Boeing: Health Care Reform Will Cost Them $150 Million

The newly enacted Health Care reform law will cost Boeing $150 million, according to the press release issued by Boeing today. According to the release, in 2013, Boeing will no longer be able to take a deduction related to prescription drug benefits for its retirees, but reimbursed under Medicare Part D. Boeing's announcement of its anticipated increased costs due to health care legislation comes on the heels of other major companies reporting similar astronomical cost increases.

Other large businesses also seeing dramatic cost increases due to health care reform

As Associated Content's Don Simkovich reported earlier this month, heavy equipment manufacturer, Caterpillar, complained to House of Representatives Speaker Pelosi and Minority Leader Boehner that the health care bills would cost them an additional $100 million in the first year alone. According to Caterpillar, this is a 20% increase in costs to them due to expansion of Medicare taxes as well as the insurance mandate required under the law.

Verizon is also feeling the sting of the health care reform bills. The National Review published an email sent out to Verizon's employees addressing what the health care reform legislation would mean to Verizon employees. The Verizon email hints at a possible change coming because the new law affects the subsidy of prescription drugs for retirees. The email stated, "However, changes affecting the Part D subsidy will make it less valuable to employers, like Verizon, and as a result, may have significant implications for both retirees and employers. Verizon also acknowledged that some of its benefits packages would be considered 'Cadillac plans' and thus subject to the 40% excise tax. Verizon employees and retirees can read between the lines and know that their benefits packages will be taking a future hit as a result of reform.

AT&T reported a similar reason for its anticipated $1 billion extra costs due to the passage of the health care bill. AT&T's billion dollar price increase is tied to the ending of Medicare subsidies for its retirees. According to BusinessWeek, the company will be looking into making changes in the health benefits of its current and retired employees to help offset the loss caused by health care legislation.

John Deere is in the same boat as Caterpillar, releasing it's own projected costs due to health care reform legislation. According to a John Deere press release on March 25, John Deere expects its expenses to jump $150 million, primarily in 2nd quarter 2010.

As more companies tally up the cost of the newly enacted health care reform laws, there are sure to be more press releases forthcoming.

Sources:

Caterpillar: Health Care Bill Would Cost It $100 Million, retrieved 3/31/2010
AT&T To Take 1 Billion Charge On Health Care Reform
John Deere press release, 3/25/2010
Caterpillar Claims Health Care Reform Would Hit Them For 100 Million