GM to Offer Only CDHPs to Salaried Staff

October 23, 2009 ( - Starting January 1, 2010, General Motors Co. will offer only high-deductible consumer-driven health plans (CDHPs) to its 24,000 salaried employees.

Business Insurance reports that GM salaried employees will choose from two plans, both linked to health savings accounts.

GM will contribute $1,300 to employees’ HSAs, which is intended to help employees pay for uncovered health care expenses and to help them accumulate funds to pay for health care expenses after they retire, a GM spokeswoman said, according to Business Insurance. GM salaried employees hired after 1993 are not eligible for retiree health care coverage.

The change is to better control costs, while still offering a competitive health care benefits program, the spokeswoman said.

Under one plan, the deductible will be $1,300 for single coverage and $3,100 for family coverage, with a maximum annual out-of-pocket expense of $2,200 for those with single coverage and $5,000 for family coverage. Employees will pay monthly premiums ranging from $5 for those with single coverage and $15 for those with family coverage.

In the other plan, deductibles also will range from $1,300 to $3,100, but GM will cover all eligible in-network expenses after the deductibles are met, and monthly premiums will range from $25 for individual coverage to $75 for those with family coverage.

In other cost-cutting measures, according to Business Insurance, on January 1, 2009, it eliminated health care coverage for salaried retirees eligible for Medicare, while in 2010 it is trimming health care coverage for salaried pre-Medicare eligible retirees. On July 1, 2009, it eliminated vision and dental care benefits for UAW-represented retirees.

The biggest benefit change came in a 2007 agreement with the United Auto Workers that ended GM’s commitment to provide retiree health care benefits to UAW-represented members, effective Jan. 1. In 2008, GM valued that liability at $50 billion.

In 2007, GM and the UAW reached an agreement that transferred responsibility for retiree health care benefits of union employees to a Voluntary Employees Beneficiary Association (VEBA) trust administered by the union (see GM and UAW Agree to Retiree Health Care Trust ).