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Benefits January 12, 2012
Retiree Health Benefit Offerings Continue to Tick Down
January 12, 2012 (PLANSPONSOR.com) - The Benefits USA 2011/2012 survey results found 21.9% of companies offer supplemental retiree health coverage to retired employees.
Reported by Rebecca Moore
That’s a slight dip from 22.9% reported in 2006. Employees are required to work an average of 12 years for their employer in order to qualify to receive this benefit upon retirement.
The offering of retiree health benefits varies widely by industry as 69.1% of companies in utilities offer them. Not-for-profit and banking and finance organizations offer retiree health benefits at a rate of 37.6% and 31.5%, respectively. Companies in healthcare offer the benefit at a rate of 15.8%, while hospitality employers offer it the least, 3.3%.
On average, retirees are required to pay 65.1% of the premium for their retiree health benefits.
“Escalating medical coverage costs, combined with a rapidly increasing retiree population and longer life expectancies may make it difficult for companies to sustain these benefits indefinitely.” said Amy Kaminski, director of marketing for Compdata Surveys.
Information for the survey was collected from nearly 4,500 benefit plans covering over six million employees across the country.