Raley's Canceling Retiree Coverage

ELLIOT ZWIEBACH

WEST SACRAMENTO, Calif. — Raley's Supermarkets here said it has decided to stop providing health care coverage to retired hourly employees 65 and older, effective July 1.

Raley's has arranged for retirees to receive a group rate on insurance plans sponsored by the chain from Hartford and Kaiser Permanente, which offer similar coverage to the existing Raley's plan but at higher monthly costs.

"Most employers today do not provide medical benefits in retirement," said Jerry Landers, senior director of human resources. "In fact, only about 20% of employers do, and this number continues to decrease.

"Raley's has taken a hard look at this and decided that, due to the economic downturn and increasing cost of providing medical coverage, we will be discontinuing this benefit for retirees who are over the age of 65 — the time at which they become Medicare-eligible."