The U.S. Postal Service plans to stop delivering letters and other first-class mail on Saturdays beginning Aug. 1, although packages will continue to be delivered.
Tired of waiting for Congress to help, the Postal Service later Wednesday is expected to unveil a series of more drastic cuts they plan to pursue that will save them billions of dollars, a spokesperson for the service confirmed.
The taxpayers are paying for retirees to get medical insurance AND the postal retirees ALSO get medicare! They can use both and basically get virtually free medical for life. I say if they get Medicare, then we can save billions of dollars by scraping the retiree medical, it's unnecessary and is just raping the taxpayer, IMO.But the key culprit for the Postal Service's woes has been a 2006 congressional mandate, under which it has to pre-fund healthcare benefits for future retirees. The USPS has been borrowing billions of dollars from taxpayers to make up for the shortfalls.
Two forms of health insurance
Q: I am 68 and a CSRS retiree. What are the advantages of enrolling in Medicare Part A when I am already covered under the FEHB?
A: You want some advantages? First, it’s free. You already paid for it through payroll deductions while you were working. Second, the combination of Medicare Part A and your FEHB plan will reduce or eliminate most of the deductibles and out-of-pocket charges for hospital care. Third, because the two programs don’t always cover the same things or in the same way, they tend to complement each other, giving you better coverage at lower cost.
No Evo, the USPS is about the only service that is fully self funded. Retiree benefits are paid by stamp buyers, not taxpayers.Evo said:I consider this outrageous.
The taxpayers are paying for retirees to get medical insurance AND the postal retirees ALSO get medicare! They can use both and basically get virtually free medical for life. I say if they get Medicare, then we can save billions of dollars by scraping the retiree medical, it's unnecessary and is just raping the taxpayer, IMO.
http://blogs.federaltimes.com/federal-retirement/category/health-insurance/fehbp-and-medicare/
russ_watters said:No Evo, the USPS is about the only service that is fully self funded. Retiree benefits are paid by stamp buyers, not taxpayers.
Of course, when the USPS pension fund collapses, we'll probably bail it out. [typo fixed. -Russ]
Yes, you're right, but they're borrowing billions of dollars from taxpayers to fund it and have already been defaulting. They cannot afford it.russ_watters said:No Evo, the USPS is about the only service that is fully self funded. Retiree benefits are paid by stamp buyers, not taxpayers.
Of course, when the USPS pension fund collapses, we'll probably bail it out.[unfortunate typo fixed. -Russ]
But what should we do about the $46 billion in accrued but unfunded benefits? All the plausible options involve taxpayers covering that bill.
For example, we could privatize the Postal Service and make the buyer take on the retiree health-care obligation. But that would simply reduce the sale price of the post office by $46 billion -- meaning that taxpayers pay.
Or, we could keep the Postal Service in public hands, restructure it so it produces profits and use those profits to gradually amortize the liability. Basically, this is what the 2006 law was supposed to do, though Congress didn't actually give USPS enough flexibility to restructure. This option costs taxpayers, too -- postal profits that would otherwise go to the government would instead be diverted to pay off the retiree health care liability.
Or, Congress could directly subsidize the post office to fund its retiree health-care costs. Obviously, that would put the cost on the backs of taxpayers.
The only way to avoid having taxpayers bail out the USPS is to default on the benefits -- tell current and retired workers that they won't get the benefits they thought they had earned.
Evo said:I consider this outrageous.
The taxpayers are paying for retirees to get medical insurance AND the postal retirees ALSO get medicare! They can use both and basically get virtually free medical for life. I say if they get Medicare, then we can save billions of dollars by scraping the retiree medical, it's unnecessary and is just raping the taxpayer, IMO.
jtbell said:The Postal Service is forbidden by law from raising rates faster than the overall inflation rate.
Jimmy Snyder said:Will PF still be available on Saturdays?
Greg Bernhardt said:Let's go to 3 times a week. Mon, Wed, Fri.
I guess I am alone in being upset that they have already defaulted on 15 billion in taxpayer loans that seem unlikely to be repaid (according to everything I've read) and all due to a retiree health care plan which isn't necessary.Locrian said:I can understand concern over the financial future of the service, but I don’t see how the outrage is warranted.
It was initially just my confusion due to the issue of the retirement health plan being in the news so much the past 2 years. I was tired and thinking it had gone back to being taxpayer funded as opposed to them "borrowing" the taxpayer money to fund it.Locrian said:It isn't clear what you mean by saying their medical plan wasn't necessary. Had medicare been paying primary and the PS been paying less, it just means taxpayers would have had higher Medicare expenses. Since the current health plan was previously (before the prefunding requirement) being funded through postal sales, relying more on medicare would have actually cost taxpayers more.
The USPS does get some taxpayer support. Around $96 million is budgeted annually by Congress for the "Postal Service Fund." These funds are used to compensate USPS for postage-free mailing for all legally blind persons and for mail-in election ballots sent from US citizens living overseas. A portion of the funds also pays USPS for providing address information to state and local child support enforcement agencies.
Evo said:Medicare will still pay the brunt of medical bills for hospitalization and long term care.
Locrian said:I think it’s effectively similar to any retiree group that gets supplemental medical retiree insurance, since either their postal health plan or Medicare will be declared primary and the other will only cover the excess. Even if the postal service doesn’t fulfill the requirement to fund they are still better funded than the majority of private retiree medical plans.
