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Delta Air Lines to add $200 monthly health insurance charge for unvaccinated staff

Stock MarketsAug 25, 2021 03:55PM ET
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© Reuters. FILE PHOTO: Delta Air Lines passenger planes are seen parked due to flight reductions made to slow the spread of coronavirus disease (COVID-19), at Birmingham-Shuttlesworth International Airport in Birmingham, Alabama, U.S. March 25, 2020. REUTERS/Elijah

By Rajesh Kumar Singh

CHICAGO (Reuters) -Delta Air Lines on Wednesday said employees will have to pay $200 more every month for their company-sponsored healthcare plan if they choose to not be vaccinated against COVID-19.

The move to add a surcharge to health insurance contributions is the latest tactic by corporate America to push employees to get the shots to fight the pandemic.

A number of U.S. companies, including Delta competitor United Airlines, have mandated shots for their employees to protect their operations from the highly contagious Delta variant of the coronavirus, which has especially hit parts of the country with lower vaccination levels.

President Joe Biden has also urged private businesses to require employees to be vaccinated.

Hours after Delta Air announced the surcharge, Canadian rival Air Canada said https://www.reuters.com/business/aerospace-defense/air-canada-mandates-covid-19-vaccination-all-employees-2021-08-25 workers who are not vaccinated by Oct. 30 will face termination or be sent on unpaid leave. It has also made full vaccination a condition of employment for new employees.

Surging coronavirus infections have clouded the outlook for airline companies. American Airlines (NASDAQ:AAL) said https://www.reuters.com/business/aerospace-defense/american-airlines-warns-august-revenue-rising-covid-19-cases-hit-bookings-2021-08-25 on Wednesday its August revenue was trending below its internal forecast due to a slowdown in bookings and a rise in cancellations.

The comments came two weeks after Southwest Airlines (NYSE:LUV) issued a profit warning https://www.reuters.com/business/aerospace-defense/southwest-airlines-says-may-not-be-profitable-third-quarter-2021-08-11, citing the impact of the Delta variant on its business.

Shares of U.S. airline companies, however, have risen in the past two days on hopes that Monday's full approval of the Pfizer (NYSE:PFE) and BioNTech COVID-19 vaccine by the Food and Drug Administration would drive up the vaccination rate and slow down new infections.

In a staff memo, Delta Air Chief Executive Ed Bastian said the monthly surcharge would take effect on Nov. 1. He said the surcharge is necessary to address the financial risk the Atlanta-based airline faces from the decision to not vaccinate.

Wade Symons, partner and regulatory resources group leader at global consulting firm Mercer, reckons U.S. companies have reached a "tipping point" for taking stricter measures to motivate employees to get vaccinated.

"We anticipate more companies will announce vaccine mandates and surcharges in the coming weeks," he said.

The firm's data shows a quarter of U.S. employers with workforces of 500 or more charge employees extra for company-sponsored healthcare plans if they use tobacco.

Delta Air did not say whether its employees were subject to any other surcharges.

PROOF OF INOCULATION

A Delta Air spokesperson said the average hospital stay for COVID-19 has cost the company $40,000 per person. The surcharge would apply to the entire workforce and proof or documentation of vaccination will be needed to avoid it, the spokesperson said.

Chris Riggins, spokesman for the Air Line Pilots Association at Delta, said the union does not intend to oppose the proposed surcharge because it would not affect the healthcare plan it has negotiated with the airline for its members.

But since most of the pilots are not covered by the union-negotiated plan, Riggins said they would see an increase in their healthcare costs if they decide to remain unvaccinated.

In the memo, Bastian said 75 percent of Delta Air's workforce has been vaccinated. However, all the employees who have been hospitalized with COVID-19 in recent weeks were not fully vaccinated, he said.

While Delta had refrained from making the shots mandatory for its staff, its latest move was in sharp contrast to the policy being pursued by rivals such as American Airlines and Southwest Airlines, which are "strongly encouraging" their employees to get vaccinated.

American Airlines is offering vaccinated employees an additional day off in 2022 and $50 through its employee recognition platform.

Bastian said unvaccinated Delta employees will be required to wear masks in all indoor settings, effective immediately.

