Health Benefits for Retirees Continue to Shrink, Study Says Wall Street Journal (09/16/02) p.A2; Greene, Kelly
A recent Watson Wyatt Worldwide survey of 56 retiree health plans indicated that 17 percent have been practically eliminated, and 20 percent of those plans were eliminated for new employees. Employers are increasing retirees' share of health insurance premiums, requiring employees to remain with the company longer before being eligible for the benefits, and capping the amount of money the company will pay for annual premiums. Companies have reduced their premium shares, in most cases, from 80 percent to 60 percent, and have capped payments at $3,900 for future retirees, down from an average of $4,450 per retiree. Some employers are using medical accounts, where a fixed dollar amount is assigned for each year of service, and then the money is applied to health insurance benefits.