Sunday, July 20, 2003

From blog correspondent Lee Penn
Employers fire, end insurance for disabled workers
[Jul 14, 2003] [Extracts] The Wall Street Journal on July 14 examines the increased number of companies that have begun to fire employees with disabilities to reduce health care costs. According to the Journal, employees with disabilities have become "an increasingly common casualty of the drive to cut costs" as health insurance expenses and the number of disabled employees increase and as many companies face bankruptcies and takeovers. For example, Polaroid last July fired 180 disabled employees and terminated their health insurance as the company prepared to sell assets to Bank One. A survey conducted last year by Mercer Human Resource Consulting found that 27% of the 723 companies interviewed immediately terminate employees on long-term disability, and 24% terminate the employees at a set time after they are on long-term disability, often between six and 12 months; 15% of the companies retained employees on long-term disability and provided them with health insurance until they reached age 65. Although terminated employees can retain their employer-sponsored health insurance for 18 months through COBRA and disabled employees can purchase Medicare coverage after 18 months, few employees can afford the cost of the coverage... However, the "disability-payment squeeze is likely to continue for companies and their employees," the Journal reports. The Department of Labor estimates that 5.5 million individuals were on long-term disability last year, a 62% increase from 1992. The "reasons for the big rise aren't completely understood, but the most cited explanation is an aging work force," the Journal reports (Pereira, Wall Street Journal, 7/14).

Commentary:

James 5
1 Go to now, ye rich men, weep and howl for your miseries that shall come
upon you.
2 Your riches are corrupted, and your garments are motheaten.
3 Your gold and silver is cankered; and the rust of them shall be a witness
against you, and shall eat your flesh as it were fire. Ye have heaped
treasure together for the last days.
4 Behold, the hire of the labourers who have reaped down your fields, which
is of you kept back by fraud, crieth: and the cries of them which have reaped
are entered into the ears of the Lord of sabaoth.
5 Ye have lived in pleasure on the earth, and been wanton; ye have
nourished your hearts, as in a day of slaughter.

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