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September 08, 2013 at 05:46 PM
Media and entertainment company Time Warner Inc. plans to move its retired workers off its health plan and provide money to them to buy coverage on private exchanges at the beginning of next year.
Company spokesman Keith Cocozza confirmed the plan Sunday.
The move, which was earlier reported by Reuters, is similar to a “defined contribution” retiree health benefits change confirmed by IBM on Saturday.
Both companies plan to allocate money to special accounts for retirees, which the retirees can use in purchasing coverage.
Other large employers are also moving away from retiree health benefits. American Airlines parent AMR Corp., for example, is seeking approval for the change from a federal bankruptcy court judge.
A Kaiser Family Foundation report issued last month found that among companies with at least 200 workers, 28 percent that provide health benefits also offer retiree coverage.
The study’s authors said few large employers have turned over benefits for workers or retirees to private exchanges but that 29 percent of companies with at least 5,000 workers are considering an exchange-based strategy.
The authors said there could be “a significant change in the way that employers approach health benefits and the way employees get coverage, with employers playing a less active role.”
