New EEOC rule might cost many retirees their health benefits

I predict that we are going to hear a lot of howling from retiree quarters when the inevitable letters start landing in mailboxes that inform retirees that their health bennies are being cut.

The Equal Employment Opportunity Commission said Wednesday that employers could reduce or eliminate health benefits for retirees when they turn 65 and become eligible for Medicare.

The policy, set forth in a new regulation, allows employers to establish two classes of retirees, with more comprehensive benefits for those under 65 and more limited benefits — or none at all — for those older.

More than 10 million retirees rely on employer-sponsored health plans as a primary source of coverage or as a supplement to Medicare, and Naomi C. Earp, the commission’s chairwoman, said, “This rule will help employers continue to voluntarily provide and maintain these critically important health benefits.”

Premiums for employer-sponsored health insurance rose an average of 6.1 percent this year and have increased 78 percent since 2001, according to surveys by the Kaiser Family Foundation. Because of the rising cost of health care and the increased life expectancy of workers, the commission said, many employers refuse to provide retiree health benefits or even to negotiate on the issue.

In general, the commission observed, employers are not required by federal law to provide health benefits to either active or retired workers.

The new regulation was published Wednesday in the Federal Register. The EEOC was quick to get it on the record that the new regulation is not intended to “encourage employers to eliminate any retiree health benefits they may currently provide.” (Even though everyone with more than three functioning neural synapses knows that will be the net effect, and it will occur in short order.)

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An EEOC lawyer, Dianna B. Johnston, said that many employers and labor unions had reported to the commission that if they were required to provide identical health benefits for retirees over 65 (those eligible for Medicare) and those under, they would simply drop coverage for both groups, because the cost of health care is prohibitively expensive. The new rule will allow employers to, at their own discretion, provide retiree health benefits “only to those retirees who are not yet eligible for Medicare.” After age 65, retiree health benefits can be “altered, reduced or eliminated” when retirees become eligible for Medicare.

Employers will also be able to reduce or eliminate entirely health benefits for spouses or dependents of retirees over 65, regardless of whether the retiree benefits are changed. (Many of whom do not have their own coverage, especially housewives and part-time workers.)

The AARP attacked immediately. “This rule gives employers free rein to use age as a basis for reducing or eliminating health care benefits for retirees 65 and older,” said Christopher G. Mackaronis, a lawyer for the organization. “Ten million people could be affected — adversely affected — by the rule.” He also asserted that the new rule was a direct violation of the Age Discrimination in Employment Act of 1967.

It is a given that people over 65 consume more medical services than those under 65, and it is common knowledge that Medicare is available for all U.S. citizens 65 years of age and older. For several years employers have been trying to reduce benefits or shift some of the burden to the retirees themselves. The Medicare Part D drug benefit (donut hole and all) provides the cover necessary to make the change.

President of the American Benefits Council, James Klein, asserts that the new regulation is "a victory for common sense and for retirees. Retiree health coverage has been declining for many years. Without this rule, many more retirees, especially early retirees, could find themselves without employer-sponsored coverage.”

I appreciate the arguments being made - and I understand acutely the difficulties of the health care delivery system - I'm one of those youthful retirees, and I retired from a health care career - But I am not so sure that anyone affected is going to be convinced that it is a "victory for common sense and retirees. "

Come on! Seriously! If this wasn't a classic case of pissin' on my leg and tellin' me it was raining, do you really believe the announcement would be made the day after Christmas, in the midst of the slowest news week of the year? Because if you do, contact me immediately about this bridge I have for sale...

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Palmer packs it in

A couple of weeks ago, I wrote a post about David Palmer, Bush’s nominee to head up the Equal Employment Opportunity Commission. He was tapped by aWol to head up a section of the Justice Department that had found him in violation of the essential tenets of that department.

Well, over the weekend the hapless and unconfirmed Palmer packed it in and withdrew his name from consideration. "I have received what can only be called a crash course in how bitterly partisan the nomination process has become," he wrote in his withdrawal letter to Bush. He went on to complain that congressional staffers had (*Gasp!!! Horrors!!!*)…probed his background! Every aspect of it!

"Many of the questions I was asked were troubling," he wrote. "Most disturbingly, one question explicitly suggested that I chose to ignore discrimination against Latinos, a question I found particularly offensive in light of the fact that I myself am the son of Latino immigrants."

The poor little Loyal Bushie just doesn’t understand why he might be scrutinized, and held to account (don’t the hoi polloi on the Democratic side of the aisle realize everything is okay so long as you are a republican???)

Well Dave, (you don’t mind if I call you Dave, do you?) maybe they asked that sublimely impertinent question because the litigation section has filed almost as many cases alleging discrimination against whites as it has against blacks and Latinos combined, even while Palmer acknowledges that minorities tend to be the targets of more discrimination.

Just hazarding a guess, here, Sport, but I would wager that little statistical gem was at least a factor. And probably a bigger one than “Democrats are meanies.”

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The perfect nominee...

Eight former employees of the Justice Department have written a letter asking key senators to block the nomination of David Palmer to head the Equal Employment Opportunity Commission.

The former justice officials, including three ex-deputy section chiefs allege that Palmer’s “work performance was well below the high standards expected of Department of Justice attorneys."

They charge that in 2002, when Palmer was section chief, he actively undermined the unit’s mission to secure employment rights for women and minorities in the public sector, and he defended an employer’s right to discriminate based on religion (or presumably, lack there of).

The former employees' letter to Democratic Sen. Edward Kennedy of Massachusetts, chairman of the Senate Committee on Health, Education, Labor and Pensions, and ranking Republican Sen. Mike Enzi of Wyoming didn't specify the circumstances of Palmer's alleged employee abuse. But it accused Palmer of treating many employees "with disdain and contempt."

Marian Thompson, who worked in the section for 18 years as a statistician, said that after becoming section chief in 2002, Palmer fired a veteran attorney with whom he had had a romantic relationship and that the woman filed a complaint against him. In a phone interview, Thompson expressed surprise that Palmer did not let someone else handle that personnel decision.

Richard Ugelow, a former section chief who teaches employment law at American University, said that it was "unheard of for the head of an agency charged with enforcing equal employment opportunity laws to be charged with violating those laws. ... He's supposed to be above reproach, to set an example for other employers."

Thompson said Palmer told her after taking over as chief that it was "ironic" that he was now supervising the lawyer who had reprimanded him for an omission in a discrimination case.

A Justice Department official, who declined to be identified on a personnel matter, said that under Palmer's stewardship, the employment litigation section's record has been "comparable to that of the previous administration." The official cited a recent suit against the city of New York that charged that its fire department, the nation's largest, uses a hiring examination that discriminates against African-Americans and Hispanics.

I wish I could work up at least a bit of shock, but sadly, I can’t. It is just par for the course for these jackals to put forth the worst nominee possible. So why not a nominee to head up the EEOC who has been sued for violating its tenets? For this crew, it might actually be a requirement that you be in violation of those contemptible rules you are supposed to undermine enforce.

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