- The Washington Times - Thursday, February 20, 2003

DETROIT, Miss., Feb. 20 (UPI) — Ford Motor Co. said Thursday it will be sharing health care cost increases with employees, beginning June 1.

The world's No. 2 automaker, which has lost $6.4 billion in the last two years, told employees by e-mail and letter this week it still will pick up 90 percent of costs but that will mean premiums and/or co-payments will increase.

"Health care costs are accelerating at a high rate and it's a national problem," Ford spokesman John Harmon told Thursday's Detroit News. "That's the underlying cause of this action. Both the company and its employees and retirees have to share the burden of these increases."

Last summer, Ford began charging its 50,000 white-collar employees a $16 to $150 monthly premium and in January General Motors imposed premiums of as much as $51 on 160,000 salaried retirees who previously had paid little or nothing.

The changes do not affect retired hourly employees whose coverage is governed by contracts with the United Auto Workers but the issue is expected to dominate contract talks between the UAW and the Big Three automakers slated to begin this summer.

The issue of health care costs is not unique to the auto industry. General Electric Co. workers staged a brief strike over the issue earlier this year and other unionized workers have been threatening similar actions.

Surveys indicate 75 percent of U.S. employers have boosted deductibles and out-of-pocket payments in the past two years.

The size of the Ford increase will depend on the specific health care plan and the number of dependents covered. Premiums for health maintenance organizations are expected to go up 15 percent. The company also is tightening eligibility rules for dependents.



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