<nobr>Mar 25, 2008</nobr>

Supreme Court Lets Stand Decision Allowing Employers to Coordinate Retiree Health Benefits with Medicare

In a major victory for ERIC and major employers, the Supreme Court on Monday (March 24) let stand the Equal Employment Opportunity Commission's (EEOC) exemption to the Age Discrimination in Employment Act (ADEA), allowing employers to reduce or eliminate health benefits of retirees when they become eligible for Medicare.

The Supreme Court's decision will finally put the issue to rest after several years of litigation brought by AARP against the EEOC. EEOC in December 2007 formally and finally announced its exemption to the ADEA.

ERIC spent several years lobbying EEOC to make use of its exemption authority and Congress in defense of that authority. ERIC also filed several amicus briefs defending the agency's authority to issue the exemption during the extensive litigation.

The rule holds that employers may provide retiree health benefits to only those retirees who are not yet eligible for Medicare, and that when a retiree becomes eligible for Medicare their health benefits plan can be altered, reduced, or eliminated by their employer.

For additional information on ERIC's efforts regarding the issue, refer to the Age Discrimination and Erie/ADEA Briefing Books.

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For additional information:
Ted Godbout
Manager, Communications
The ERISA Industry Committee
1400 L Street, NW, Suite 350
Washington, DC 20005
Phone: (202) 789-1400
Fax: (202) 789-1120
E-mail: tgodbout@eric.org
www.eric.org

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