Some questions that were answered at the meeting include:
• Will federal health care reform cause VEBA members to be taxed on their benefits? The reform should have no impact on the fund. Since it only includes retirees, and it does not qualify as a “Cadillac plan” it should be exempted.
• Are dependents over age 21 covered? Yes, but members must submit proof that the dependent is a student for that person to remain on the plan.
• What will happen to VEBA funds after the last retiree in the plan dies? The courts would decide how those funds would be distributed.
• Can trustees of the VEBA be changed? Yes, those interested can submit their name to the Concerned Armco/AK Steel Retired Employees advisory committee for consideration. Trustees ultimately decide if members should be re-elected after their term expires.
• If prescription co-pays are $10, who pays the remaining balance for a drug? The fund picks up the difference.
• Do members have to join Medicare Part B? Yes, once over the age of 65 retirees must pay for the Part B plan, which will be reimbursed through the VEBA. Otherwise, members will only receive 20 percent payment for their medical costs.
MIDDLETOWN — More than 100 retirees from Armco and AK Steel expressed concerns regarding health care benefits Wednesday, July 14, at the VFW on Coles Road.
The meeting was meant to discuss the status of the Voluntary Employees Beneficiary Association, or VEBA, which pays for health care benefits for about 7,000 members. Of those, about 4,000 are over the age of 65.
Trustees of the fund said the balance of the VEBA has taken a hit as a result of the financial downturn. About $519 million was in the fund as of the end of May. Most of the funds are invested in a Russell 3000 index fund and various bonds. Officials told retirees at the meeting about $30 million to $40 million has been expended from the VEBA each year to pay for medical benefits.
“It’s going to be going down regardless and our job is to manage it so it doesn’t go down too fast,” said Jay Youngdahl, a professional trustee of the VEBA.
Retirees will receive a 2009 audit report on the VEBA in the mail in a few weeks, trustees said.
The VEBA was established as a result of a settlement agreement with AK Steel and Armco/AK retirees following a lawsuit filed in July 2006. AK Steel agreed as part of the settlement to contribute $663 million to the VEBA over a four-year period. The steelmaker is due to make its last $65 million payment in March 2011.
Retirees with further questions and concerns can speak to representatives at the VEBA fund office located at Midfirst Credit Union, 1201 Crawford St., Middletown.
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