UPS Drops Health Care for Some Spouses, Blames Obamacare

By on

The company that claims to love logistics can’t figure out how to pay health care benefits for some of the spouses of its employees anymore.

UPS will keep employee spouses off the company health care plan if they are eligible for plans from their own employers. It’s partly Obamacare’s fault, UPS says. From Kaiser Health News:

Rising medical costs, “combined with the costs associated with the Affordable Care Act, have made it increasingly difficult to continue providing the same level of health care benefits to our employees at an affordable cost,” UPS said in a memo to employees.

UPS’ memo says it’s far from alone. “Based on market data, 35 percent of those companies [UPS studied] plan to exclude working spouses eligible for their own employer’s coverage in 2014,” it says. Some require an extra fee to cover spouses, but don’t deny coverage, Kaiser says.

Others suggest the dropping of coverage for employee spouses is not nearly as widespread, according to the Kaiser report:

  • “We don’t see a lot of that out there, but more than we used to,” Edward Fensholt, a senior vice president at insurance broker Lockton Cos., told Kaiser.
  • According to a study conducted by Towers Watson, only 4 percent of large employers excluded spouses this year, while another 8 percent plan to next year.
  • The nonpartisan Congressional Budget Office projected that health care reform would have a negligible effect on premiums for large employers.

UPS’ decision, which takes effect in 2014, will exclude about 15,000 working spouses who have other options for getting coverage, and save about $60 million a year, UPS says. It will allow unemployed spouses and those whose employers don’t offer coverage to remain on the plan.

Analysts suggest the move has little to do with Obamacare and is actually just part of a long-term trend of corporations to trim health care benefits, Kaiser says. The company earned $807 million last year on revenue of $54.1 billion.

What do you think of UPS’ decision? Let us know on our Facebook page.

Sign up for our free newsletter

Like this article? Sign up for our newsletter and we'll send you a regular digest of our newest stories, full of money saving tips and advice, free! We'll also email you a PDF of Stacy Johnson's "205 Ways to Save Money" as soon as you've subscribed. It's full of great tips that'll help you save a ton of extra cash. It doesn't cost a dime, so why wait? Click here to sign up now.

Check out our hottest deals!

We're always adding new deals and coupons that'll save you big bucks. See the deals to the right and hundreds more in our Deals section.

Click here to explore 1,274 more deals!

Comments & discussion

We welcome your opinions, but let’s keep it civil. Like many businesses, we reserve the right to refuse service to anyone. In our case, that means those who communicate by name-calling, racism, using words designed to hurt others or generally acting like an uninformed bully. Also, comments that include links to email addresses or commercial websites typically aren't posted. This isn't a place to advertise your business.

  • smokey347

    tip of the iceberg. this obumo abomination is going to destroy what once was the greatest health system in the world. he’s right on schedule to turn america into a third world nation

    • Joe Serpico

      Greatest health care system in the world – yeah, sure. Maybe if you rank them by ‘greatest cost’. When it comes to actual care, the USA was ranked last out of 17 affluent countries in a study done a few months ago. Take off the blinders and stop blaming Obama for everything.

      • smokey347

        which explains why people in countries with socialized medicine flock to the U.S. for health care. get off the kool-aid joe

        • Joe Serpico

          No Kool-Aid here. Just accepting facts. Sure, some rich people who don’t want to wait can afford to come to the USA. Hardly a ‘flock’. Conversely, there are the ‘medical tourist’ Americans who go abroad where they get state-of-the-art care for a fraction of what it would have cost them here, even if they have insurance in the USA.

      • mimi

        smokey: Are you referring to the Canadian Health System, where Cruz’s mom had him? We have nothing like that here in the states. We’re totally dependent on FOR-PROFIT insurance companies.

  • Sophie

    This has been going on far longer than “Obamacare” has been around. Both my employer and my husband’s implemented this policy in 2008 BEFORE the election. Private companies saving money by cutting benefits is nothing new. It’s called capitalism. They are all about profit and cutting benefits was right up there with outsourcing. Stop blaming Obamacare for corporate greed.

    • mimi

      Sophie: Thanks. And we can thank corporate greed for weakening unions that gave rise to the middle class. When are corporations going to realize that it’s US that gave them their wealth? When are Americans going to realize that purchasing power is in our hands?