Any employee in the United States who is not fully vaccinated will be required to take a COVID-19 test every week. The mandatory testing will start on Sept. 12.

Those who test positive for the virus will be required to isolate and remain out of the workplace, Bastian said.

The company will offer COVID-19 pay protection starting Sept. 30 only to fully vaccinated employees who are experiencing a breakthrough infection, he said.

Delta Air Lines to add $200 monthly health insurance charge for unvaccinated staff
 

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Comments (10)
Michael Angelo
Michael Angelo Aug 25, 2021 9:09PM ET
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Is for insurance, like using the seat belt. Or you think someone on this Corporative country oriented just for profits care about your life or health.
Fred Flintstone
Fred Flintstone Aug 25, 2021 5:49PM ET
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What about the flu shot another vaccinations? This is just another damn way for a Company to make you pay for your insurance in full? How can I get tested to show my antibody counts due to Covid 2 times versus the counts that a experimental shot provides?So they don’t care about their customers getting infected just getting more money from their employees. Sounds like a democrat ran company.
Mark Steadman
Mark Steadman Aug 25, 2021 5:49PM ET
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go whine somewhere else, simp.
John Amicaterra
John Amicaterra Aug 25, 2021 5:03PM ET
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By safe fly Delta airlines Tank You
Mike Mike
Mike Mike Aug 25, 2021 4:17PM ET
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Just let them die
Nelson Manning
Nelson Manning Aug 25, 2021 3:59PM ET
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what about the overweight people and the smokers are you going to hit them with the $200 fee... probably not.. it's okay Delta's on their last leg anyway
Mark Steadman
Mark Steadman Aug 25, 2021 3:59PM ET
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Nah, your disgustingly obese wife is safe, hon.
Roger Miller
Roger Miller Aug 25, 2021 2:04PM ET
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This is why people should not rely on their employers for health insurance any more than the government. Imagine how cheap it would be if we had a truly free and competitive market in health insurance, without government or employer interference.
Francesco Lucchesi
Francesco Lucchesi Aug 25, 2021 1:36PM ET
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it will be hilarious when in winter the vaccinated will end up in ventilators
Felipe Daniel
Felipe Daniel Aug 25, 2021 10:55AM ET
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If vaccinated can pass on the virus how can company approve this?
Deborah Holloway
Deborah Holloway Aug 25, 2021 10:55AM ET
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Because the vaccinated have much much lower chance of being hospitalized, this incurring fewer costs.
HD HD
HD HD Aug 25, 2021 10:55AM ET
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this is for health insurance. you are 70%+ more likely to end up in a hospital being not vaccinated. nothing to do with Delta airlines.
Felipe Daniel
Felipe Daniel Aug 25, 2021 10:55AM ET
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Deborah Holloway I think you are too premature. Pfizer CEO said new variant will be vaccine resistant. What will you do then?
James Shipman
James Shipman Aug 25, 2021 10:42AM ET
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In our company 50% of those who are positive are vaccinated.  I wonder if this will be the same for the flu, eating red meat, driving a gasoline car ...
doug str
doug str Aug 25, 2021 10:42AM ET
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Comparing eating red meat to not getting vaccinated for Covid-19? Yikes!
Rod Quasney
Rod Quasney Aug 25, 2021 10:42AM ET
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I'm sure James was implying that it's about control. If you don't comply to this or that, you will be penaltilized. your lack of comprehension is, Yikes.......
Jeff Pugliese
Jeffro Aug 25, 2021 10:28AM ET
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Yeah but i's ok to smoke 3 packs a day and/or be obese, no extra premium for that, make perfect sense -
Jose Cabreja
Jose Cabreja Aug 25, 2021 10:28AM ET
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🤣🤣🤣
Alejandro Ca
Alejandro Ca Aug 25, 2021 10:28AM ET
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There actually are extra premiums for smoking. Has been in every place I've worked.
HD HD
HD HD Aug 25, 2021 10:28AM ET
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lol. you actually do pay a premium for smoking.
Jeff Pugliese
Jeffro Aug 25, 2021 10:28AM ET
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HD HD  $200/month premium for smoking?  How about being obese? What about a credit if you do Crossfit 4x/week?  Or eat clean? BS
 
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