Observers are leery of Postal Service plan to opt out of federal health and retirement programs

http://www.govexec.com/story_page.cfm?articleid=48588&dcn=todaysnews

By Emily Long elong@govexec.com August 22, 2011

The U.S. Postal Service's proposed break with federal health and retirement plans would weaken benefits for postal employee and possibly other government workers as well, observers caution. USPS earlier this month announced plans to seek legislative changes that would allow the agency to create its own health and retiree benefits programs. Postal workers currently are covered under the Federal Employees Health Benefits program, Civil Service Retirement System or Federal Employees Retirement System.

The agency also wants to cut 120,000 jobs by 2015, a move that will require changes in several labor provisions.

According to draft documents summarizing the changes, government-run benefit programs do not address the Postal Service's "unique demographic and program needs," nor do they allow the agency to control costs and provide compensation and benefits comparable to the private sector.

RELATED STORIES

* Buyout Watch 08/22/11
* Postal Service commences talks with two unions 08/18/11
* Postal service plans to slash 120,000 jobs, withdraw from federal benefits 08/12/11
* Postal Service seeks a lifeline from Congress 08/05/11
* Initiative targets thousands of post office locations and jobs 07/26/11

Under the proposal, postal retirees would continue to receive health insurance benefits comparable to those offered under FEHBP at equal or lower cost in addition to Medicare coverage. Active employees initially would be covered under simplified plan with benefits similar in value and cost to FEHBP, though the agency going forward would shift to a private sector model. The Postal Service would establish a separate program following private sector best practices to cover all new hires.

FULL story at link.