CORRE Blog

Bob Henderson writes:

"Joe" had attended evening school and worked as an accountant. He was recruited in 1942 to come do important work "for the government" in Oak Ridge. With pride he served his country supporting the secret work here. His family moved to Knoxville until rental housing became available in Oak Ridge in 1945. When Oak Ridgers were allowed to buy their government-owned-houses in 1957 he bought the home they had rented for twelve years. By 1971-72 health problems forced him to retire shortly before he was sixty-five.

Joe was a professional who worked in Oak Ridge for 30 years. Salaries weren't very high in Oak Ridge when he retired in the early 70's, but he was confident his government would reward his loyalty with a livable pension for him and his wife for as long as they lived. Joe died in 1989 at age 81. His widow receives a surviving spouse pension check and she remains in the house where she has now lived for over sixty two years.

Her pension check in 2005 was $395 each month and $187 of that was withheld to provide health coverage. She received a net of $209 each month from the pension. That and her social security check are how she survives. She provides minimal upkeep on the house, keeps the lights and heat as low as she can stand and doesn't pay anyone to come to clean because she can't afford it. She fell in the Fall of 2006 and broke her hip. After time in the hospital and in rehab, she returned to her home to live alone.

As a ninety-three year old, she wouldn't complain because she grew up during the depression. She loves Oak Ridge, her USA, and the University of Tennessee. She taught school for a number of years when she was younger. Is this how we say, "Thanks for a job well done for DOE contractor retirees and their spouses in Oak Ridge?

In December of 2007, now 94 years old, she fell again at her home and couldn't reach the telephone to call for help. She lay on the floor for two days before someone came and found her. I visited her in early January, 2008 at a health care center. She hopes to be able to return home soon. One of her most pressing concerns is the high cost of care outside her home. How long will she be able to hold on hoping for a pension adjustment that can make her last days more tolerable, at least financially? Should I suggest that she be patient? Should we wait patiently for change?

US Ruling Backs Benefit Cut at 65 in Retiree Plans
By Robert Pear
The New York Times

Thursday 27 December 2007

Washington - 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.

Dianna B. Johnston, a lawyer for the commission, said many employers and labor unions had told it that "if they had to provide identical benefits for retirees under 65 and over 65, they would just drop retiree health benefits altogether for both groups."

In a preamble to the new regulation, published Wednesday in the Federal Register, the commission said, "The final rule is not intended to encourage employers to eliminate any retiree health benefits they may currently provide."

But AARP and other advocates for older Americans attacked the rule. "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 AARP, which represents millions of people age 50 or above and which had sued in an effort to block issuance of the final regulation. "Ten million people could be affected - adversely affected - by the rule."

The new policy creates an explicit exemption from age-discrimination laws for employers that scale back benefits of retirees 65 and over. Mr. Mackaronis asserted that the exemption was "in direct conflict" with the Age Discrimination in Employment Act of 1967.

The commission, by contrast, said that under that law, it could establish "such reasonable exemptions" as it might find "necessary and proper in the public interest." The United States Court of Appeals for the Third Circuit, in Philadelphia, upheld this claim in June, in the case filed by AARP, which has asked the Supreme Court to review the decision.

In its ruling, the appeals court said, "We recognize with some dismay that the proposed exemption may allow employers to reduce health benefits to retirees over the age of 65 while maintaining greater benefits for younger retirees." But the court said the commission had shown that the exemption was "a reasonable, necessary and proper exercise" of its authority.

Under the new rule, employers may, if they choose, provide retiree health benefits "only to those retirees who are not yet eligible for Medicare." Likewise, the rule says, retiree health benefits can be "altered, reduced or eliminated" when a retiree becomes eligible for Medicare.

Further, employers will be able to reduce or eliminate health benefits provided to the spouse or dependents of a retired worker 65 or over, regardless of whether benefits for the retiree are changed.

Employers and some unions contend that retirees under 65 have a greater need for employer-sponsored health benefits because they are generally not Medicare-eligible. Large employers have often provided some health benefits to retirees 65 and older, to help cover costs not paid by Medicare. But employers have for years been trying to reduce retiree benefits or to shift more of the cost to retirees.

Lawyers for the commission said the new Medicare drug benefit, now nearing the end of its second year, had strengthened the case for the regulation because it guaranteed that retirees 65 and older would have access to drug coverage. Younger retirees have no such guarantee, so employers may want to provide drug coverage to them in particular, the lawyers said.

Helen Darling, president of the National Business Group on Health, which represents large employers, welcomed the rule.

"If employers could not coordinate with Medicare, they would be far less likely to provide health coverage" to retirees, Ms. Darling said. "They could not afford to."

A study by the Government Accountability Office in 2001 estimated that one-third of large employers and fewer than one-tenth of small employers offered health benefits to retirees. Ms. Darling said newer retirees often received not comprehensive coverage but instead a fixed amount of money, based on years of service, to help them with their medical costs.

James A. Klein, president of the American Benefits Council, a lobby for large employers, said: "The new rule 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."

Gerald M. Shea, assistant to the president of the A.F.L.-C.I.O., also saw merit in the new rule.

"Given the enormous cost pressures on employer-sponsored health benefits," Mr. Shea said, "we support the flexibility reflected in the rule as a way to maximize our ability to maintain comprehensive coverage for active and retired workers."

