OPINION OF TRUSTEES
ROD Case No: 84-553 – February 24, 1988
Board of Trustees: Joseph P. Connors, Sr., Chairman; Paul R. Dean, Trustee;
William B. Jordan, Trustee; William Miller, Trustee; Donald E. Pierce, Jr., Trustee.
Pursuant to Article IX of the United Mine Workers of America (“UMWA”) 1950 Benefit Plan and Trust, and under the authority of an exemption granted by the United States Department of Labor, the Trustees have reviewed the facts and circumstances of this dispute concerning the level of health benefits coverage for a Pensioner under the terms of the Employer Benefit Plan.
The Complainant, whose last signatory classified employment in the coal industry was with the Respondent, was awarded a UMWA 1974 Pension Plan Deferred Vested pension based on 29 1/4 years of credited service, effective April 1, 1987. The Complainant indicates that the Benefit Plan implemented by the Respondent, effective May 1, 1987, did not provide health benefits coverage at the level prescribed by the terms of the Employer Benefit Plan established pursuant to the National Bituminous Coal Wage Agreement (“Wage Agreement”) of 1984. The Complainant states that benefit payments were subject to a $100 deductible for each of the first three family members enrolled and, thereafter, benefits were paid up to 80% of the cost of service. Information provided to the Funds indicates that the Respondent terminated the Complainant’s health benefits coverage on October 31, 1987.
Is the Respondent responsible for the provision of health benefits coverage for the Complainant at the level prescribed by the Employer Benefit Plan?
Positions of the Parties
Position of the Complainant: The Respondent is responsible for the provision of health benefits coverage for the Complainant at the level prescribed by the Employer Benefit Plan.
Position of the Respondent: The Respondent has not responded to repeated correspondence from Funds’ staff regarding its position in this dispute.
Article XX Section (c)(3)(i) of the National Bituminous Coal Wage Agreement of 1984 provides in pertinent part:
(c) 1974 Plans and Trusts
(3)(i) Each signatory Employer shall establish and maintain an Employee benefit plan to provide, implemented through an insurance carrier(s), health and other non-pension benefits for its Employees covered by this Agreement as well as pensioners, under the 1974 Pension Plan and Trust, whose last signatory classified employment was with such Employer. The benefits provided by the Employer to its eligible Participants pursuant to such plans shall be guaranteed during the term of this Agreement by that Employer at levels set forth in such plans.
Article I (1), (2) and (5) of the Employer Benefit Plan provide:
Article I – Definitions
The following terms shall have the meanings herein set forth:
(1) “Employer” means (Employer’s Name).
(2) “Wage Agreement” means the National Bituminous Coal Wage Agreement of 1984, as amended from time to time and any successor agreement.
(5) “Pensioner” shall mean any person who is receiving a pension, other than (i) a deferred vested pension based on less than 20 years of credited service, or (ii) a pension based in whole or in part on years of service credited under the terms of Article II G of the 1974 Pension Plan, or any corresponding paragraph of any successor thereto, under the 1974 Pension Plan (or any successor thereto) whose last classified signatory employment was with the Employer, subject to the provisions of Article II B of this Plan.
Article II B. (1) of the Employer Benefit Plan provides:
Article II – Eligibility
The persons eligible to receive the health benefits pursuant to Article III are as follows:
Health benefits and life insurance under Article III hereof shall be provided to Pensioners as follows:
(1) Any Pensioner who is not again employed in classified signatory employment subsequent to
(a) such Pensioner’s initial date of retirement under the 1974 Pension Plan, and
(b) October 1, 1984, shall be eligible for coverage as a Pensioner under, and subject to all other provisions of this Plan. Notwithstanding (i) and (ii) of the definition of Pensioner in Article I(5) of this Plan, any such Pensioner who was eligible for benefits under the 1974 Benefit Plan as a Pensioner on December 5, 1977, shall be eligible for such benefits, subject to all other provisions of this Plan.
Article III A. (8) of the Employer Benefit Plan provides in pertinent part:
Article III – Benefits
A. Health Benefits
Certain benefits provided in this Plan shall be subject to the co-payments set forth below and such co-payments shall be the responsibility of the Beneficiary. The Plan Administrator shall implement such procedures as deemed appropriate to achieve the intent of these co-payments.
Co-payments for Health Benefits are established as follows:
Benefit Co Payment
(a) Physician services as an out- Working Group — $7.50 per
patient as set forth in section A visit up to a maximum of $150
(2) and physician visits in con- per 12-month period(*) per
nection with the benefits set family.
forth in section A(3), paragraph Non-working Group — $5 per
(c) but only for pre- and post- visit up to a maximum of $100
natal visits if the physician per 12-month period(*) per
charges separately for such visits family.
in addition to the charge for
delivery, and paragraphs (g)
through (m), paragraph (n) except
* The 12-month periods shall begin on the following dates: March 27, 1984; March 27, 1985; March 27, 1986 and March 27, 1987.
inpatient surgery, paragraph (o)
and section A(7) paragraph (f).
(b) Prescription drugs and insulin, $5 per prescription or refill
as set forth in section A(4) and up to a $50 maximum per
take-home drugs following a hospi- 12-month period(*) per
tal confinement as set forth in family.
section A(1)(a). Note: For purposes of this
co-payment provision, a
prescription or refill shall
be deemed to be each 30 days
(or fraction thereof) supply.
Article XX Section (c)(3)(i) of the 1984 Wage Agreement requires each signatory Employer to establish and maintain an Employer Benefit Plan to provide health and other non-pension benefits to its Pensioners whose last signatory classified employment was with such Employer. The Wage Agreement stipulates that benefits provided by the Employer pursuant to such Plan shall be guaranteed during the term of the Agreement by that Employer at levels set forth in such Plan.
Article II B. of the Employer Benefit Plan establishes that an individual who is eligible for pension benefits under the UMWA 1974 Pension Plan is eligible for health benefits coverage under the Employer Benefit Plan. Inasmuch as the Complainant was awarded a UMWA 1974 Pension Plan pension effective April 1, 1987, he is entitled to health benefits coverage from his last signatory Employer, the Respondent.
Article III. A (8) of the Employer Benefit Plan specifies the co-payments which are the responsibility of the beneficiary for medical services and prescriptions. Levels of benefits to be provided to Employees, Pensioners and their dependents and survivors are established through collective bargaining and may not be unilaterally changed by an Employer. The Respondent’s use of a non-conforming 80/20 health coverage plan is inconsistent with the provisions of the 1984 Wage Agreement and the Employer Benefit Plan. The Respondent is responsible for providing health benefits coverage for the Complainant as a Pensioner at the level specified in the Employer Benefit Plan, effective April 1, 1987.
Opinion of the Trustees
The Respondent is responsible for providing health benefits coverage for the Complainant as a Pensioner at the level specified in the Employer Benefit Plan, effective April 1, 1987.