Editor's Corner


So, the healthcare news world doesn't seem to have made a big deal of this, but a very big transformation in the way one sector of the nation's healthcare is financed may be happening soon.

I'm talking about the talks ongoing between Ford, GM and the United Auto Workers, under which the UAW would take over the automakers' gigantic retiree health liabilities ($55 billion for GM alone!). If the talks succeed, the automakers will hand over retiree health funding to the UAW, and voilà, no more expanding debt for the Detroit auto giants. What a relief for them, and for Wall Street! But what are the implications for the retirees, and the health system generally?

Let me be the first to admit that I'm not a benefits administration expert, so I don't have an opinion as to how the funding issues will play out. All I know is that if a new stakeholder suddenly controls that much healthcare money, something is likely to change, as I doubt the unions will run health benefits the way a publicly-traded manufacturer will, at least at first.

Historically, unions have (not surprisingly) fought hard to provide the richest benefits for their members--but at the expense of their corporate masters. What will it mean if unions control retiree health funds themselves?

I don't know. But my guess, however, is that they'll eventually find themselves in the unsympathetic position of beginning to shrink benefits rather than grow them. And if so, some elderly, rock-solid union members may be in for a nasty surprise when they want that expensive investigational procedure! This should be an interesting one to watch. - Anne

P.S. FYI, we've added a regular "Chutes & Ladders" column to FierceHealthcare. We welcome your personnel announcements, so please feel free to send them to associate editor Maureen Martino.

Suggested Articles

The profit margins and management of Community Health Group raise questions about oversight of managed care insurers.

Financial experts are warning practices about the pitfalls of promoting medical credit cards to their patients.

A proposed rule issued by HHS on Tuesday would expand short-term coverage, a move Seema Verma said will have "virtually no impact" on ACA premiums.