You are correct about the Medicare slash Medicaid slip. I dont know how I could have confused them. One is income redistribution and the other is a ponzi scheme.

As far as whether the veba fund will be around or not who knows I wont argue with your logic. I did say in theory we have an equal shot and I stand by it. I also think a medicare supplement was a fair goal in the 2006 contract. We will all be running to mexico for health care in ten years anyways.

But I stand by the laundered 25K account money comment, 25K per pilot is transfered into the account. 25K plus interest is transfrered to the eligible pilot upon his retirement, death, or his 59th birthday. No seed money or $.50 per hour money is going toward this account, that money is for medicare supplement.

"For each eligible active pilot (i) having a seniority list number on August 25, 2006 , (ii) who has attained at least age 53 before January 1, 2007, (iii) who is expected to meet the age and service requirements for coverage under the Retiree Group Health Plan as of his attainment of age 60 or older, and (iv) who retires on or after August 26, 2006, the Company will make a one-time cash payment of restricted signing bonus to the VEBA equal to $25,000. Such contributions shall be made no later than January 28, 2007 (90 days after October 30, 2006). The contribution and interest attributable thereto shall be transferred to the HRA established with respect to that pilot upon the date that the pilot attains age 59, or if earlier, as soon as practicable after the pilot dies. If a pilot attains age 59 or dies prior to the date that the Company funds the VEBA pursuant to this Section 27.H.7.b., the contribution and interest attributable to such pilot shall be transferred to the HRA as soon as possible after the date on which the Company funds the VEBA. "

 

So we had an extra $25K signing bonus for our favorite special interest group, the old panhandlers. And I've been paying every month toward a line that says VEBA on my pay statement.

Tell me, where did wet lease payments go before we temporarily stopped during it in 2007? We certainly never saw it. I've been told they partly funded the VEBA/Medicare supp/HRA/whatever you want to call it fund for those 53 and older.

 

THEREFORE BE IT RESOLVED the MEC directs the MEC Secretary-Treasurer to place these funds and any future scope payments in a suitable account until a decision has been made, and (resolution 06-05)

and from then Vice-Chair WH:

"I'd like to suggest that we designate any funds the company owes us in the form of scope violation payments be set aside for those who have paved the way before us and not gotten what I believe they deserve. I think this would prove to be a unifying process. To vote to make the retirees "whole" in terms of retro pay..."

And there it went. It's all about unity. I believe the wet leases stopped after 2006 peak and haven't returned until now. I say we give the money out to the junior guys on bidpacks that got screwed by 4a2b to make them "whole".

 

First, the VEBA sum we pay monthly, as already explained by Lag, funds post retirement medicare supplemental insurance. That is also where the 06 scope payments went to, as initial funding. Maybe you think that's only for old panhandlers, but unless you plan on dying prior to 65, you will use it too.

Second, prior to that, we actually got scope checks. I would have to search through my records, but I know I got at least one or two.

 

The wet lease money and the $.50 per hour went/goes to the veba for medicare supplement. Again we are all potential medicare supplement beneficiaries. All things being equal I dont think I will see any of it but it is a nice theory.

The HRA was a seperate "restrictive signing bonus" for the 53 year olds. My guess, the 25K was laundered through the veba account to make it easier to deal with the IRS. But it is a direct money in money out payout. It has always interested me why the company played along with the union and kept the total of the "restrictive signing bonus" away from the membership.

Since I have attained the ripe old age of 53 part of me hopes that we continue to persue special deals for special members. The rest of me knows it is not good for the union. That does not mean that we should not find a way to help retired pilots with medical costs. IMHO any help we can give to pilots who actually retire prior to 65 with health insurance is probably money well spent. And I dont object to helping post medicare pilots either.

 

They don't want you and I to connect the dots. When they are too cash strapped to make accepted fares, the FDA LOA, 777 pay rates, newhire training pay right, they still have enough to offer bonuses and high 727 SO payrates (>12 yrs) to a select group. They also have enough $$ to run an expensive, false excess bid out of the 727 SO seat followed almost immediately by excess bids out of all widebody seats. I can still hear OR's claim that they need to get the excess pilots into the 727 FO and 727 SO seats to save money. Then why did PC excess out of the 727 SO seat just short while ago? You didn't need to save money when your buds were 727 SOs in 2007.

As the latest of those excessed approach 6 months in their new seats they're now spending more $$ on upgrading them again. It's o.k. because it's the short course for many.

There's lots of $$ being spent, just not for what we want it for.

 

How's that rice bowl comin'?

 

................

 

I followed up today and talked to the folks at R&I. The post-Medicare VEBA I guess is okay but I don't really see how it's that necessary. Right now at age 65 your Medicare payments are about $115/person/month. A very nice supplement package that will provide you with better care than our active pilot buy-up plan will cost you about $115/month/person in addition to that Medicare charge. This is what the VEBA is used for. So for summary, prior to VEBA your annual cost for post-Medicare coverage and supplement for you and your spouse was about $6000/yr. After VEBA it's about $3000/yr - both seem insanely cheap to me. So for young guys that have at least 20 years of working until they retire, they'll be contributing about $10,000 into this VEBA account and will get out of it about $3000/yr as long as they live (or their spouse lives). Doesn't really sound that great to me.

We still don't have great medical coverage for the pre-65 group which is where it can get expensive. The buy-up plan will cost you about $10K/yr for your and your spouse and the high deductible will be much less. This is what the HRA was put in for. Of course, ironically, most of the guys who got that $25K HRA are working until 65 (at least) and will just use that $25K for their Medicare supplements, premiums, etc making it completely ineffective as a retirement incentive from the entire group -i.e. a complete waste so I hope we don't waste any more precious negotiating capital on stuff like this.

 

Tuck,

I guess I don't quite understand your above (underlined and bolded statement. As well, your comment, which I highlighted in red, also doesn't seem to ring true.

Are you saying that over the course of a 20 year FedEx career, a guy will contribute about $10,000 into the VEBA fund, and then when he retires, he'll only get about $3000 worth of benefit from it, for each year he lives after retirement? And you're saying (your statement in red) that that really makes little sense? If that's what you're saying, I tend to disagree, because $3k a year in benefit, far outweighs what you could make if you had bought an annuity for that same $10,000. I'd expect that you'd see less than $1K per year on the $10K.

Veba seems to be a good deal, if you live long enough to actually use it. As well, I don't ever remember it being created as an incentive to get older guys to retire earlier. But then again, as I get older, I find myself suffering from that dreaded disease, CRS (can't remember sh!t.)

JJ