Administration January 8, 2003

Lincoln Buys RK Firm

August 13, 2002 (PLANSPONSOR.com) - Lincoln Financial Group will acquire The Administrative Management Group, Inc., an employee benefits recordkeeping firm.
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AMG has been a partner of Lincoln’s for almost four years providing recordkeeping services for the Lincoln Alliance Program.  The acquisition of the Arlington Heights, Illinois-based recordkeeper is expected to close in the next 30 days.

According to Lincoln, plan sponsors and their consultants have increasingly demanded that external plan administrators like Lincoln Retirement Services own and control the recordkeeping and reporting function, in addition to providing investment options, education and counseling to employees who participate in the benefits plans.  Bob Bond, CEO of Lincoln Retirement Services said yesterday that “when we would lose cases and get feedback on the decision, the number one issue was that we didn’t own the recordkeeping company. Now we do.” 

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According to a Lincoln media release, the final purchase price will be based on future results and will not go over $37 million.

Launched in early 1999, the Lincoln Alliance Program provides turnkey solutions for employer retirement and employee benefit programs, including investment choices, recordkeeping, plan design, compliance and employee retirement counseling and education.

Lincoln Financial Group has total retirement assets of more than $54 billion.

Benefits January 7, 2003

GE Workers Threaten Strike over Health Care Costs

January 7, 2003 (PLANSPONSOR.com) - In response to rising health care costs, 14,000 members of General Electric's (GE) International Union of Electronic, Electrical, Salaried, Machine and Furniture Workers-Communications Workers of America (IUE-CWA) union will go on strike just after midnight on Tuesday, January 14, according to a press release.
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The strike, set to last until midnight January 15, is due to GE’s increase of health care co-pays for workers and pre-65 retirees in its managed care plan.   Additionally, the union said the strike is intended to serve as a deterrent to GE’s stated plan to seek “substantial” increases when national union negotiations start in May 2003.

According to the release, from 2000 to 2001, GE’s costs in its managed care plan increased by 9.7%, while workers’ co-premium costs jumped 16.0%. In a single year, GE will have shifted $43 million to $57 million in costs onto workers and retirees. At the same time, GE’s total health care costs, as a percentage of profit, were lower in 2001 than in 1999. The union said this translated into nearly 145,000 families being hit with the cost hikes January 1.

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The strike will impact 48 locations in 23 states working in GE’s appliance, lighting, power systems, aircraft engine, consumer and industrial repair, industrial systems, plastics and transportation businesses.

“IUE-CWA is taking on the fight for affordable health care for all GE workers, including unrepresented workers,” said IUE-CWA President Edward Fire. “GE has provoked a strike through its greed. A company that sets record profits each year, $14.1 billion in 2001, can afford to maintain health benefits without forcing workers and retirees to pay more.”

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