IBM drops medical coverage for 110,000 as Obamacare looms
Company cites rising healthcare costs as reason.
Obamacare is supposed to make insurance affordable for many people, but it's just not happening. For 110,000 IBM retirees, they're about to join the Obamacare market. Citing the rising cost of healthcare, IBM has said it will move the retirees to the private market, and off their current plans with the company.
Now, when retirees become eligible for Medicare, they will be required to move to that system. IBM will still provide an annual payment to facilitate their move. Those payments will be less than the cost of providing coverage under the preexisting plan.
This will also make employees responsible for their own care, under the Medicare or Obamacare systems. Money from IBM will help them to cover gaps in Medicare coverage by purchasing additional coverage on their own.
The latest move by IBM isn't particularly rare as companies seek to insulate them from cost increases and compulsory coverage forced by Obamacare. Since individuals can now obtain insurance on their own, many are being left to do so. The era where employers provide the healthcare may be drawing to a close.
Low-paid employees who work for small hourly wages have already been hit hard by the coming of Obamacare. Many workers have seen their hours cut which directly affects the size of their paychecks. Some are now working part-time and multiple jobs, just to earn what they earned before and so they can afford to pay for their own healthcare starting in 2014.
Although these same low-wage earners also have subsidies from Obamacare, their healthcare comes at a cost few can afford. It is projected that many Americans will simply pay the penalty tax rather than pay even more for healthcare coverage under Obamacare.
The situation is a difficult one. We have a rising attitude in business that directors must maximize shareholder profits, that this is their fiduciary responsibility, and if they accomplish this there will be generous payouts to CEOs and others at the top. There is then an attitude that praises financial earnings over the well-being of the employees who are largely left to fend for themselves.
This is happening at a time when education is becoming unaffordable and the degrees students are earning are becoming less useful. The nation is seeing a rise in prosperity for the wealthy and a general decline for the masses.
This is a bad recipe because it removes moral responsibility from the employer, who treats people as disposable resources and as engines for profit. People become things -numbers on a spreadsheet as opposed to humans.
The future portends a time of upheaval where either an overreaching government steps in to provide people with basic needs, such as healthcare, or the people demand change via dramatic shifts in national policy. Only in the short term then, is the reckless pursuit of corporate profits sustainable.
IBM cannot be blamed for casting off its retirees amid a climate of government interference and skyrocketing costs. Nor can we expect other corporations and employers to break their banks for their employees. However, a new balance must be found. People have basic needs that must be met. Unfortunately, between government interference and corporate greed out of control, individual finances, for both retirees and the poor, will be stretched to breaking. When that happens, expect change to come not by election, but by hammer.
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