Vanishing retiree health care benefits
By Carole Moore • Bankrate.com

As the first wave of baby boomers makes the transition from career track to riding the retirement rails, here's a warning from those who've already pushed off from corporate life: Don't believe everything you're told, even if you have it in writing, especially where post-retirement health insurance is concerned.

The light at the end of the retirement tunnel may be an oncoming train, after all. From corporate penthouses to state legislatures, a move to cut and, in some cases, eliminate retiree medical benefits altogether has caught hold. It's leaving upcoming retirees with a dilemma many don't even realize they're facing -- how are they going to pay for future medical needs not covered by health insurance or Medicare? For many, the answer will redefine their retirement.

Health care costs Have retiree health benefits? Read the fine print. Your best-laid plans could derail.

Promises, promises 1. Benefits slip through fingers 2. The decline of retiree health benefits 3. Health insurance backstops 4. Government workers not immune

Benefits slip through fingers
Ron Harper started working for Allstate Insurance Co. in 1989 after 22 years in the grocery business. As a representative of the insurance giant, Harper had an enviable future retirement with a 401(k), generous pension program and health insurance for himself and his wife. But when the company restructured its employment policies, Harper and more than 6,000 fellow agents found most of their benefits had slipped through their fingers.

Although he still sold Allstate Insurance, he was no longer considered a company employee. Instead, he and the others were reclassified as "independent agents," and they lost their company pension plan and post-retirement medical insurance benefits. Now Harper, who once paid $130 a month for family medical insurance coverage, has a self-paid policy with a whopping $5,450 deductible, supplemented by a health savings account he has established.

When, for example, Harper's wife underwent a recent colonoscopy, it cost the couple about $3,000 out of pocket. Harper observes that one downside to losing medical coverage is that many don't have the money to pay for preventive health care, so it falls by the wayside.

Now 55, the Thomson, Ga., resident publishes a newsletter for Allstate agents and is one of more than 6,000 plaintiffs in an unresolved lawsuit against the company.

Harper says his medical insurance premiums run him about $500 a month, with another $500 going into his medical savings account. "I don't see how I can ever retire," he says.