There Are Steps Retirees Can Take
By Wendy J Meyeroff
THE ERICKSON TRIBUNE
Even if you currently have employer-sponsored retiree health benefits (and only about 12 million out of more than 40 million people age 65 and over do) experts agree it’s not wise to get complacent, given all the layoffs and cutbacks employees are finding from major corporations including Ford, IBM, and Sears. For information on the risks older Americans face to their health benefits and ways to protect themselves, The Erickson Tribune spoke to several experts.
Last year, Hewitt Associates and the Kaiser Family Foundation conducted a survey specifically for age 65-plus retirees most likely to be affected by Medicare changes.
Current employees are already feeling the hammer come down on their health benefits, but it is less likely to happen to retirees.
“In 2006, most companies are accepting a government subsidy to keep retiree health benefits in response to the institution of the Medicare Part D drug benefit,” says Frank McArdle, manager of the Washington, D.C. research office of Hewitt Associates.
That doesn’t mean retirees are not at risk. “We did find 9 percent of companies (generally smaller employers) say they would discontinue prescription drug coverage, and sometimes discontinue both medical and drug coverage for retirees,” he says.
Prepare to Pay More
“Between 2004 and 2005 most firms increased what retirees pay for health benefits in some form or another. It could be in the amount retirees paid towards their premiums (71 percent raised that rate); it could mean paying a higher deductible, or it could be an increase in your co-payment,” says McArdle. Start factoring health costs into your monthly budget, just the way you factor in increased heating bills. Find ways to trim expenses not related to health.
Simple Substitutions