access to drug coverage. Younger retirees have no such guarantee, so employers may want to provide drug coverage to them in particular, the lawyers said.

Helen Darling, president of the National Business Group on Health, which represents large employers, welcomed the rule.

"If employers could not coordinate with Medicare, they would be far less likely to provide health coverage" to retirees, Ms. Darling said. "They could not afford to."

A study by the Government Accountability Office in 2001 estimated that one-third of large employers and fewer than one-tenth of small employers offered health benefits to retirees. Ms. Darling said newer retirees often received not comprehensive coverage but instead a fixed amount of money, based on years of service, to help them with their medical costs.

James A. Klein, president of the American Benefits Council, a lobby for large employers, said: "The new rule is a victory for common sense and for retirees. Retiree health coverage has been declining for many years. Without this rule, many more retirees, especially early retirees, could find themselves without employer-sponsored coverage."

Gerald M. Shea, assistant to the president of the A.F.L.-C.I.O., also saw merit in the new rule.

"Given the enormous cost pressures on employer-sponsored health benefits," Mr. Shea said, "we support the flexibility reflected in the rule as a way to maximize our ability to maintain comprehensive coverage for active and retired workers."

Schoolteachers, like many other public employees, often retire early and rely on employer-provided health benefits until they become eligible for Medicare. At a Congressional hearing in 2005, the National Education Association and Representative John A. Boehner of Ohio, who is now the House Republican leader, supported the proposed rule. The teachers union said it feared that employers would cut health benefits for early retirees if they had to provide identical benefits to those over 65 and those under.
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Old 12-27-2007, 04:55 AM   #2
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Quote:
WASHINGTON " The Equal Employment Opportunity Commission said Wednesday that employers could reduce or eliminate health benefits for retirees when they turn 65 and become eligible for Medicare.
On edit, I deleted the URL link to the NY Times article due to advertisements popping up before you could read the article. Included below is the complete article -- apologize for the length, but this ruling has broad ramifications for retirees.
Quote:
U.S. Ruling Backs Benefit Cut at 65 in Retiree Plans

By ROBERT PEAR
Published: December 27, 2007
WASHINGTON " The Equal Employment Opportunity Commission said Wednesday that employers could reduce or eliminate health benefits for retirees when they turn 65 and become eligible for Medicare.

The policy, set forth in a new regulation, allows employers to establish two classes of retirees, with more comprehensive benefits for those under 65 and more limited benefits " or none at all " for those older.

More than 10 million retirees rely on employer-sponsored health plans as a primary source of coverage or as a supplement to Medicare, and Naomi C. Earp, the commission's chairwoman, said, "This rule will help employers continue to voluntarily provide and maintain these critically important health benefits."

Premiums for employer-sponsored health insurance rose an average of 6.1 percent this year and have increased 78 percent since 2001, according to surveys by the Kaiser Family Foundation. Because of the rising cost of health care and the increased life expectancy of workers, the commission said, many employers refuse to provide retiree health benefits or even to negotiate on the issue.

In general, the commission observed, employers are not required by federal law to provide health benefits to either active or retired workers.

Dianna B. Johnston, a lawyer for the commission, said many employers and labor unions had told it that "if they had to provide identical benefits for retirees under 65 and over 65, they would just drop retiree health benefits altogether for both groups."

In a preamble to the new regulation, published Wednesday in the Federal Register, the commission said, "The final rule is not intended to encourage employers to eliminate any retiree health benefits they may currently provide."

But AARP and other advocates for older Americans attacked the rule. "This rule gives employers free rein to use age as a basis for reducing or eliminating health care benefits for retirees 65 and older," said Christopher G. Mackaronis, a lawyer for AARP, which represents millions of people age 50 or above and which had sued in an effort to block issuance of the final regulation. "Ten million people could be affected " adversely affected " by the rule."

The new policy creates an explicit exemption from age-discrimination laws for employers that scale back benefits of retirees 65 and over. Mr. Mackaronis asserted that the exemption was "in direct conflict" with the Age Discrimination in Employment Act of 1967.

The commission, by contrast, said that under that law, it could establish "such reasonable exemptions" as it might find "necessary and proper in the public interest." The United States Court of Appeals for the Third Circuit, in Philadelphia, upheld this claim in June, in the case filed by AARP, which has asked the Supreme Court to review the decision.

