Changes In Health Care For Retired Workers

3 Pages 748 Words

Changes in Health Care for Retired Workers


Health care for retired workers is always changing and it’s not for the better. The workforce had changed remarkably causing retirement plans to decline. Current workers are being pressured to pay more out of pocket. These retirees are rarely helped out and when they are, it isn’t enough. It is difficult for employees to provide the best health care for their workers and remain competitive in today’s economy.
Employers are providing health care to stay competitive in the marketplace, but this trend is dissipating. These employers are finding it increasingly difficult to provide these benefits to retired workers. The employers are focusing on health care costs and are not able to absorb additional cost increases. Current law severely limits employers’ ability to pre-fund retires health care obligations. As a result of this law, employers have capped contributions, increased co pays, increased employee contributions, or even eliminated benefits all together. The Employee Retirement Income Act states that employers are not required to provide any health care coverage to their workers, either active or retired. Although, once they decide to offer benefits they must follow certain requirements. Currently, only thirty five percent of employers sponsor retiree health care, leaving many with out access. Employers who offer medical coverage for retirees went from forty percent in 1993 to twenty percent in 2001. That leaves more than three quarters of the retired population with out health coverage. Health care costs are rising for both active and retired employees and new pension funding requirements have wiped out corporate benefits budgets. This leaves less money for the retiree to live healthy in a world that is to expensive.

Retirees depend on health care from current or past employers, and it’s the only likely source of affordable reliable coverage. In 2003 cost for employer pl...