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KEYWORD:
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Employee Benefits Bulletin December 2001Retiree Health Benefits UpdateOn August 20, 2001, the Equal Employment Opportunity Commission ("EEOC") officially withdrew its current interpretation of how the Age Discrimination in Employment Act ("ADEA") applies to retiree health benefit plans. The EEOC's interpretation was based on the Erie County Retirees Association v. County of Erie case, which held that an employer's plan violated the ADEA because it provided different health benefits for retirees based upon eligibility for Medicare. This decision has garnered much criticism since it goes against the conventional wisdom and might lead employers to terminate or reduce retiree health care coverage if the law requires coverage to continue beyond Medicare entitlement. The Erie case is still good law in the Third Circuit (PA, NJ & DE), but the interpretation withdrawal by the EEOC is a very good sign that future law and guidance regarding retiree health benefits might be more in line with current practice.
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