I know next to nothing about the rules surrouding retirement/disability benefits, so I’m hoping those of you with more experience can offer your insights in order to help me make a more informed decision.
The situation: my dad is on long-term disability from Lucent Technologies (now Lucent-Alcatel) with multiple sclerosis. He recently got a letter from them stating that they were cancelling his medical coverage. Prior to this, the terms of his long-term disability were that he would have the same health insurance he’d had as an employee until he was 65. I called the benefits center, and was told that they had “changed the contract” last year and are now allowed to cancel the health coverage of employees on long-term disability. I asked how that was legal, and the guy said he didn’t know the details, but he knew they had done everything by the book so it was legal.
So my main question is: how is this legal? If companies can legally cancel the promised benefits of retirees after the fact, why would they ever pay them? Why not just cancel everyone’s retirement benefits?
Follow-up question: is there any way to fight this short of getting a lawyer and taking them to court? If not, is a legal battle pretty much hopeless for a regular schmo? I’m guessing they wouldn’t have done this unless they thought it was legally defensible, especially against the resources a couple on disability has to throw at them.
As you can imagine, I’m pretty irked, but it’s far more important to me to help my parents make the most pragmatic financial decision than to battle solely based on principle and right vs. wrong.