AFA US Airways MEC E-Line - "Staying Informed"

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AFA US Airways MEC E-Line for December 9, 2004

• Bankruptcy Hearing Update
• Health Coverage Tax Credit Information
• Updated PBGC FAQ's and Chart
• Accessing The Hub

• AFA Local Numbers

Bankruptcy Hearing Update

The hearing on the Section 1113 and Pension Termination Motions continued today in the Bankruptcy Court. The company presented testimony from former CFO Dave Davis, as well as from two of the management negotiators who are handling the IAM and CWA negotiations. We expect that the company will complete the presentation of its case tomorrow morning, including testimony concerning negotiations with the AFA, and that the union defenses will start on Friday afternoon. After Friday, the hearing will resume on Tuesday, December 14.

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Health Coverage Tax Credit Information

1. Flight Attendants age 55 and older who are in pay status with the PBGC are eligible. So, no one is eligible until they are retired and have received a check from the PBGC (not the Company). Those Flight Attendants who are eligible will receive a kit from the HCTC Customer Contact Center.

2. The credit covers 65% of eligible premium costs. The credit can be received in full after filing income tax or it can be received monthly as a payment to the health insurer.

3. Spouses and dependents claimed in federal tax returns are also covered under the HCTC. But, once the primary person (the FA receiving the PBGC payment) is eligible for Medicare those claiming through him or her are no longer eligible for the HCTC. Essentially, then, aside from SS disability cases where there may be earlier Medicare eligibility, the HCTC is for 10 years - from age 55 to age 65.

4. The HCTC applies only to premiums paid for "qualified health plans." The following are "automatically qualified health plans" for purposes of the HCTC: COBRA continuation coverage (unless the employer pays 50% or more of the cost, this includes pre-tax payments from the employee); individual coverage provided the FA was enrolled for at least 30 days prior to receiving PBGC payments; state qualified health plans (not all states have a qualified plan. MD, FL, VA, PA, and DC do have plans.); and a spouse's employment-based insurance (unless the employer pays 50% or more of the cost, this includes pre-tax payments from the employee).

5. Pre-existing Conditions: There can be an exclusion for a pre-existing condition only if the FA had less than three months of continuous credible coverage prior to entering the new plan and had a break in coverage longer than 62 days. If the break in coverage is 62 days or less, within the three month period, there can be no exclusion. "Credible coverage" for the HCTC includes a group health plan (including COBRA or State continuation coverage) and Health insurance coverage (including individual coverage, college or school insurance, or short-term limited duration insurance).

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-- Up dated FAQ's about Pension Plan Termination and Payment of Benefits
Pension Plan for Flight Attendants in the Service of US Airways may all be read HERE. --

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