Schoolteachers, like many other public employees, often retire early and rely on employer-provided health benefits until they become eligible for Medicare. At a Congressional hearing in 2005, the National Education Association and Representative John A. Boehner of Ohio, who is now the House Republican leader, supported the proposed rule. The teachers union said it feared that employers would cut health benefits for early retirees if they had to provide identical benefits to those over 65 and those under.

As most of you know, the pensions of Oak Ridge contractor employees are reduced by a factor when you take the spousal option. The reduction factor for this option was changed for all active BWXT and ORNL employees effective June 30, 2004.
If you terminated employment on or after June 30, 2004, a factor of .98 will be applied to your life amount to determine your 50% joint and survivor benefit. This is a 2% reduction of benefit.

The reduction factor for all other retirees under the Mult-Employer Pension Plan (the MEPP or BWXT administered plan), are higher and depend on the ages of the retiree and the spouse at retirement. The multiplier to find the pension is given on the BWXT employee benefit website .

The table may be seen at this by clicking here for the file on this site: Spousal Reduction Table. Find your age and your spouses age at retirement, and where the two cross tells you the reduction factor that you are experiencing from the unfair practices of DOE.

Taskel Dishman retired from Y-12 in 1990 after starting there in 1953, and he says:

I'd like to have you consider material I've written up to try to tell people outside our circle how bad we've been cheated. Always when I read people describing the situation, I think to myself: Why don't they mention how long the abuse has continued, and how much the surrounding community has lost over the years. And the people need to know when they are asked to increase local taxes, some of those tax increases don't have to take place if our money is coming to us, thus the community to pay bills and make our entire area a better place to live. I'd like to have you consider the material below for the blog, but if you do, perhaps I need to alter my ID so I'll not make myself open to harassment … after all, I'm an old man of 76 and not able to deal with being cheated monthly and harassed on the net………please let me know your thoughts!

While 12,000 of our nations best and smartest worked night and day to protect you, your children and country, you were paying taxes to support us in our final years of life. Allow me to thank you for the 12,000 abused retired atomic worker families from the plants in Oak Ridge, TN. We were so honored to have had a hand in keeping the people and country safe, only to be scammed in the end:

Over the years, you paid taxes into a fund to help us in our old age and the early contractors did just that and up until about 1990, the retirees got regular cost of living raises. After that a new breed of contractor came onto the scene and those people who worked night and day to keep us and the country safe, have suffered. You the taxpayer was still putting the money, controlled by the contractor, into a fund but it was no longer being paid out as cost of living increased.

What the later years contractors did, was pile the money up in a fund that has grown to more than $3 billion dollars, while we retirees have gotten one half of one cost of living raise in about 17 years. What this means is, when you pay about $3 for gas, we pay the equivalent of about $6. and so it is with every thing we buy because our money has been kept in the account instead of being paid to us for living expense in our final days.

Do the people who are keeping our money from us know how badly were suffering without it? Consider: Months ago they send out offers for a new dental and eye insurance saying, "If your check is not sufficient to pay for the new insurance, you'll be expected to pay the remaining out of pocket!" Did they think we and now you wouldn't ask, if they know our checks are so small/eroded by inflation, where would we get the money to put into that empty pocket … and if the check wouldn't pay for the insurance, how did they think we'd pay other bills for food, housing and energy?

And let me remind you, this sin was going on as our money piled up in the account, growing by about a hundred million dollars a year. It gets worse: During the 17 or so years of our growing personal poverty, the entire area suffered as well. Had they been paying us our money all those years, it would have totaled more than a billion dollars … dollars that when spent and taxed, would have gone directly into the area economy, enriching all the people and all the local governments; some of who say they are so poor, they can't pay their law-enforcement officers properly. Yet, the local leaders who know of the sin/scam have not made an effort to get us and the money into the local economy!

Is it a mystery why they and our local Federal Representatives and Senators have not helped (Sen. Corker has been in office a short time, will you ask him to help; most of us will be dead in another 17 years). Our local Federal Representatives and Senators (we expected Sen. Frist being an MD and one of the most powerful people in the country would understand our suffering, but he never helped … not just a few, he never helped the 12,000 families) have talked a good game, but when members of the House and Senate in Washington, got up bills to help us, our own local members of the House and Senate did not even join with them in those bills to help us!

It is our hope you'll help us by using the many talents God has given you …it may be if you just ask, being who you are, they may realize the cat is out of the bag and everyone in the area and hopefully the country knows about the sin. Unlike other states, this is a one party state and we can beg for help until the cows come home (and we can't afford cows), but they know they can let us suffer until we die and they'll still return to office. And the people left behind, will still not know why they let it happen!

We need someone smarter than ourselves (we've not been smart enough to get our money for the 12,000 abused families) to decide to do that random good deed we read about but seldom see, to lend us just an ounce of their talent. We need you to be that special person who'll write that expose in the fashion of Woodward and Bernstein, or to make that all important call to a connection with an investigative reporter….

And how do you know what I'm telling you is true? You can contact a local writer, Frank Munger (munger@knews.com who writes for the local paper) or the retiree web site, www.corre.info, for the big numbers, but I've tried to break the big numbers down to show who is hurt and how badly. Perhaps we've only told of the big numbers that didn't tell you of the 12,000 families, or the fact that the middle class in the area was being destroyed along with the entire area.

Please forgive my inarticulate writing, but someone has to tell the story and with your help, perhaps it can be shouted from the roof-tops….

According to the local news, Senator Alexander was in town this week for a couple of events:  a ceremony at SNS and a panel discussion at ORAU.  Did he meet with CORRE while he was here?  One would think that he would be interested in the "pension deficit" in Oak Ridge.