In its ruling, the appeals court said, "We recognize with some dismay that the proposed exemption may allow employers to reduce health benefits to retirees over the age of 65 while maintaining greater benefits for younger retirees." But the court said the commission had shown that the exemption was "a reasonable, necessary and proper exercise" of its authority.

Under the new rule, employers may, if they choose, provide retiree health benefits "only to those retirees who are not yet eligible for Medicare." Likewise, the rule says, retiree health benefits can be "altered, reduced or eliminated" when a retiree becomes eligible for Medicare.

Further, employers will be able to reduce or eliminate health benefits provided to the spouse or dependents of a retired worker 65 or over, regardless of whether benefits for the retiree are changed.

Employers and some unions contend that retirees under 65 have a greater need for employer-sponsored health benefits because they are generally not Medicare-eligible. Large employers have often provided some health benefits to retirees 65 and older, to help cover costs not paid by Medicare. But employers have for years been trying to reduce retiree benefits or to shift more of the cost to retirees.

Lawyers for the commission said the new Medicare drug benefit, now nearing the end of its second year, had strengthened the case for the regulation because it guaranteed that retirees 65 and older would have access to drug coverage. Younger retirees have no such guarantee, so employers may want to provide drug coverage to them in particular, the lawyers said.

Helen Darling, president of the National Business Group on Health, which represents large employers, welcomed the rule.

"If employers could not coordinate with Medicare, they would be far less likely to provide health coverage" to retirees, Ms. Darling said. "They could not afford to."

A study by the Government Accountability Office in 2001 estimated that one-third of large employers and fewer than one-tenth of small employers offered health benefits to retirees. Ms. Darling said newer retirees often received not comprehensive coverage but instead a fixed amount of money, based on years of service, to help them with their medical costs.

James A. Klein, president of the American Benefits Council, a lobby for large employers, said: "The new rule is a victory for common sense and for retirees. Retiree health coverage has been declining for many years. Without this rule, many more retirees, especially early retirees, could find themselves without employer-sponsored coverage."

Gerald M. Shea, assistant to the president of the A.F.L.-C.I.O., also saw merit in the new rule.

"Given the enormous cost pressures on employer-sponsored health benefits," Mr. Shea said, "we support the flexibility reflected in the rule as a way to maximize our ability to maintain comprehensive coverage for active and retired workers."

Schoolteachers, like many other public employees, often retire early and rely on employer-provided health benefits until they become eligible for Medicare. At a Congressional hearing in 2005, the National Education Association and Representative John A. Boehner of Ohio, who is now the House Republican leader, supported the proposed rule. The teachers union said it feared that employers would cut health benefits for early retirees if they had to provide identical benefits to those over 65 and those under.
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Old 12-27-2007, 07:15 AM   #3
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I always understood that company's could drop medical coverage for retirees anytime they chose to.

Now that my wife is medicare eligible in January we are dropping my employer provided supplemental policy in order to save money. By switching to other coverage we will save over $4000.00 per year in premiums with the same or even better coverage!

As you can see there is more than one way an employer can drop your coverage by just pricing it out of sight!

Bill
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Old 12-27-2007, 09:33 AM   #4
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I understand both sides of the issue.

I have never been a big fan of unions. But I am also not a big fan of corporate greed, as evidenced by CEO making 100's of times what the average workers wage is.

Free enterprise should drive this county and we should get rid of government welfare. We also need to reform upper management wages and benefits that companies provide.

I would like to see some sort of sliding scale that would offer companies an incentive to keep manufacturing and service jobs IN the U.S.

It is hard for a kid to go to school to learn how to program with the hopes of making a decent wage here to see that job move off shore to someone who makes 15/hr. OR maybe should off shore the CEO jobs.

Soap box time done.
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Old 12-27-2007, 11:28 AM   #5
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<BLOCKQUOTE class="ip-ubbcode-quote"><div class="ip-ubbcode-quote-title">quote:</div><div class="ip-ubbcode-quote-content">Originally posted by Dutch_man39:
I always understood that company's could drop medical coverage for retirees anytime they chose to. </div></BLOCKQUOTE>
And, there are lots of companies that don't even offer retirees a medical plan.
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Old 12-27-2007, 07:15 PM   #6
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<BLOCKQUOTE class="ip-ubbcode-quote"><div class="ip-ubbcode-quote-title">quote:</div><div class="ip-ubbcode-quote-content">And, there are lots of companies that don't even offer retirees a medical plan. </div></BLOCKQUOTE>

Yeah, that's what I was thinking. I've got a gov job, and cobra out of your pocket when you leave is it... Then you are on your own.