I can understand concern over the financial future of the service, but I don’t see how the outrage is warranted.
The PAEA stipulates that the USPS is to make payments of $5.4 - $5.8 billion into the Postal Service Retiree Health Benefits Fund, each year, from 2007 to 2016 in order to prefund 75 years of estimated costs. This requirement also explicitly stated that the USPS was to stop using its savings to reduce postal debt, which was stipulated in Postal Civil Service Retirement System Funding Reform Act of 2003. This is in addition to deductions from pay for federal contribution to social services. This pre-funding method is unique to the USPS. In June 2011, the USPS had to suspend its weekly payment of 115 million into the fund because it had reached 8 billion dollars in debt and the retirement plan had a surplus of 6.9 billion dollars. The schedule rate of payment has been changed and the USPS is currently expected to make a payment of 5.6 billion no later than September 30, 2012.
Greg Bernhardt said:It's about time! Let's go to 3 times a week. Mon, Wed, Fri. However I suppose this would hurt employment.
http://money.cnn.com/2013/02/06/news/economy/postal-service-cuts/index.html?hpt=hp_t1
Evo said:It was initially just my confusion due to the issue of the retirement health plan being in the news so much the past 2 years. I was tired and thinking it had gone back to being taxpayer funded as opposed to them "borrowing" the taxpayer money to fund it.
Medicare will still pay the brunt of medical bills for hospitalization and long term care.
I'm not sure if we should start a new thread discussing the USPS situation or leave here since the delivery change is part of trying to save money.
The USPS does receive ~ 96 million dollars of taxpayer money each year that goes into the "Postal Service Fund", but it's purpose is not to fund retiree pensions.
http://usgovinfo.about.com/od/consumerawareness/a/uspsabout.htm
Yes, did you read the article posted in the OP?Alfi said:Does this have anything to do with the topic?
Postal Service stops Saturday mail delivery.
Yes, I should have you write my posts for me. :tongue2:boomtrain said:I think the outrage is over the suspicion that the postal service's retiree medical plan will be bailed out if it comes up short, while private plans (for anyone other than GM and Chryslter!) won't get that kind of taxpayer support.
Evo said:Yes, did you read the article posted in the OP?
Medicare will still pay the brunt of medical bills for hospitalization and long term care.
Tired of waiting for Congress to help, the Postal Service on Wednesday unveiled its plan, which is expected to save $2 billion a year. It's a drop in the bucket, compared to the $16 billion loss the organization reported for 2012.
"It's a responsible decision. It makes common sense," said Patrick Donahoe, postmaster general and CEO of the postal service.
Because they have a retirement health plan that could end up being funded by tax payers (if the situation doesn't change) and then also be eligible for taxpayer funded medicare. Since they are eligible for medicare, there is no reason to also have a second health plan if it turns out the taxpayers will need to bail it out. You do realize that it's the problem with funding the healthcare for retirees that is the reason they are cutting back on saturday deliveries? Eliminating their retiree health care plan (which is being proposed as a solution) wouldn't be a problem, IMO, since they will have Medicare.Alfi said:Yes I did. Thanks for asking. Should I ask it of you as well?
I am confused how medicare has anything to do with a one day delay in snail mail.
What I did not read was anything to do with medicare.
Evo said:Because they have a retirement health plan that could end up being funded by tax payers (if the situation doesn't change) and then also be eligible for taxpayer funded medicare. Since they are eligible for medicare, there is no reason to also have a second health plan if it turns out the taxpayers will need to bail it out. You do realize that it's the problem with funding the healthcare for retirees that is the reason they are cutting back on saturday deliveries?
no, I did not realize that. I never realized that ending a Saturday delivery of snail mail is going to produce these problems.You do realize that it's the problem with funding the healthcare for retirees that is the reason they are cutting back on saturday deliveries?
Ending Saturday delivery is simply a way of cutting back expenses, it is not the cause of problems. Please read the articles provided, they will explain why the postal service is in dire financial trouble.Alfi said:no, I did not realize that. I never realized that ending a Saturday delivery of snail mail is going to produce these problems.
boomtrain said:I think the outrage is over the suspicion that the postal service's retiree medical plan will be bailed out if it comes up short, while private plans (for anyone other than GM and Chryslter!) won't get that kind of taxpayer support.
turbo said:IMO, the current troubles at USPS can be traced back to PAEA, which requires the postal service to pay over $5B a year to pre-pay the service's retirement accounts for 75 years.
The main reason for the Postal Service to stop Saturday mail delivery is to cut costs. With the rise of digital communication, there has been a decline in the volume of mail being sent, making it financially unsustainable for the Postal Service to continue delivering mail on Saturdays.
Yes, all types of mail will be affected by the Saturday mail delivery stop. This includes letters, packages, and priority mail. However, packages sent through Priority Mail Express will still be delivered on Saturdays.
This change may have a significant impact on businesses and individuals who rely on Saturday mail delivery. They may need to adjust their mailing schedules or find alternative delivery options to ensure timely delivery of important documents or packages.
The Postal Service has announced that Saturday mail delivery will officially stop on August 1, 2020. This date may be subject to change depending on any future developments or decisions made by the Postal Service.
Yes, there are a few exceptions to the Saturday mail delivery stop. These include mail delivery to P.O. boxes, mail delivery to remote and rural areas, and mail delivery for businesses that have special agreements with the Postal Service for Saturday delivery.