The Spark

“The emancipation of the working class will only be achieved by the working class itself.” — Karl Marx

Detroit Retiree Health Care:
Going, Going...

Feb 3, 2014

Emergency Manager Kevyn Orr reached a settlement with a committee set up to represent retired Detroit city workers in negotiations on cuts to retiree health care benefits. The deal, though better than what Orr proposed last year, is still a huge attack.

Under the settlement, retirees under 65 will receive $175 to buy health care coverage from the federal government’s new Health Insurance Marketplace. That’s a whole $50 increase from what Orr initially proposed, but it still leaves the retirees facing additional premiums and out-of-pocket expenses.

Retirees over 65 will get city-sponsored Medicare Advantage plans. Those plans do not provide supplemental insurance, which they will have to purchase themselves or be left with high out-of-pocket expenses.

This settlement only covers retiree health care for 2014. Orr’s proposed plan for settling the city’s bankruptcy includes a proposal to dump health care for the current city retirees by putting money into a VEBA, with the possibility that the VEBA could eventually run out of money and leave city retirees empty-handed – as auto workers know all too well!

It’s all just one more way the officials are stealing from city retirees to hand over more to wealthy bondholders.