$1.8 Billion in Taxpayer Funds Going to Corporations, States and Unions to Help Them Pay for Healthcare Benefits for Early Retirees

Another Perk of Health-Care Law: Reimbursements for Unions, States, Corporations

April 1, 2011

FOXBusiness - In a little-publicized report on a little-known provision in the health-care law, the administration detailed $1.8 billion in reimbursements to corporations, unions, state and local governments and religious organizations to help them pay for health-care benefits.

The law established the Early Retiree Reinsurance Program.

It provides up to $5 billion for “employers to help them maintain coverage for early retirees age 55 and older who are not yet eligible for Medicare,” according to an administration fact sheet.

Its funding is designed to last until 2014, when the bulk of the health-care law’s benefits begin. Less than a year after becoming law, the program has already spent more than a third of that money.

The program has reimbursed about $1 billion combined to the states of Michigan, Texas, New Jersey, Ohio and California. It reimbursed Verizon (VZ: 38.60, +0.12, +0.32%) nearly $92 million, General Electric (GE: 20.57, +0.23, +1.13%) more than $36 million and General Motors (GM: 32.37, -0.04, -0.12%) $19 million. The United Auto Workers received more than $206 million. Other unions benefited in the tens of millions each.

“The availability of group health insurance coverage for America’s retirees age 55 to 64 has declined significantly over the past 20 years, as the percentage of large firms providing workers with retirement health coverage has dropped from 66 percent to 28 percent,” said the administration’s report. “The (program) was designed to stabilize this market by providing financial assistance to health plan sponsors that make coverage available to millions of early retirees and their families.”

Opponents of the program said the reimbursements amount to bailouts for companies and unions that have already negotiated and agreed to these benefits.

The House Energy and Commerce Committee is examining the program. Chairman Cliff Stearns (R-FL) of the Oversight and Investigations Subcommittee said to FOX Business:

“It’s taxpayer money that is not paid for …to GE, Citicorp, AT&T, large corporations like that who are making billions in profit, just seems obscene frankly.”

“While some large plans received significant amounts from the program, most of the individual (program’s) reimbursement payments made in 2010 were for less than a $1 million,” said the report. “The sponsors that received some of the largest reimbursement amounts in 2010 report that program payments will benefit, either directly or indirectly, more than 4.5 million retirees” and their families.

View the full report here.

Sampling of Recipients:

States
Michigan $319,806,424
Texas $276,245,149
New Jersey $158,830,329
Ohio $123,187,291
California $111,721,133
Illinois $102,556,381
New York $104,402,728

Companies
Verizon Communications Inc. $91,702,538
General Electric Company $36,607,818
General Motors, LLC $19,002,669
The Boeing Company $18,759,499
International Business Machines Corporation ("IBM") $12,989,690
EI duPont de Nemours and Company $12,796,589
United Parcel Service of America, Inc. $12,312,873
Deere & Company $8,699,250
Exelon Corporation $7,582,887
Ford Motor Company $7,124,437
The Procter & Gamble Company $6,597,553
United Airlines, Inc. $5,868,926
Mars, Inc. $3,453,868
Chrysler Group, LLC $3,264,964

Union/Retiree Plans
United Auto Workers $206,798,086
Public Employees Retirement System of Ohio $70,557,76
Teacher Retirement System of Texas $68,074,118
California Public Employees' Retirement System (CalPERS) $57,834,267
Employees Retirement System of Texas $30,175,627
State of Michigan Public School Employees Retirement System $22,620,604
State Teachers Retirement System of Ohio $20,334,357
National Carriers' Conference Committee $14,161,277
Oregon Educators Benefit Board $8,440,167
Public Employees' Retirement Association of Colorado $8,101,677
Public School Teachers $5,465,564

Governments
Georgia Department of Community Health $57,936,127
State of New York $47,869,044
Commonwealth of Kentucky $29,666,51
South Carolina Budget & Control Board $27,142,502
Commonwealth of Pennsylvania $24,522,631
State of Michigan $20,247,338
New Mexico Retiree Health Care Authority $5,915,300
City & County of San Francisco $3,692,576

Banks
Wells Fargo & Company $3,318,769
JPMorgan Chase & Co. $2,922,102
Bank of America Corporation $2,324,163
Citigroup, Inc. $1,767,406

Foreign Companies US Operations
Alcatel-Lucent USA, Inc. $12,512,340
BP Corporation North America, Inc. $5,316,60
Valero Energy Corporation $1,064,122
Nissan North America, Inc. $1,011,690
ThyssenKrupp Waupaca, Inc. $383,103
Astrazeneca Pharmaceuticals, LP $339,453
Ericsson, Inc, $197,168
Thomson Reuters Holdings $161,981
Mercedes-Benz U.S. International, Inc. $17,572

$5 Billion Subsidy for Early Retiree Health Coverage Going Quickly, Drawing GOP Criticism

April 2, 2011

newsfeedresearcher.com - ...How do you tell if a $5 billion federal program is a success? If you''re in charge of ObamaCare's Early Retiree Reinsurance Program (ERRP) — a slush fund that has already approved grants worth tens of millions of taxpayer dollars to state governments, unions, and big corporations — success means giving away so much money so fast that you have to shut the program down early.

Much of the money has gone to some big-name companies and organizations, including more than $200 million for the United Auto Workers, $140 million for ATT and $91.7 million for Verizon. General Electric, which made news this week for not owing federal taxes on $14.2 billion in profit, got $36.6 million through the retiree program.

"How can you justify giving out so much of taxpayers' money to these profitable corporations?" Florida Rep. Cliff Stearns said at a legislative committee hearing Friday in questioning Steve Larsen, a senior director at the Centers for Medicare Services, which runs the program.

Larsen replied that the program enabled those companies to continue to offer retirement benefits.

Of the $1.8 billion distributed, $206.8 million, or more than 10%, was distributed to the United Auto Workers Retiree Medical Benefits Trust...