August 11, 2006

 

Dear Delta Retiree, Spouse or Survivor:

 

On August 9, 2006, Delta Air Lines made a proposal to the Delta 1114 Non Pilot Bankruptcy Committee to eliminate or reduce retiree health care benefits available to retirees, spouses, dependents and survivors based on age. The proposed changes would not become effective any earlier than January 1, 2007.

 

The retiree, spouse and survivor healthcare benefits impacted by these proposed changes are:

 

Ø      Elimination of the Delta Family-Care Medical Care Plan, including the medical, dental and vision options, for retirees, spouses and survivors over the age of 65 since they are Medicare eligible . There will be access to healthcare insurance, including medical, dental and vision options and including coverage supplemental to Medicare, for all retirees, their spouses and survivors if you are over 65 but it will not be under the Delta Family-Care Medical Plan and may be at the retirees cost.

Ø      A subsidy to a group of the oldest retirees, spouses and survivors

Ø      Elimination of “free” Premiums for retirees, spouses and survivors under the age of 65 that are recipients of the early retirement programs “Pension Plus” and “ERMO”.

Ø      Increases to the premium percentage paid by Pre65 retirees, spouses and survivors in other retirement and early retirement programs, of which there are many, which are not currently paying 100% of their premium.

Things we do not know:

 

Ø      At this time, we do not know what, if any, changes will be proposed to the benefits enrollment for 2007 relating to out of pocket cost, copays and prescription drug coverage for those retirees, spouses or survivors that are under the age of 65. That information will be forthcoming in the near future.

Ø      We do not know the level of increase of premiums for people under 65 at this point of the negotiation with Delta.

Ø      We do not know exactly who will be eligible for a portion of their over 65 medical premium subsidy at this point of the negotiation with Delta

Ø      We do not know when we will reach agreement with Delta on these proposed changes however we will work very hard to reach an agreement in a timely manner.

 

Things we know that will not be eliminated or changed at the present time by Delta:

 

Ø      Basic Life Insurance and Survivor Income benefits

Ø      The availability to continue to have access to other types of insurance coverage at 100% of the cost that includes Accidental, Additional Life Insurance and Spouse Life coverage.

 

Over the last 6 months the non-pilot Section 1114 committee has done substantial preparation for these negotiations with Delta. We hope to preserve critical health care benefits for retirees at an affordable cost while reaching an agreement with Delta which meets their goal of reaching viability,. Although any final agreement with Delta may look quite different from Delta’s initial proposal, retirees should understand that all retirees will be paying something for their medical care, and almost all retirees will be facing higher costs. Your 1114 Committee is working to mitigate those cost increases but we want you to begin now planning for an increase to your current healthcare expense as that cost will likely increase.

 

The non-pilot 1114 Committee told Delta we would review the proposal over the next few weeks, and provide a counter proposal. Once again, we want to stress, any final health care program will include access to health care for all retirees, including insurance supplemental to Medicare coverage.

 

We would also like to remind you that any claims that may arise out of changes to benefits after our negotiations with Delta are exempt from the current bar date order deadline of August 21, 2006. That bar date does not pertain to any possible claims due to reductions in healthcare programs after the bankruptcy filing. . There will be a future communication before any need to file a proof of claim over health benefit changes.

 

As we go further in these negotiations, the Non-Pilot 1114 Committee or its attorneys may want to contact you about any hardship Delta’s ultimate proposal may create for you or in setting our priorities for preserving benefits, therefore it is important to go to the 1114 Committee Web site at www.delta1114.org if you have computer access or to send us a letter with your update information so that we will be able to contact you in a timely manner.

 

We realize these changes will pose a hardship to some and we are working with Delta to make sure you receive the best healthcare possible for a price you can afford to pay.

 

Sincerely,

 

Non Pilot Delta 1114 Committee

 

Cathy Cone, John Hoover, Thea Cohen, Bob Adams, Barry Braender, Bill Hutcheson

 

Advisory Committee: Hollis Harris, Maurice Worth, Mike Podett, Thom Stone