Health Care of the Rich
The recent weeks brought a flood of quarterly reports as companies on calendar years rushed to file their 10-Qs with the Securities and Exchange Commission. In that welter of documents, one thing stood out: Even executives are worried who’s going to pay for health care.
Meantime, over at electrical-product and tool-maker Cooper Industries (CBE), sitting Chairman and CEO Krik Hachigian inked a new “Benefits Continuation Agreement,” filed with the company’s 10-Q last week, that guarantees him and his wife lifetime health-care benefits after he retires, and coverage for his children until they turn 26 (though Hachigian must continue to pay premiums as if he were an employee). The document appears to supplant the terms of a “Continuity Agreement” signed on Nov. 30, 2009 (a generic version of which is filed here), which provides for a mere 24 months of coverage — plus another 60 after that as long as the retiree isn’t eligible for Medicare or covered under another plan.
Cooper’s proxy shows that Hachigian made $10.8 million last year alone, including $3.75 million in cash, and he raked in a total of $41.7 million over the last three years, so we doubt he’s seriously worried about making the co-payment for his semi-annual dental cleaning.
Still, the amount of attention and effort that companies and senior executives (and their lawyers) are putting into this issue serves to underscore just how big a deal health-care costs remain going forward.
The italics are mine. BTW, Footnoted is a very good read on corporate news. Like most financial blogs, they get down in the weeds and document the atrocities.