March 3, 2005
Retiree Health Benefits
We previously alerted you that in April, 2004, the EEOC voted to make final regulations proposed in 2003 that permit employers to reduce, change, or eliminate retiree health benefits when the retirees become eligible for Medicare.
NOTE: Many programs already treat persons differently once they reach age 65. However, the legality of such differential treatment has not been clear.
Despite the EEOC’s approval of the regulations, they do not actually become “final” until published in the Federal Register.
AARP has sued the EEOC to prevent publication, and therefore implementation of the new regulations. AARP takes the position that the EEOC acted illegally by creating an exemption to the ADEA permitting employers to reduce or eliminate health insurance benefits for retirees age 65 and over. In response to the lawsuit, the EEOC has agreed that it will not publish the regulations before April 5, 2005.