Judge Blocks Rule Allowing Companies to Cut Benefits When Retirees Reach Medicare Age

NYT

A federal district judge on Wednesday blocked a Bush administration rule that would have allowed employers to reduce or eliminate health benefits for retirees when they reach age 65 and become eligible for Medicare.

Ten million retirees could have had benefits cut under the rule, which was adopted last April by the Equal Employment Opportunity Commission.

The judge, Anita B. Brody of the Federal District Court in Philadelphia, struck down the rule and issued a permanent injunction that prohibits federal officials from enforcing it.

The rule "is contrary to Congressional intent and the plain language of the Age Discrimination in Employment Act," the 1967 law that bans most forms of age discrimination in the workplace, Judge Brody wrote.

The erosion of retiree health benefits is an explosive political issue. Before issuing the rule, the commission was deluged with letters opposing it.