Wall Street Journal Examines Cost-Shifting Trend at Large Companies
The Wall Street Journal today examines the "rude awakening" faced by many employees at large companies that have asked them to "take a hit" in their health insurance and retirement account benefits. Many large companies, faced with "meager profits and a sputtering economic recovery," have moved to reduce labor costs, such as health coverage. Companies such as Wal-Mart, Ford, General Motors and General Electric have begun to pass more of the cost of health insurance to employees through increased copayments and premiums and have reduced the amount of coverage provided. In addition, many companies have reduced health coverage and increased out-of-pocket costs for retirees, "who can't go on strike and who are living longer thanks in part to better, more expensive medical care," the Journal reports. According to the Kaiser Family Foundation, employees today pay 27% more on out-of-pocket health care costs than they did in 2001. However, the Journal reports that "employees aren't taking all the proposed cuts quietly"; for example, in response to a proposed increase in health insurance copayments, GE workers last month voted to authorize a strike "if necessary" (Lieber/Martinez, Wall Street Journal, 11/26).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.