"Under the New Agreement, Chrysler's Retired Hourly Workers Will Also Face New Co-payments and Deductibles."
Well, that's what happens when your employer pays you 80 cents on the dollar for your health care, and says here, you guys sort it out. The Detroit News reports that U.S. District Court Judge Robert Cleland considers Chrysler's $10.3b health care compact with its United Auto Workers (UAW) members "fair and reasonable." Under the terms of the agreement (a.k.a. health care VEBA), 170k active Chrysler workers, retirees, spouses and dependents will face new charges for their doctors' visits. In the short term, Chrysler retirees will now pay an $11 monthly premium and a $159 annual deductible. After that, a new 11-member supervisory board (six court appointees, five union reps) will ensure that the fund makes up the $8b shortfall AND makes enough money to cover soaring health care cost inflation, WITHOUT raising deductibles or further limiting patient choice OR allowing union members to plunder the fund OR letting cronies (lawyers, hospitals, etc.) get sweetheart deals OR waste precious VEBA funds. Meanwhile, Chrysler's lawyer says the VEBA's a good deal because her employer might go out of business. "We do believe in the light of the uncertain environment that Chrysler is operating that this settlement is the best for all parties," Nancy Ross pronounced. Ready for that summer vacation yet Nance?
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Oh my god. Employees, retirees, and a union having to take responsibility for something. No more free and unlimited health care? My sympathy factor is... zero.
The article says Chrysler is supposed to toss $10.3 billion into the trust and that "The three automakers have a combined $86 billion in retiree health care liabilities on their books that would be taken over by their trusts as of 2010." Gee, are C/F/GM generating enough surplus cash to cover that liability by 2010? I thought they were having trouble making a profit. Ahah! Turns out they're making money hand over fist. Worried UAW retirees will be comforted by this disclosure in a Detnews reader's comment on the article: "I've worked along side Chrysler union people in manufacturing plants here in Detroit while in college and now a 94 level Management employee in Auburn hills; sales, marketing advertising division. ...Chrysler makes $10.500 profit on average for every vehicle produced; I've seen the internal figures/documents.
The VEBA setup is simply the unions deciding that 60% of promised health benefits is better that the zero percent they would get from a company gone into Chapter 7 liquidation. A reasonable decision, I think. That 60% is not going to cover a gold-plated health plan.
Mikey, I hope this makes all you guys realize that union promises (just like management and government promises) aren't usually worth much. Apparently, the contract was flawed. Of course, you could have your own contract, but not in a union. You could sue individually, but not in a union. Etc. Collectives are a bitch, aren't they? So the question then becomes - should we make our entire country more, or less like Detroit? Maybe you should bring that up in the next UAW meeting where they discuss how they are using your money to try to do EXACTLY that with out country.