MEBA Members and Retirees feel pinch of Health Care costs

"Those who went before us built this industry - they built it with their patriotism, their sweat, and their tears. For them, we must be ever mindful of this obligation. We cannot, and we will not, let them down."

Marine Engineers Beneficial Association (MEBA) President Ron Davis on the occasion of his receiving the Admiral of the Ocean Sea award in New York City on November 11, 2005 spoke those words.

Indeed, for a Union leader, those are words to live by. But MEBA Members and especially Retirees have been finding out just what those words mean. Davis and his fellow Trustees who make weighty decisions regarding the Union run medical plan, decided in October 2005 to cut benefits for all participants and impose drastic increases in the premiums paid by Retirees.



”.…... a six fold increase in med payments……”

For the average MEBA Retiree who is married, the increases will mean a 4 fold increase in premiums. For the poorest Retirees it means as much as a 6 fold increase. A Merchant Marine Officer who retired with a $2000 per month pension will now be expected to pay out over 1/3rd of that pension for medical coverage.

All participants in the plan will see higher co-pays, co-insurance and greater maximum out-of-pocket expenses. Only Retirees are required contribute to the cost of coverage.

The MEBA over the years has been able to provide Members and Retirees with a better health care plan than most Americans get and for good reason. “….we spend years working in hot engine rooms breathing asbestos….. these problems show up later in life.” In recent years the cost of this largesse has taken its toll. Also, Employer contribution rates have dropped. Retiree premiums were doubled just 3 years ago. The Union has taken steps to curtail costs by switching to PPO’s, but the adjustments are not enough.

In the past there was a percentage schedule for retirees. Premiums were based on retirement pay. The more affluent pensioners paid more, the poorer pensioners paid less. It was a system that no one seemed to mind. The new premium scheme calls for a minimum payment of $300 per month for single retirees and $700 per month for retirees with dependents who are not on Medicare. Medicare recipients will see their payments to the Government rise as the Union will no longer be paying for Medicare Part B.

While the same percentage rate of 6 percent of retirement pay is still in effect, only the most affluent retirees will come close to paying that. Senior Union Officials who retire with larger pensions than rank and file members will be protected from paying more because a cap of $800 per month has been placed on the premiums.

Employers have been trying to jettison pensioners and their liabilities for years. It seems now, with the help of Union officials, they have hit upon a back door method for doing so. The premiums have been raised to where participants can no longer afford to stay in the system. It is possible that as many as 75% of retirees will be seeking health care coverage in the commercial market or simply become one of the 46 million other Americans without health care coverage.

For three years, MEBA Union Officials have been telling Members that the condition of their health plan was fine, “we can ensure retiree medical benefits well into the future”. This included the time period they were up for election in 2004 and the period in 2005 that the election was under challenge. As soon as the election was over however, they changed their tune, saying if no changes are made, the medical plan will be bankrupted “in the near future”.

A group of dissident retirees who contacted an ERISA Attorney were told that what was done was perfectly legal, but “obviously a scam to protect Senior (Union) Officers”. These Retirees are also hoping to find some new officials in charge of the MEBA after the next election.

A Real Admiral wears a Hat