Rapid increases in the cost for retiree health coverage have led employers to increase retiree premium contributions and cost sharing. In some cases where firms have capped their future liability toward retiree health care costs (see Exhibits 2.10 and 2.11), firms may increase cost sharing as a way of keeping contribution levels more affordable for retirees, who pay for most or all of retiree benefit cost increases.

Notes: Based on responses from private-sector firms with 1,000 or more employees that offer retiree health benefits.

Source: Kaiser Family Foundation/Hewitt Associates, Current Trends and Future Outlook for Retiree Health Benefits: Findings from the Kaiser/Hewitt 2004 Survey on Retiree Health Benefits, December 2004, Exhibits 23 and 24, at http://www.kff.org/medicare/7194/retiree_ben_sec5.cfm.