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USA: General Motors salaried workers and retirees expect health care cost hike

By just-auto.com editorial team | 4 October 2005

General Motors salaried workers and retirees are bracing for a new increase in their 2006 health insurance premiums, as the automaker tries to cut costs, a Detroit News report said.

Several retired GM salaried workers told the paper that the monthly premiums they pay for medical and dental benefits are set to increase by about 25%, according to an internal web site accessible by employees and retirees.

The paper noted that word of the increases comes as GM prepares to enrol employees in health plans for next year from October 19.

GM spokeswoman Sharon Baldwin told the Detroit News the company is working to establish employee health care costs for 2006 but the company is not distributing that information to all salaried workers and retirees yet.

It appears that some workers and retirees were able to access information about their health care plans earlier than GM intended, the report added, noting that the automaker's health coverage is still better than average.

GM told the paper that its salaried workers pay 27% of their total health care costs on average while the company's UAW-covered hourly workers pay 7% - the average US corporate employee pays 32%.

GM estimates its health care costs for about 1.1 million people will swell to $5.6 billion this year, up from $5.2 billion in 2004, making it  the largest provider of health care coverage for employees in the world, the Detroit News report said.