DAL early retirement 2009/2011
04-29-2011, 10:57 AM
#181
Line Holder
Joined APC: Feb 2008
Posts: 40
First off, the pilot early out program was called the PIRP not the PERP (Pilot incentive retirement program.) The HTCT provides a 65% tax CREDIT to those pilots who are retired, receiving money from the PBGC in a monthly payment, are 55 or over and in a qualified health insurance program. (Note: not all health insurance programs are HCTC qualified. Delta's is however.) For us, the Delta health insurance was about $1100 a month for two. With the HCTC, it knocked it down to around $400. We were able to buy better insurance on our own however and did not take advantage of the credit (plus we were not 55 yet). It may be that as we get older and into a higher risk pool the Delta insurance and the HCTC is the way to go, but not for now.
If health insurance is holding you back from early retirement, you are making a mistake. If you are in reasonably good health (no MI's or cancer) you should be able to get health insurance (high deductible) for $250-400 month for two people.
Come on in. The water is fine.
If health insurance is holding you back from early retirement, you are making a mistake. If you are in reasonably good health (no MI's or cancer) you should be able to get health insurance (high deductible) for $250-400 month for two people.
Come on in. The water is fine.
04-30-2011, 09:48 AM
#182
Gets Weekends Off
Joined APC: Apr 2008
Posts: 1,462
First off, the pilot early out program was called the PIRP not the PERP (Pilot incentive retirement program.) The HTCT provides a 65% tax CREDIT to those pilots who are retired, receiving money from the PBGC in a monthly payment, are 55 or over and in a qualified health insurance program. (Note: not all health insurance programs are HCTC qualified. Delta's is however.) For us, the Delta health insurance was about $1100 a month for two. With the HCTC, it knocked it down to around $400. We were able to buy better insurance on our own however and did not take advantage of the credit (plus we were not 55 yet). It may be that as we get older and into a higher risk pool the Delta insurance and the HCTC is the way to go, but not for now.
If health insurance is holding you back from early retirement, you are making a mistake. If you are in reasonably good health (no MI's or cancer) you should be able to get health insurance (high deductible) for $250-400 month for two people.
Come on in. The water is fine.
If health insurance is holding you back from early retirement, you are making a mistake. If you are in reasonably good health (no MI's or cancer) you should be able to get health insurance (high deductible) for $250-400 month for two people.
Come on in. The water is fine.
1) The HCTC 65% discount is only good for 18 months
2) Your $1100/month quote must be for the pre-60 coverage, where you have to pay 100% of the costs. After age 60, that drops to 51%.
04-30-2011, 09:53 AM
#183
Gets Weekends Off
Joined APC: Apr 2008
Posts: 1,462
Heyas PG,
Looking at the ALPA "promotional materials" from prior to SOC, a pilot who decides to take early retirement before age 65 (sad that "early" is now before 65), the cost is roughly TWICE what it was under the NWA contract.
Retirement pre-age 60 it is nearly six times the cost. Under the fNWA contract, you simply had to have 15 years service to be eligible for retiree health insurance, no matter when you retired.
Mind you, this is a comparason between the old DAL DPMP and the NWA Standard plan, which was superior in every way. An apples to apples comparason would probably be even greater.
If you were to retire at 60 (vs 65), and you had a spouse and, say, one child still on insurance, you'd be well into the five figures difference over five years.
Nu
Looking at the ALPA "promotional materials" from prior to SOC, a pilot who decides to take early retirement before age 65 (sad that "early" is now before 65), the cost is roughly TWICE what it was under the NWA contract.
Retirement pre-age 60 it is nearly six times the cost. Under the fNWA contract, you simply had to have 15 years service to be eligible for retiree health insurance, no matter when you retired.
Mind you, this is a comparason between the old DAL DPMP and the NWA Standard plan, which was superior in every way. An apples to apples comparason would probably be even greater.
If you were to retire at 60 (vs 65), and you had a spouse and, say, one child still on insurance, you'd be well into the five figures difference over five years.
Nu
1) The 2008 pre-merger NWA retiree rate was $590/mo for a family.
2) Since the NWA contract had a 7% premium increase, assuming health costs have gone up at that rate, puts the 2011 rate at $723/mo.
3) The current 2011 DAL Option N family rate for post age 60 retirees is $787.
4) If my math skills haven't failed me, that's a $64/mo difference.
5) Comparing the NWA pre-bankruptcy rate, to the DPMP post bankruptcy rate is comparing apples to golf balls.
Please feel free to provide your own hard numbers to refute these.
Bottom line: retiree health care is expensive, just like active care is. And it took hits in bankruptcy, just like active guys did. But to say its preventing thousands of guys from retiring isn't supported by facts.
04-30-2011, 10:31 AM
#184
Gets Weekends Off
Joined APC: Mar 2008
Posts: 3,902
I can't speak for whatever "promotional materials" may have been presented on the N side. But I just emailed the Delta MEC R&I Benefits specialist and got the following info:
1) The 2008 pre-merger NWA retiree rate was $590/mo for a family.
2) Since the NWA contract had a 7% premium increase, assuming health costs have gone up at that rate, puts the 2011 rate at $723/mo.
