GE drops benefits

GE To Drop Post-65 Retiree Health Care Benefits in 2015

General Electric, the nation’s sixth largest corporation, recently stunned many of its retired and soon-to be retired salaried employees by changing eligibility for the company’s post-65 health care and life insurance benefits.

GE announced that recent retirees and employees approaching retirement who were anticipating participation in GE’s post-65 health care benefits program will no longer be eligible unless they reach the age of 65 before January 1, 2015. 

That means many long-service, salaried retirees and employees in their late 50s and early 60s will be cut out of these company-paid benefits which supplement Medicare’s coverage for hospitalization, physician care and prescription drugs in their retirement years. The GE announcement was made in late September, just 27 months before the new policy goes into effect.  Coverage for dependent spouses is also affected by the announcement.

GE also announced that salaried employees retiring after January 1, 2015 will not be eligible for company-provided retiree life insurance benefits.

The reaction from GE employees and retirees was swift and ranged from surprise to disappointment to anger. One retiree, Paul Hammons, retired NBC News producer noted that the company’s credibility and integrity are on the line. “GE believes that they have the legal right to cancel this coverage. Apparently promises made over the years mean nothing. I insist that GE has a moral imperative, an integrity-based responsibility as well as a legal obligation to keep all covenants to both groups and individual employees."  

"I never thought GE would do something like this. I am shocked. We believed there was a culture of integrity. It is simply wrong to sock it to good people who have earned these benefits over their careers and counted on that company to fulfill its commitments."   Jack Batty, retired GE company spokesperson and former executive director of GE's volunteer service organization.

“GE does not take decisions such as this one lightly.  As is the case with other employers, we are taking these actions to remain competitive now and in the future,” said Andrea Doane, a GE spokeswoman, “The timing of this announcement is intended to allow affected individuals an opportunity to evaluate the changes and select alternative coverage if they choose.”

The 121-year-old blue chip company was once a pioneer in pension and health-care benefits. GE market capitalization ranks sixth among U.S. companies.