Senior Move Managers

A study finds few U.S. companies plan to drop their retiree drug benefits immediately but many expect to do so in a few years.

The law creating Medicare prescription drug benefits created a subsidy for companies that offer retiree benefits at least as good as Medicare’s Part D.

The survey by the Kaiser Family Foundation and Hewitt Associates, a benefits consultant, also found that employers are continuing to drop retiree health benefits completely, the Washington Post reported. The percentage of companies with retiree health coverage dropped from 66 percent to 33 percent between 1988 and 2005, and slid 12 percent in the past year, with many companies cutting off new hires.

But the survey of 300 large employers found few plan to do away with prescription drug benefits.

“Most employers are accepting government subsidies and taking a wait-and-see attitude on the drug law,” said Drew E. Altman, president of the Kaiser Family Foundation.