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Employer-Sponsored Health and Retirement Benefits: Efforts to Control Employer Costs and the Implications for Workers

GAO-07-355 Published: Mar 30, 2007. Publicly Released: Apr 30, 2007.
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Highlights

Many U.S. workers receive health and pension benefits from employers, and the cost of these benefits represents a growing share of workers' total compensation. Employers have made changes to control these rising costs, contending that these changes will allow them to remain competitive, particularly in an increasingly global market. Some advocacy groups are concerned that workers may receive reduced benefits or incur additional costs as a result of employers' cost-control strategies. Moreover, they contend that these changes may disadvantage certain groups of workers, such as sicker, older, or low-wage workers. GAO was asked to examine the practices employers are using to control the costs of benefits. To evaluate changing employer benefit practices and their potential implications, GAO examined: (1) current and emerging practices employers are using to control the costs of health care benefits; (2) current and emerging practices employers are using to control the costs of retirement benefits; and (3) employers' workforce restructuring changes. GAO reviewed studies of employer benefit trends; interviewed representatives of business, government, labor, and consumer advocacy and research organizations; and reviewed and analyzed data from surveys of employee benefits. The Department of Labor provided technical comments, which were incorporated as appropriate.

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CompensationCost analysisEmployee benefit plansEmployee medical benefitsEmployee retirement plansEmployeesHealth care cost controlPrivate sector practicesRetirement benefitsHealth benefits