The announcement came after the company reached a settlement agreement with a designated retiree committee that was formed after National Steel filed for bankruptcy on July 10, 2003. National Steel said providing employer-sponsored medical coverage at reduced costs met most of the committee’s concerns about affordable, continuing medical coverage, including prescription drugs, with no pre-existing condition limitations, according to news sources.
“Offering a choice of alternatives permits those retirees most in need of their current benefit level to elect to continue it for a period of time, while presenting a more affordable option with reduced benefits to those retirees unable to afford continuing their present level of benefits,” retiree committee Leon Judd said in a statement.
After the July 31 discontinuation of benefits, the retirees will have a three-pronged choice when if comes to their future health care:
- pay for the continuation of their existing medical coverage through October 2003
- pay for employer-sponsored coverage with reduced rates and benefits
- find their own medical coverage.
Objections to National’s motion to terminate benefits may be filed with the US Bankruptcy Court until 4 p.m. central time Monday in the Northern District of Illinois Eastern Division. If any objections are filed, a hearing will be scheduled for 9:30 a.m. central time on July 24.
Help From Outside
After the announcement, the Independent Steelworkers Union (ISU), which does not represent National retirees, announced plans to step in and help the retirees affected by the decision. “This is a very, very sad situation,” ISU President Mark Glyptis said . “It’s a travesty.”
Glyptis said National retirees have received letters in the mail this week informing them they will have no health care benefits in two weeks and many of them are ill-equipped to deal with the situation. “Our retirees are faced with, ‘Do I eat or buy medicine?”’ Glyptis said. “Either one of them is a pretty devastating result.”
Calling this not a union issue but “a people issue,” Glyptis said the ISU is currently working on putting together a group health plan through the union at special rates. Even though he sees this as a difficult task, particularly for participants with pre-existing conditions, Glyptis was confident in the union’s influence with the insurance companies to offer a low-cost solution.