Cignas health plan is to trim benefits for workers and cut benefits for retirees and parents of dependent children by 25 per cent, it has announced.
The changes will come into effect in April, with the biggest cuts expected to come in the first half of next year.
“In light of the recent national debate on the health care crisis, we have made the difficult decision to reduce benefits to our employees, retirees, and dependents,” said Chief Executive Officer Scott Schmucker.
The company says its plans to trim its employee benefits will be in line with the company’s broader plans for reducing costs and delivering better service to customers.
“We’re working to ensure that our employees are getting the best value for their money in order to improve their quality of life,” Schmuckersaid.
Cignares plans to reduce its employee health benefits to $1,500 for workers under age 25.
It also plans to eliminate its pension plan, reduce its health insurance and other benefits and make it more cost-effective.
Citi is cutting its employee contribution to its 401(k)s and health plans by $1.5 million.
Citeo plans to cut its employee contributions to its health plans and 401(ks) by $3 million.
Both are part of the companys broader effort to reduce costs, increase customer service and provide more options to its customers.
Cirahealth, the health insurer owned by Cignes parent company, Cignums health plans, said its 401K and health plan contributions would be reduced by $4 million.
The savings come after Cira health plans announced in January that it was cutting the amount of money it would contribute to its employees’ 401(d).
“While Cira is working to improve our health care plan and reduce costs to our members, we are also taking a step to ensure we remain a responsible employer that respects all of our employees’ needs,” said CEO and President Jim Ruggieri.
In January, Cira plans to increase contributions to employees’ retirement accounts by about $200 a month.
Ruggirisaid that the company had taken a “cost-cutting, risk-based approach” and would no longer be a risk-free financial asset.
“Our plans will continue to protect our customers, and we will be working to maintain our profitability,” he said.
The Cignans chief financial officer, Peter Hahn, said Cignains plans will allow the company to keep its “core core core financials” and avoid the need to make “cost cuts.”
In February, Citi said it would cut its contributions to the 401(p)s of about 2.4 million employees.
The firm also said it planned to slash its health benefits by 25 percent to account for the company`s decision to cut out its 401ks.
“The company will not be offering health benefits at the current levels as we continue to focus on cost control,” said Citi Chief Financial Officer Peter H. Hahn in a statement.
He said the company would continue to invest in health care and other critical areas of its business.
In May, Cipollini said it was reducing its employee 401(a) contributions to about $10,000 from $25,000.
The change is expected to cost Cipolini about $9 million in lost revenue.
The insurer also plans a $1 million reduction in the amount it will contribute to employees` retirement accounts over the next three years.
Cipols plans to pay about $500 million in tax on its deferred compensation.
The move will come after the insurer reduced its deferred payment of more than $1 billion to workers last year, according to the company.
Ciplans shares were down about 2 per cent at $30.49 on Thursday.
The stock was up about 5 per cent last week.