Update on Lockheed Martin Medical Coverage Developments

From: Maury Mechanick - Apr 10, 2015

I wanted to share a quick update on developments related to the LM changes in medical coverage. Rich Lustig, on behalf of COMARA, had a meeting recently with Mike Bradley, his successor at Lockheed Martin, to review the many questions and open issues that have arisen. His summary of the outcome of the meeting is provided below. I think in general the information that Rich has obtained is extremely helpful and certainly clarifies a lot of what has happened. On particular note, there is now a better explanation of the derivation of the $3000 figure used for the HRA for COMSAT retirees who have been getting medical coverage from LM previously, and the $3900 figure used for those members of the class of 1983 with respect to continuity for those who had been promised coverage with no cost. A separate issue had arisen with respect to certain retired senior executives who are also promised medical coverage at no cost via the SERP plan that applied to them, and Rich was successful in getting that situation clarified as well. Also, he was able to reconfirm that these developments in no way affect LM's maintenance of the life insurance for retirees.

I believe this successfully addresses the various issues that have come to our attention and the explanations do appear to provide greater clarity as well as a sense of reasonableness as to what is being done.

I also want to expressly thank Rich Lustig for all of his work and effort in this regard, as well as the excellent results that he has obtained. COMARA definitely owes him a debt of gratitude.

If anyone has any questions, please direct those to me.

Regards,
Maury Mechanick

Report from Richard Lustig about LM Medical Meeting

My meeting today went very well with Mark Bradley and here's the synopsis of what we covered:

  1. Determination of $3,000 as the equivalent amount for current LMC coverage.
    • The LMC actuarial team has determined that $3,000 represents the 80% of the annual amount to cover an equivalent Medigap plan AND 80% of the cost of a dental plan. This number breaks down to $2,520 for Medigap and $480 for dental. COMSAT retirees paid 20% of the cost for medical and dental coverage and were grandfathered in that provision at the closing of LMGT.
    • Please note that current LMC retirees will only be receiving an annual allowance of $900 which represents the equivalent current LM post 65 Medigap plan subsidy being provided. They do not have dental coverage.
  2. Determination of $3,900 as the equivalent amount for current LMC coverage (grandfathered groups, no contributions).
    • The LMC actuarial team has determined that $3,900 represents the 100% of the annual amount to cover an equivalent Medigap plan AND 100% of the cost of a dental plan.
  3. SERP participants that receive medical with no contribution required.
    • LMC will go back and review all of the SERP retiree letters and revise where required ($3,900 amount if enrolled in medical). I don't want to detail personal information regarding John Evans but I can tell you that his communication is correct. John should pursue this directly with Mark Bradley if he so desires to go further.
  4. Continuation of COMSAT/LMGT retiree dental.
    • LM retiree dental as delivered today goes away along with the Medigap plans. Allowances have been included per the above notations.
  5. Verification that COMSAT/LMGT retiree life insurance is unchanged.
    • COMSAT/LMGT retiree life insurance obligations remain unchanged and is not included in the medical/dental outsourcing.

A couple of other notes ...

There's no determination at this time as to whether or not the annual allowances will remain the same into the future. Don't read into this. It just means they are not committing to any increase in the allowances or whether or not the allowances would be reduced or eliminated one day if so desired.

A separate allowance for the retiree and spouse may be an advantage in selecting individual plan coverages that provide a better fit for each of their own needs.

This change also provides more opportunity for plans that work better for the retiree based on their physical location.

There is a vision plan that is not offered today on a group enrollment basis available for purchase on the Exchange. Participant pays entire premium.

It's critical that all retirees (whether enrolled in medical today or not) pay immediate and close attention to the mailings. There are one time incentives for completing your enrollment before the first deadline and less liberal terms and conditions for late enrollment. Mailings were made to all retirees; enrolled in a plan and those that have currently opted out of all coverages or opted out of medical or dental.

I hope this addresses all of the concerns that the retirees have brought forward. Please let me know if you have any questions. As always, glad to be of assistance to the COMSAT family!

Richard Lustig

There are two important attachments that provide additional detail to this benefits summary. These are both in pdf format. If you have any problems with reading or printing these documents, please get in touch with the webmaster at webmaster@comara.org, and he can probably provide the document in another format.

2015 COMARA Update on Health-Care Retirement Benefits
This three page document summarizes the information that LMC shared with Richard Lustig.

2015 LMC-HRA Insert Dental LHD5 Final
This 8 page document, from OneExchange, discusses Dental Coverage, Healthe Reimbursement Arrangement (HRA), Enrolling in coverage, and some Frequently Asked Question. The deadline for enrollment is May 29, 2015