Citing costs, IBM to move retirees off health plan
Published September 07, 2013
The Wall Street Journal
International Business Machines Corp. plans to move about 110,000 retirees off its company-sponsored health plan and instead give them a payment to buy coverage on a health-insurance exchange, in a sign that even big, well-capitalized employers aren’t likely to keep providing the once-common benefits as medical costs continue to rise.
The move, which will affect all IBM retirees once they become eligible for Medicare, will relieve the technology company of the responsibility of managing retirement health-care benefits. IBM said the growing cost of care makes its current plan unsustainable without big premium increases.
IBM’s shift is an indication that health-insurance marketplaces, similar to the public exchanges proposed under President Barack Obama’s health-care overhaul, will play a bigger role as companies move coverage down the path taken by many pensions, paying employees and retirees a fixed sum to manage their own care.
In notices signed by Chief Health Director Kyu Rhee, IBM has told retirees in recent weeks that to keep receiving coverage, they will need to pick a plan offered through Extend Health, a large private Medicare exchange run by New York-based Towers Watson & Co.
Read more: https://www.foxnews.com/us/2013/09/07/ibm-to-move-retirees-off-health-plan/#ixzz2eI6l6djW