VIAGRA NEWS

Source: DetNews.com

Date: 1-Jan-2008

Author: Sofia Kosmetatos

General Motors Corp. salaried retirees will shoulder much more of their health care costs in 2008, a result of money-saving measures the company announced in 2006.

The increases in deductibles, out-of-pocket maximums, co-payments and premiums will pay for costs that exceed a payment cap the automaker set in 2006 on its salaried retiree health care tab. The cap sets GM's annual liability for this group's benefits at the level it paid in 2006. As health costs rise, salaried retirees will continue to pay more for their health care to make up the difference.

Capping payments was GM's answer to a challenge faced by other automakers and companies across all industries as health costs continue to rise. Many companies are passing along at least some of the increases to employees. However, autoworkers -- who traditionally have enjoyed more generous health benefits then most other employees -- haven't been spared, as the automakers struggle with enormous health care burdens.

The increases to salaried retiree health care costs this year will help GM make up the difference -- some $45 million -- between actual health care costs in 2007 and the cap, said GM spokeswoman Michelle Bunker.

GM spent $3.3 billion for retiree health care in 2006, a tab it doesn't break down by salaried or hourly status. The company has 432,000 retirees, of which 100,000 are salaried.

The increases vary depending on the type of plan. But for most salaried retirees covered with an Enhanced PPO plan, the changes will mean:

• Plan deductibles will increase from $500 to $750 for an individual and from $1,000 to $1,500 for a family.

• Prescription co-pays for generic drugs will double from $5 to $10 for a drug filled at a retail location and from $10 to $20 for a drug ordered through the mail.

• Out-of-pocket maximums will rise from $1,500 to $2,000 for an individual and from $3,000 to $4,000 for a family.

Co-pays for preferred and nonpreferred drugs also will increase, and for the first time, the automaker will require retirees taking certain drugs to pay a co-pay higher than the one it has set for nonpreferred brand name medications.

These drugs, usually injectable medications, will cost $75 at a retail location and $150 via mail, versus the $50 retail and $100 mail order cost for nonpreferred, third-tier drugs.

The higher prescription co-pay is still far lower than the thousands of dollars many of these drugs cost, Bunker said, and is necessary for the company to continue to offer coverage for drugs that many people need. The increase will affect people being treated for conditions ranging from asthma to cancer to rheumatoid arthritis.

GM also will end coverage of erectile dysfunction medications like Viagra and Cialis. The move follows Ford Motor Co.'s announcement in 2006 that it, too, would end partial coverage of those drugs.

The changes aren't sitting well with some retirees, who feel "cast adrift," said Richard Dreist, 67, who retired from GM in 1992 after 30 1/2 years.

"From the retirees' point of view, it doesn't seem like a very loyal program," said Dee Edington, director of the Health Management Research Center, at the University of Michigan. "On the other hand, it is a trend that GM is following."

Dreist is appealing GM's decision to cut coverage for Cialis, a drug he takes following a bout with prostate cancer. "It's a quality of life issue," he said.

Seeking additional ways to cut costs, GM also will limit coverage for retirees who are eligible but do not enroll for Medicare Part B. GM will only pay the amount Medicare would pay for care covered under Part B -- such as durable medical equipment -- leaving the retiree responsible for the rest of the bill.

However, there is one bright spot for salaried retirees next year. GM will extend the number of days for which salaried retirees can get prescriptions filled at a retail pharmacy, from 21-30 days at a time.

"It really irritated people that they could only get three weeks at a time," Bunker said. "Retirees should be happy about that."

Chrysler retirees hit

Nonunion represented retirees at Chrysler also will face increases in health care costs in 2008.

Those under 65 years old will see in-network PPO deductibles increase $100 for an individual and $200 for a couple, said spokesman Dave Elshoff. Out-of-network deductibles will increase by $200 and $400, respectively. In 2007, Chrysler made premium increases incremental depending on the retirees' exit salary. Chrysler replaced company health insurance for Medicare-eligible nonunion represented retirees and spouses with a $1,750 annual account in 2007. That amount will increase 3 percent for retirees, but not their spouses, in 2008.

Chrysler has 19,300 nonunion represented retirees.

Ford Motor Co. eliminated company health insurance for Medicare-eligible retirees and spouses beginning this year. Retirees and their spouses who are 65 years old will each get $1,800 annually in a health reimbursement arrangement that can be used to pay for Medicare coverage and other health costs. The changes were part of a sweeping round of benefit cuts designed to save millions of dollars.

Ford spent $3.1 billion on health care for 570,000 U.S. employees, retirees and dependents in 2006, of which $1.8 billion was for retiree health care.

The company won't release information on benefit plan changes for salaried retirees under 65 for a few months, since the benefit year runs from June 1 to May 31, said spokeswoman Marcey Evans.