Citing rising operating costs, Barrick Gold Corp. will cancel the Homestake Retiree Medical Plan, leaving about 1,000 retirees without the benefit.
Cara Horton, benefits manager with Barrick Gold Corp., said Homestake retirees who are at least 65 or older will lose the company’s retiree medical plan at the end of this year. That includes about 800 retirees. About 200 former employees who are not yet 65 will lose the benefits next year.
Horton said Barrick Gold Corp. will issue one-time subsidy checks that are intended to help offset the cost to purchase private health insurance for one year.
“Like most companies we are looking for ways to control medical costs and costs in general,” Horton said. “Part of that is a review of plans that we inherited through other companies like Homestake, which we acquired in 2001. This retiree medical plan is high cost. It is a supplement plan to other plans they may have, including Medicare.”
The Homestake Retiree Medical Plan was provided free of charge. It included free basic medical coverage for services provided at Lead-Deadwood Regional Hospital in Deadwood, Sturgis Regional Hospital, Lead-Deadwood Regional Medical Clinic in Deadwood, Spearfish Regional Medical Clinic, Belle Fourche Regional Medical Clinic and the Newell Regional Medical Clinic.
The plan also included vision coverage.
But since the plan strictly limited the hospitals and clinics where retirees could receive care, many of them say they had already acquired other insurance. The change, some say, won’t affect them very much at all.
“There has been very little help from Homestake/Barrick health insurance, except for the eyes,” said Ron Gengler, who worked for Homestake for 40 years and who has been retired for more than 20 years. “The eyes were the only thing we did regularly that they helped pay for. I got Humana and they have been wonderful. We are not affected (by this) in any way, shape or form. It would be nice to get a check from them. I’ll take my wife out to dinner.”
Jim Dunn, who also worked for Homestake for many years, said he and his wife Betty Dunn also have supplemental insurance through Blue Cross/Blue Shield, which gives them the flexibility to seek care outside of the Northern Hills.
That story is one that many retirees throughout the Northern Hills told off the record. From Medicare to private health insurance coverage, many residents are still covered under other plans.
“Most of them are triple insured,” Horton said. “So they’re actually over insured.”
Other retirees, who did not wish to go on the record, were also very disappointed about the change.
But, Horton said the former Homestake employees were told that the plan, which carries such major limitations, may not always be in place.
“They were told at one time that this was a benefit that could go away,” Horton said. “The plan is limited to just a handful of clinics and hospitals in the area,” Horton said. “So if any of them have conditions that require major care that they have to get at the Rapid City hospital, that is not covered under the plan.”
Horton added that contrary to recent unofficial reports, the Homestake Retiree Medical Plan was not a union-negotiated plan. Therefore, she said, Barrick is fully within their rights to cancel it.
Additionally, Horton said that there are some retirees who no longer live in the Black Hills area, who cannot use the plan anyway. According to Horton, about 85 percent of those who receive the Homestake Retiree Medical Plan, live within a 75-mile radius of the Black Hills.
Though gold prices have been at record highs, at more than $1,700 per troy ounce, Barrick Gold spokesman Lou Schack said the company’s operating costs are also quite high. Medical and insurance costs have been rising exponentially for more than a decade, he said, along with the price of fuel, labor and tires.
“It’s important that we control costs as we can,” he said.