There was an interesting article in the last Consumer Reports. Surprisingly minor medical issues can result in someone seeking individual coverage from being offered coverage. Scary.
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Old 12-28-2007, 06:29 AM   #7
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We have been retired for 18 months and are paying for our health insurance. The monthly premium has increased 11.5% in that time.
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Old 12-29-2007, 06:34 AM   #8
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I get my medical covered with my retirement plus I pay some into it also. This will affect my wife and I when we reach 65 (if the company I retired from decides to take advantage of this which I'm sure they will). Once I receive medicare my supplement coverage would be covered fully and I would pick up my wife for $100/month the old way. If the company does away with it then I'll have to pay for both of our extended coverage.

Goverment here to help us when you are on a fixed income then make it so I have to pay out more of that fixed income.
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Old 12-29-2007, 08:38 AM   #9
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People cry at the cost of insurance I for one think the Doctors and Hospitals write the rules and price Us all out of greed.I cry also and I always thought the Golden Years were to be looked at as a great time in life now I am sure there not so Golden...Bushman
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Old 12-29-2007, 11:51 AM   #10
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This is where I say "Thank God for the VA"

I am fully covered by Veterans Health Care for everything except dental work and in a life or death emergency, even that is covered..

All I pay is $8 per prescription once a month...(2 x $8 = $16.00)

Everything else, operations, doctors, eye exams, eyeglasses, hospitalization, etc... is free..

I am not being "lite" about this...
because I fully realize that if it were not for the VA, I would have been dead and buried in a pauper's grave ten years ago...

I truly feel bad for those folks who have to pay big money for medical needs...

I don't understand why the USA cannot set up a national health plan with a standardized monthly payment that everybody could afford.

Best Wishes,
John
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Old 12-30-2007, 11:15 AM   #11
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From John:

I don't understand why the USA cannot set up a national health plan with a standardized monthly payment that everybody could afford.
____________________________________
John, as with any government program, the free approach (or nearly free) leads to abuse. Here in Arizona we have emergency rooms that MUST take those who come in, no matter the problem.

A few years ago I had need to go to the ER and had to wait 5 hours to be seen for what was a truly life/death matter. But, the waiting room was full to the brim with Hispanic families and kids waiting to be seen for common colds. They were all, with 1 exception, "take two of these pills and get some rest" solutions. They were there because they could get the pills for free instead of going to a pharmacy.

In addition, it took me 5 hours because Hispanic watchdog groups post people in ERs to make sure they are accomodated. Even though I was in bad shape, personel couldn't see to my needs for fear of being sued by some reactionary radical cause.

As it turned out, the Doctor got to me in time (my blood sodium level had dropped to a level the Doctor said should have been fatal).

Free leads to overuse=abuse. Ask the Canadians, Swedes and Brits.
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Old 12-30-2007, 04:38 PM   #12
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<BLOCKQUOTE class="ip-ubbcode-quote"><div class="ip-ubbcode-quote-title">quote:</div><div class="ip-ubbcode-quote-content">That could mean more expansive benefits for retirees under 65 than those who are over 65, says the AARP, a membership organization that represents older Americans. "The EEOC moved toward legitimizing discrimination based on age," spokesman Drew Nannis says. "This is a civil rights issue." </div></BLOCKQUOTE>

I agree with the above quote from a recent article titled "Reactions vary on changes to retiree health benefits rule" by Stephanie Armour in "USA Today"
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Old 12-31-2007, 09:57 AM   #13
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<BLOCKQUOTE class="ip-ubbcode-quote"><div class="ip-ubbcode-quote-title">quote:</div><div class="ip-ubbcode-quote-content">Free leads to overuse=abuse. Ask the Canadians, Swedes and Brits. </div></BLOCKQUOTE>
Perhaps, but the US ranks lower than those countries according to the WHO.
We are 37th between Costa Rica and Slovenia.

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Old 12-31-2007, 12:33 PM   #14
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I believe the United States is the only developed nation without a universal healthcare system. Not something to be proud of, but none of our politician's on either side of the fence have the necessary attributes(?) to press for change.

There are too many free-loaders using the system and other public funded programs that need to get off their butts and get a job. I don't see any changes in the near future. We will continue to pay more and more for health care in order to subsidize the system.

Off my soap box--thanks for listening to an aging veteran who was assured of free heath care back in the 60's for 20-30 years of service.
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