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Postal Service Might Drop Health Insurance Plans

Posted Aug 11 2011 9:30pm

The US Postal Service has been struggling financially for years, and new proposals to cut costs have postal unions very frustrated.  The article “Postal Service Proposes Cutting 120,000 Jobs, Pulling Out of Health-Care Plan” by Joe Davidson on WashingtonPost.com discusses some of the details involved in the new proposals.

One of the most upsetting parts of the new proposals is that the Postal Service is looking to cut their workforce by up to 20% leaving many unemployed.  The layoffs would occur by breaking labor agreements which is particularly upsetting for labor unions.  This proposal does need congressional approval and if it goes through it could have ripple effects throughout government including a big blow to the US labor movement.

The other nerve-wracking aspect of the proposal is the plan to cut the federal health insurance and retirement plans because the Postal Service believes they can offer services at cheaper costs.  This could leave costs much higher for the postal workers and potentially lead people to shop around for their own individual health insurance policies.  These proposals are designed to save the postal service and continue to provide for the public.  During the last four years, the postal service has lost about $20 billion and mail volume has dropped by around 20%.  These numbers are having devastating effects on their bottom line.

Written by Sam Tabes

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