Business
Automaker bases premiums on pay
NEWS IN BRIEF — Posted April 10, 2006
DaimlerChrysler Group executives and managers will pay higher premiums for health coverage than shop workers and administrative employees in a move the car manufacturer hopes will help curb its health care costs.
The company, which estimates total health care cost per employee to be $11,000 annually, will use a sliding scale for premiums.
Top executives could pay up to the full company cost for their health insurance, while workers on the lowest levels would not be affected, DaimlerChrysler officials said.
The company estimated middle managers would see an average increase of $450 in 2007, while executives could see increases as high as $1,500.
Retirees younger than 65 would see their premiums change based on the employee's exit base salary, according to the company.
DaimlerChrysler also said it will establish health care retirement accounts and contribute $1,750 annually for retirees eligible for Medicare.
Expected to cost $2.3 billion in 2006, health care is one of DaimlerChrysler's highest fixed costs.
Note: This item originally appeared at http://www.ama-assn.org/amednews/2006/04/10/bibf0410.htm.
