mommalina
06-02-2006, 11:01 AM
Before you take that job or if you think your current employer retiree health benefits are secure, check this out.
This U.S. Department of Labor web site explains how to determine if your employer retiree health benefits will be secure. Check the fine print!
http://www.dol.gov/ebsa/publications/retiree_health_benefits.html
DOL Home Page
U.S. Department of Labor
Employee Benefits
Security AdministrationWhat to Look for in Plan Documents
Check all your plan documents with the following questions in mind:
Do the SPD or other plan documents promise that health benefits after retirement will continue at a specified level for a certain period of time?
If there is no specific language describing retiree health benefits in your plan documents, it is unlikely that you have coverage. If there is such language, how specific is it?
Sometimes language covering retiree health benefits is included in the documents, but it is too vague to stand up to a test in the courts. Conversely, there is language on employee health benefits that has held up in court. Here is an example:
"Basic health care coverages will be provided at the company's expense for your lifetime."
Even if a specific promise is made, is there also language that gives your former employer the right to change or terminate that specific promise or to amend or terminate the entire plan?
Typical language giving the employer that right might read:
"The company reserves the right to modify, revoke, suspend, terminate, or change the program, in whole or in part, at any time."
This is an actual example, but other similar language may be found anywhere in the plan documents.
If you are an employee reviewing the current plan, it is important to remember that it can change in the future. The documents in effect when you retire are the ones that will determine your health benefits, if any, in your retirement. However, court rulings in these matters have not been uniform.
Lina
This U.S. Department of Labor web site explains how to determine if your employer retiree health benefits will be secure. Check the fine print!
http://www.dol.gov/ebsa/publications/retiree_health_benefits.html
DOL Home Page
U.S. Department of Labor
Employee Benefits
Security AdministrationWhat to Look for in Plan Documents
Check all your plan documents with the following questions in mind:
Do the SPD or other plan documents promise that health benefits after retirement will continue at a specified level for a certain period of time?
If there is no specific language describing retiree health benefits in your plan documents, it is unlikely that you have coverage. If there is such language, how specific is it?
Sometimes language covering retiree health benefits is included in the documents, but it is too vague to stand up to a test in the courts. Conversely, there is language on employee health benefits that has held up in court. Here is an example:
"Basic health care coverages will be provided at the company's expense for your lifetime."
Even if a specific promise is made, is there also language that gives your former employer the right to change or terminate that specific promise or to amend or terminate the entire plan?
Typical language giving the employer that right might read:
"The company reserves the right to modify, revoke, suspend, terminate, or change the program, in whole or in part, at any time."
This is an actual example, but other similar language may be found anywhere in the plan documents.
If you are an employee reviewing the current plan, it is important to remember that it can change in the future. The documents in effect when you retire are the ones that will determine your health benefits, if any, in your retirement. However, court rulings in these matters have not been uniform.
Lina