UAW Bailout in HR 3200

One aspect of the wealthshare bill proposed by Democrats is found beginning on page 64, section 164.   It appears benign, and is overshadowed by the death panel and immigration debate, but-do not be deceived.  Text is below:



(1) IN GENERAL.–Not later than 90 days after the date of the enactment of this Act, the Secretary of Health and Human Services shall establish a temporary reinsurance program (in this section referred to as the ”reinsurance program”) to provide reimbursement to assist participating employment-based plans with the cost of providing health benefits to retirees and to eligible spouses, surviving spouses and dependents of such retirees.      (2) DEFINITIONS.–For purposes of this section:

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(A) The term ”eligible employment-based plan” means a group health benefits plan
that– (i) is maintained by one or more em-ployers, former employers or employee associations, or a voluntary employees’ beneficiary association, or a committee or board of individuals appointed to administer such plan, and (ii) provides health benefits to retirees.

(B) The term ”health benefits” means medical, surgical, hospital, prescription drug,
and such other benefits as shall be determined by the Secretary, whether self-funded or delivered through the purchase of insurance or otherwise.

(C) The term ”participating employment-based plan” means an eligible employment-based plan that is participating in the reinsurance program.

(D) The term ”retiree” means, with respect to a participating employment-benefit
plan, an individual who-(i) is 55 years of age or older;

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(ii) is not eligible for coverage under title XVIII of the Social Security Act; and (iii) is not an active employee of an employer maintaining the plan or of any
employer that makes or has made substantial contributions to fund such plan.

(E) The term ”Secretary” means Secretary of Health and Human Services.   (b) PARTICIPATION.–To be eligible to participate in the reinsurance program, an eligible employment-based plan shall submit to the Secretary an application for participation in the program, at such time, in such manner, and containing such information as the Secretary shall require.  (c) PAYMENT      (1) SUBMISSION OF CLAIMS.– A) IN GENERAL.–Under the reinsurance program, a participating employment-based plan shall submit claims for reimbursement to the Secretary which shall contain documentation of the actual costs of the items and services for which each claim is being submitted. (B) BASIS FOR CLAIMS.–Each claim submitted under subparagraph (A) shall be based on the actual amount expended by the participant

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employment-based plan involved within the plan year for the appropriate employment based health benefits provided to a retiree or to the spouse, surviving spouse, or dependent of a retiree. In determining the amount of any claim for purposes of this subsection, the participating employment-based plan shall take into account any negotiated price concessions (such as discounts, direct or indirect subsidies, rebates, and direct or indirect remunerations) obtained by such plan with respect to such health benefits. For purposes of calculating the amount of any claim, the costs paid by the retiree or by the spouse, surviving spouse, or dependent of the retiree in the form of deductibles, co-payments, and co-insurance shall be included along with the amounts paid by the participating employment-based plan.

(2) PROGRAM PAYMENTS AND LIMIT.–If the Secretary determines that a participating employment-based plan has submitted a valid claim under paragraph (1), the Secretary shall reimburse such plan for 80 percent of that portion of the costs attributable to such claim that exceeds $15,000, but is less than $90,000. Such amounts shall be adjusted

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each year based on the percentage increase in the medical care component of the Consumer Price Index (rounded to the nearest multiple of $1,000) for the year involved.

(3) USE OF PAYMENTS.–Amounts paid to a participating employment-based plan under this subsection shall be used to lower the costs borne directly by the participants and beneficiaries for health benefits provided under such plan in the form of premiums, co-payments, deductibles, co-insurance, or other out-of-pocket costs. Such payments shall not be used to reduce the costs of an employer maintaining the participating employment-based plan. The Secretary shall develop a mechanism to monitor the appropriate use of such payments by such plans.

The Secretary shall establish–

(A) an appeals process to permit participating employment-based plans to appeal a determination of the Secretary with respect to claims submitted under this section; and

(B) procedures to protect against fraud, waste, and abuse under the program.

(5) AUDITS.–The Secretary shall conduct annual audits of claims data submitted by partici-

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pating employment-based plans under this section to ensure that they are in compliance with the requirements of this section.



(A) IN GENERAL.–There is established in the Treasury of the United States a trust fund to be known as the ”Retiree Reserve Trust Fund” (referred to in this section as the ”Trust Fund”), that shall consist of such amounts as may be appropriated or credited to the Trust Fund as provided for in this subsection to enable the Secretary to carry out the reinsurance program. Such amounts shall remain available until expended.

(B) FUNDING.–There are hereby appropriated to the Trust Fund, out of any moneys in the Treasury not otherwise appropriated, an amount requested by the Secretary as necessary to carry out this section, except that the total of all such amounts requested shall not exceed  $10,000,000,000.00.

***********************************************10 Billion dollars**********************************************

Sounds fine, right?  Not so fast. This little gem is payback from the President to the unions that spend over $50 million dollars to put him in office and it is they, for the most part, lobbying hard for socialized medicine.  As IBD puts it:  a $10 billion bailout for their mismanaged pensions — at our expense.  …  Further in the IBD piece is the explanation for the “bailout.”

But there’s a problem with all this largesse — the poor and middle class who don’t get these fat pensions end up paying for them anyway. Back in February, President Obama praised unions for their “sacrifices” in the auto bailouts. We’ve yet to see taxpayers praised or thanked for their “sacrifices” in bailing out unions.

Unions gave $52 million to elect Democrats in the last election. The link between bailouts and campaign cash couldn’t be clearer.

Frankly, their “investment” has paid off handsomely.

Part of their “return” includes GM and Chrysler shares that rightfully belonged to bondholders. Major provisions in the $787 billion stimulus are little more than union gifts. These include huge public works and infrastructure projects that hire exclusively union labor, and protectionist measures that reward unions at the cost of economic growth, such as Buy American provisions.

Nice work, if you can get it, especially at the expense of others.

Freep.com has more on this, here.  According to Hyde and Spangler who authored the piece:

Antilabor forces say it’s welfare for the UAW and Democrats’ union allies. Labor supporters say it falls short of what’s needed as tens of thousands of union members are pushed into early retirement as employers cut back health care coverage.

They’re both talking about a $10-billion provision tucked deep inside thousands of pages of health care overhaul bills that could help the UAW’s retiree health-care plan and other union-backed plans.

It would see the government — at least temporarily — pay 80 cents on the dollar to corporate and union insurance plans for claims between $15,000 and $90,000 for retirees age 55 to 64.

Big businesses with union workers are twice as likely to offer retiree benefits as nonunion ones.

Greg Mourad of the National Right to Work Committee called it “a shameless case of political payback,” saying Democrats and President Barack Obama are trying “to force the rest of us to pay billions to cover those unions’ health care.” 

Labor advocates say even more funding may be needed.

“It is not enough money,” said former U.S. Rep. David Bonior, a Mt. Clemens Democrat who chairs the board at Washington, D.C.-based American Rights at Work, a labor advocacy group. “That will have to be supplemented to fill the gap.”

Further down the piece gives a 12 year figure for the demise of the UAW if they don’t get any money.

$10 Billion is not enough?????   To that, UAW, I say, RIP.