The newspaper offered these examples of the trend:
- More than 16,000 retirees from Monsanto are embroiled in a lawsuit concerning changes to their retirement benefits, which were made when a portion of Monsanto was spun off into a separate company, Solutia. The suit is to be heard in September.
- The Johns Manville Retirees Association, representing 3,000 retirees, is trying to maintain its health benefits at current levels and get a cost-of-living pension increase.
- A group representing 45,000 retirees of US West, now Qwest, is negotiating with the company, focusing mainly on restoring some health benefits, including coverage for spouses and an update in dental benefits.
Companies tell USA Today that the changes in retiree benefits come in response to financial pressures brought by a weakening economy and soaring health insurance costs. Health insurance premiums, after staying relatively flat at mid-decade, are returning to double-digit increases.
"To control the rising costs of health care, we have had to ask retirees and current employees to share the cost," says Melody Dunbar, spokeswoman for Johns Manville in Denver.
Only 37 percent of firms offer health benefits to those taking early retirement, while 27 percent offer health coverage to Medicare-age retirees. That's down from the 1980s, when about 70 percent of early retirees had coverage, according to a May report by the General Accounting Office.
And 25 percent of firms with existing retiree coverage have increased the retirees' share of their premium contribution during the past two years, according to the William Mercer benefits firm. About 10 percent of firms increased the amounts retirees pay toward annual deductibles and co-payments for office visits and other services.
The 8,400 Johns Manville retirees pay 8.5 percent of the cost of their health insurance, Dunbar says. Active employees, on average, pay 16 percent of their costs. The company picks up the remainder.
In the past two years, those retirees have faced a 20 percent increase in what they pay toward their health insurance. On average, they now pay $33 a month for health care, Dunbar says.
John Leasher of the Johns Manville Retirees Association, says the retirees haven't had a cost-of-living adjustment in their pensions since 1980 and are now facing increases in health insurance costs.
"Once benefits have been promised and someone has retired, the company cannot renege on that," says Leasher.
Other companies have told retirees that once premiums hit a pre-established amount, the retirees would be responsible for paying any increase that occurs after that.
"We have said for years to our retirees that we have established caps, and when we reached the cap, they will have to make a contribution toward the premium," says IBM spokeswoman Jana Weatherbee, who noted that the company spends more than half a billion annually on retiree health.
To view the USA Today story, click here.
only are fewer companies offering new retirees health coverage, but many of those that have benefit plans are scaling them down, angering former employees, according to USA Today.