3) The current 2011 DAL Option N family rate for post age 60 retirees is $787.
4) If my math skills haven't failed me, that's a $64/mo difference.
5) Comparing the NWA pre-bankruptcy rate, to the DPMP post bankruptcy rate is comparing apples to golf balls.
Please feel free to provide your own hard numbers to refute these.
Bottom line: retiree health care is expensive, just like active care is. And it took hits in bankruptcy, just like active guys did. But to say its preventing thousands of guys from retiring isn't supported by facts.
1) The 2008 pre-merger NWA retiree rate was $590/mo for a family.
2) Since the NWA contract had a 7% premium increase, assuming health costs have gone up at that rate, puts the 2011 rate at $723/mo.
3) The current 2011 DAL Option N family rate for post age 60 retirees is $787.
4) If my math skills haven't failed me, that's a $64/mo difference.
5) Comparing the NWA pre-bankruptcy rate, to the DPMP post bankruptcy rate is comparing apples to golf balls.
Please feel free to provide your own hard numbers to refute these.
Bottom line: retiree health care is expensive, just like active care is. And it took hits in bankruptcy, just like active guys did. But to say its preventing thousands of guys from retiring isn't supported by facts.
1) You are correct, the NWA plan for pilot + family was $590 in 2008
2) The NWA had a %7 cap on increases. The DAL plan had NO cap on increases.
3) The premium for a DAL pilot to get the DPMP for retiree + family
coverage in 2008 was four figures. THAT WAS THE CHEAPEST OPTION. The HSA Gold plan was significantly higher.
4) For just a retiree and spouse, it was less than half the cost for the NWA plan, than the for the DPMP.
5) If you wanted to go BEFORE 60, then the costs are horrific. The NWA system had no such penalty for insurance (only 15 years service).
5) This isn't pre-BK. These were the plans in place at SOC.
Nu
Last edited by NuGuy; 04-30-2011 at 10:54 AM.
04-30-2011, 03:42 PM
#185
Gets Weekends Off
Joined APC: Apr 2008
Posts: 1,462
My hard numbers (from ALPA provided slides during the JCBA "sell"...I took good notes):
1) You are correct, the NWA plan for pilot + family was $590 in 2008
2) The NWA had a %7 cap on increases. The DAL plan had NO cap on increases.
3) The premium for a DAL pilot to get the DPMP for retiree + family
coverage in 2008 was four figures. THAT WAS THE CHEAPEST OPTION. The HSA Gold plan was significantly higher.
4) For just a retiree and spouse, it was less than half the cost for the NWA plan, than the for the DPMP.
5) If you wanted to go BEFORE 60, then the costs are horrific. The NWA system had no such penalty for insurance (only 15 years service).
5) This isn't pre-BK. These were the plans in place at SOC.
Nu
1) You are correct, the NWA plan for pilot + family was $590 in 2008
2) The NWA had a %7 cap on increases. The DAL plan had NO cap on increases.
3) The premium for a DAL pilot to get the DPMP for retiree + family
coverage in 2008 was four figures. THAT WAS THE CHEAPEST OPTION. The HSA Gold plan was significantly higher.
4) For just a retiree and spouse, it was less than half the cost for the NWA plan, than the for the DPMP.
5) If you wanted to go BEFORE 60, then the costs are horrific. The NWA system had no such penalty for insurance (only 15 years service).
5) This isn't pre-BK. These were the plans in place at SOC.
Nu
Today, the rates are much closer than they were 3 years ago. DPMP is still $1,080 (family) compared to $850 for Option N. These include both medical and dental.
So, assuming the pilot had Option N, and then retires at age 60, the rate for just a pilot/spouse goes from $265 to $678, an increase of $413/mo. That times 60 months equals $25k, or less than 2 months pay for most of the senior guys who are retiring. So contrary to what you previously said, "a few months of cash" oughta cut it, if that's what's holding him back.
05-01-2011, 12:02 PM
#188
Line Holder
Joined APC: Feb 2008
Posts: 40
Hi Pineapple Guy,
Could not find a reference to the 18 month limitation. I looked this up on the IRS website and found only this.
8. How long can I receive the HCTC for?
You can receive the HCTC for as long as you continue to meet the eligibility requirements. Learn more by visiting the HCTC Eligibility Requirements page.
Can you cite your source on this?
Thanks!
05-01-2011, 12:23 PM
#189
Gets Weekends Off
Joined APC: Apr 2008
Posts: 1,462
Hi Pineapple Guy,
Could not find a reference to the 18 month limitation. I looked this up on the IRS website and found only this.
8. How long can I receive the HCTC for?
You can receive the HCTC for as long as you continue to meet the eligibility requirements. Learn more by visiting the HCTC Eligibility Requirements page.
Can you cite your source on this?
Thanks!
Could not find a reference to the 18 month limitation. I looked this up on the IRS website and found only this.
8. How long can I receive the HCTC for?
You can receive the HCTC for as long as you continue to meet the eligibility requirements. Learn more by visiting the HCTC Eligibility Requirements page.
Can you cite your source on this?
Thanks!
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