Employee Benefits:

Financing Health Benefits of Coal Industry Retirees

HRD-92-137FS: Published: Jul 22, 1992. Publicly Released: Jul 22, 1992.

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Pursuant to a congressional request, GAO provided information regarding proposed legislation for coal industry retirees' health benefits and existing pension trusts, focusing on: (1) the characteristics of the trusts' beneficiaries, (2) the benefits provided, and (3) the present and projected financial condition of the trusts.

GAO found that: (1) there were deficits in the industry's pension and benefits trusts, which result in increased contribution rates and could reduce access to benefits; (2) there were over 116,000 beneficiaries enrolled in the trusts; (3) many of the beneficiaries' employers are either no longer in business, their business status is not known, or the company is unidentifiable; (4) the trusts provide inpatient and outpatient hospital benefits, primary care benefits including a $5 copayment for physicians visits up to $100 per year, low prescription drug copayment benefits, and other specialized benefits; (5) reenrollment and recertification would not identify a significant number of ineligible beneficiaries; (6) health benefits for beneficiaries' children ends at 22 years of age; and (7) the funding formula for the trusts is based on the employee's work hours, with additional contributions coming from employers through coal tonnage purchases from other operators.

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