Originally published July 10 2005
Companies not keeping up with retiree health care cost
by Mike Adams, the Health Ranger, NaturalNews Editor
Given the growing price of health care for retirees, companies are struggling to support their own promises. These mistakes in coverage are now being amended in today's workforce: benefits are being cut and co-payments are rising.
When three of her 13 medications arrived by mail last week, the Michigan Center resident learned she'd have to pay $240 -- more than enough to erase the $192 monthly pension check from her former employer.
"I do hope my money doesn't run out before I do," Licking said, "and I worry that may happen."
Where Licking used to work, paying for people like her to get medical care brings its own aches.
Eaton Corp. has seen its retiree health costs soar, usually by double digits percentage-wise each year.
Welcome to the retirement system's health-care crossroads -- a battle between seniors starved for financial security and employers tired of throwing money at a problem they can hardly control.
Alarmed by steep medical bills and financial promises they can barely keep, local businesses and governments are moving to rein in retirees' health-care costs.
"I sort of take the view that a deal's a deal," said John Tropman, a University of Michigan business school professor.
That figure doubled in six years, leading two county administrators to try to hike prescription-drug co-pays.
For Jackson Public Schools, the area's largest school district, the increase alone next year will top $500,000.
While changes can be made for current workers' heath plans, there's often little that can be done for those who finished their careers and walked away with a promise of health care for life.
That's why they pushed in contract talks last year to require retirees -- for the first time -- to pay monthly health-insurance premiums.
That feeling was compounded when, months after signing the contract, Eaton announced a $2 billion contract for work on a military fighter plane.
"The contribution they made in the past is what allows this company to prosper today," Rice said.
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