March 26 (Bloomberg) -- AT&T Inc. will book $1 billion in first-quarter costs related to the health-care law signed this week by President Barack Obama, the most of any U.S. company so far.
A change in the tax treatment of Medicare subsidies triggered the non-cash expense, and the company will consider changes to the benefits it offers current and retired workers, Dallas-based AT&T said today in a regulatory filing.
AT&T, the biggest U.S. phone company, joins Caterpillar Inc., AK Steel Holding Corp. and 3M Co. in recording non-cash expenses against earnings as a result of the law. Health-care costs may shave as much as $14 billion from U.S. corporate profits, according to an estimate by benefits consulting firm Towers Watson. AT&T employed about 281,000 people as of the end of January.
Your phone bill will be going up and Caterpillar, AK Steel and 3M will be raising their prices. This will make them less competitive in the export market and impact any one else who does business with them. Although not announced it will do the same thing to Verizon, Alcatel and all other employers.
This means loss of business and loss of jobs.
Thanks Lefties. The country doesn't need jobs but Obamie needed a "legacy."
“Companies like AT&T, that have large employee bases, are going to have higher health-care costs and, therefore, lower earnings unless they can negotiate something or offer less to their employees,” said Chris Larsen, an analyst at Piper Jaffray & Co. in New York, who rates AT&T shares “overweight” and doesn’t own any himself.
AT&T previously received a tax-free benefit from the government to subsidize health-care costs for retirees, who would otherwise be on a Medicare Part D plan. Under the new bill, AT&T will no longer be able to deduct that subsidy.
“As a result of this legislation, including the additional tax burden, AT&T will be evaluating prospective changes to the active and retiree health-care benefits offered by the company,” the carrier said in the filing.
You can expect ATT to dump the retiree plans forcing them into Medicare. Alcatel has already changed their plan and you can expect others to follow. This further degrades Medicare and will force price increases on seniors who can barely survive now.
The active employees will also see their insurance costs go up and/or benefits go down. This is an effective pay cut in disposable income. Something else that the country does not need at this time.
I wonder how many of the Obamabots who voted for him will be smart enough to understand how bad he has just screwed them.
Thanks Obamie. Your care and concern for the country speaks for itself. You should be impeached for the harm caused.
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