Bristling at Health Plan to Cover Early Retirees
The New York Times, September 9th, 2009
Within the battle over
President Obama’s
health care overhaul, critics of organized labor have latched onto a
little-noticed provision in the legislation already circulating in
Congress. The provision would cost $10 billion in federal money to
subsidize employer-sponsored health plans covering early retirees, as a
bridge to
Medicare.
Labor’s critics assert that the provision, aimed at retirees ages 55
to 64, is a Democratic payback to unions and would further drive up the
federal deficit.
“It looks like it’s just a big giveaway of $10
billion to bail out a bunch of unionized companies,” said Gregory
Mourad, director of legislation for the National Right to Work
Committee, a nonprofit group that often battles organized labor. “It’s
part of a Christmas list of giveaways to unions.”
But supporters deny that the provision is a sop to labor, saying it would help stabilize the health insurance system and would benefit union and nonunion retirees alike, as well as their employers. Backers include the United Automobile Workers, the United Steelworkers and the A.F.L.-C.I.O.
Variations of this program have been approved by the three House
committees that have adopted health bills, and by the Senate Health,
Education, Labor and Pensions Committee.
It is not clear
whether the provision will be included in whatever bill the Senate
Finance Committee may eventually come up with, under the chairmanship
of
Max Baucus,
Democrat of Montana. Under the provision, the federal government would
pay as much as $10 billion to cover 80 percent of the cost of an early
retiree’s medical claims of more than $15,000, with a cap at $90,000 —
at which point the employer’s plan would pay the rest.
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