Wednesday, March 05, 2008 Health
Care Marketplace
Federal Judge Grants Preliminary Approval of
Agreement by GM, UAW To Establish Health Benefit Trust
A federal judge on Tuesday granted
preliminary approval of an agreement between General Motors and the United Auto Workers that would establish a health benefit
trust for union retirees called a voluntary employees' beneficiary
association, the AP/Houston Chronicle reports. U.S. District
Judge Robert Cleland praised GM and UAW for their cooperation on the
agreement.
Under the agreement, part of the contract negotiated
last year, GM would contribute between $33 billion and $36.5 billion to
the VEBA, which will reduce retiree health benefit liabilities for the
company by about $46.7 billion. The VEBA would become operational as early
as Jan. 1, 2010, and would cover about 500,000 GM retirees and their
spouses. An 11-member committee would manage the VEBA, with five members
selected by UAW and six members appointed by the court. Health benefits
for UAW retirees would remain unchanged through 2011, at which time the
committee would have the authority to regulate them.
GM retirees
and employees affected by the agreement will receive information on the
VEBA by March 28, and Cleland will hold a hearing to consider the fairness
of the agreement on June 3 (AP/Houston Chronicle, 3/5).