When employer-sponsored health insurance began, people often worked for the same employer for most of their lives—there was an unwritten contract between a corporation and its workers to provide health benefits, retirement benefits, and lifetime employment.
This contract was shattered during the past two decades as globalization forced employers to lower their labor costs to remain in business.
- If you currently work for one of the few companies that provide retiree health benefits, don't expect your company to still be providing them when you retire.
- If you are currently receiving retiree benefits, don't count on these benefits continuing unless your former employer is bound by an ironclad contract.
- Even if your former employer is bound by a contract, unless the company is exceptionally strong, your retiree health benefits may be terminated through bankruptcy court. ERISA law protects pensions, but not retiree health benefits, against corporate bankruptcy.
- If you work for a state or local government entity that provides free retiree health benefits, you might get to keep them. But I wouldn't count on getting any more such benefits once the taxpayers learn how they have been deceived into paying for something that they don't get themselves.
- If you or a spouse work for a school district or are contemplating taking a teaching or government job for a few years, you should look into what type of retiree health benefits they offer, as this could be the health insurance deal of the century…for as long as it lasts.
What can you do to ensure that your retiree health benefits continue? Pilzer offers suggestions on page 2.