EEOC Could Permit Cuts to Medicare Coverage

Retirees who qualify for Medicare would see their health benefits cut or eliminated under a proposal approved Thursday by the Equal Employment Opportunity Commission (search).

The commission voted 3 to 1 in approval of the proposed rule, with three Republicans in favor and one Democrat opposing it.

Under the rule, employers can coordinate health benefits for retirees who are eligible for Medicare or a similar state-sponsored health benefit. Employers had been prohibited from doing so since 2001, after a federal appeals court concluded that coordinating health benefits was illegal age discrimination.

"Such benefits are provided on a voluntary basis at the discretion of each employer and the Commission is acting to preserve these valuable benefits for retirees," Commission Chair Cari Dominguez, a Republican, said in a statement.

Before it becomes final, the proposed rule must go through further review by federal agencies and the White House Office of Management and Budget (search).

The AARP (search), which represents millions of retirees, was disappointed with the commission's decision.

"More than 12 million Medicare beneficiaries receive benefits from their former employers," Michael Naylor, the group's advocacy director, said in a statement. "AARP is concerned that this rule may jeopardize those benefits."

The commission had the support of Rep. John Boehner, chairman of the House Workforce Committee. He said the rule would "help preserve important retiree health benefits for millions of American seniors."

The Ohio representative had sent a letter to Dominguez in December, pushing for the rule. The letter was also signed by Reps. Robert Andrews, D-N.J., and Sam Johnson, R-Texas.