HACKENSACK, N.J. — Robert Greenberg of Paramus, N.J., decided to retire early from Allied Signal because he had seen his father die of cancer before ever having a chance to enjoy retirement. The same had happened to his grandfather.

Greenberg, a former engineering manager who helped build test equipment for F-15 fighter jets at Bendix Aviation in Teterboro, N.J., vowed not to let that happen to him. He retired about 16 years ago at age 51 with a pension and an employer-provided health insurance package he thought would be with him for life.

Additional Photos

Retiree Robert Greenberg, 68, relies on the drug Revlimid to treat bone marrow cancer. He now pays $400 a year out of pocket for the drug, and he’s losing health benefits soon. McClatchy Newspapers

Robert Greenberg retired in 1994 because both his father and grandfather had died of cancer before having a chance to enjoy retirement. He takes the drug Revlimid for the cancer with which he was diagnosed in 2001. MCT

“I had a family history of medical issues. That’s why I retired early,” he said. “I was promised I would be getting medical insurance; it was a big part of my retirement benefits.”

The number of companies offering retiree benefits has been dwindling for more than 20 years. According to the 2010 health benefits survey by the Kaiser Family Foundation and the Health Research and Educational Trust, only 28 percent of companies with 200 or more workers that offer health benefits to their employees also offer retiree coverage, down from 66 percent in 1988.

A change in accounting standards spurred a rash of retiree health-care benefit cuts beginning in the late 1980s, said Tricia Neuman, vice president and director of the Medicare Policy Project at the Kaiser Family Foundation. Corporations were required to book on their balance sheets their future liability from retiree health benefits, she said, and that affected bottom lines.

“Employers took a number of steps to reduce liability, many of which shift the cost on to retirees in the form of higher premiums or higher cost-sharing requirements,” Neuman said. “Some employers have maintained coverage for current retirees but stopped offering it for new hires.”

Greenberg was one of many retirees who learned in August that beginning Jan. 1, Honeywell International — which had merged with Allied Signal after Allied bought Bendix in 1983 — will no longer provide health insurance for Medicare-eligible employees who retired after July 1992. Their group plans will be terminated, and they were referred to a third-party benefits adviser that is helping them choose individual plans to supplement their Medicare coverage.

Greenberg was diagnosed in 2001 with multiple myeloma, a bone marrow cancer. A very expensive drug, Revlimid, “is keeping me alive,” he said. He expects that with the loss of his company-provided drug plan, his out-of-pocket costs will skyrocket to more than $9,000 a year from $400.

Honeywell declined recently to comment on Greenberg’s situation, but said in a written statement that “retirees will continue to have access to medical insurance, and for many at a lower cost.”

U.S. companies almost always reserve in writing the right to change retiree health plans. When they do, nothing in federal or state law prevents them from cutting or eliminating such benefits. It can be more difficult when union contracts are involved.

Federal health care legislation passed this year will remove one of two provisions in the 2003 law creating Medicare Part D drug coverage that were intended as incentives for employers to continue offering retiree health benefits as availability of Medicare coverage was expanded. A subsidy that covered 28 percent of employers’ retiree health expenses remains in place, but related tax deductions will end in 2013.

Neuman said that “it is not clear yet” whether the new tax treatment will affect employers’ decisions to continue offering benefits.

The health care law also includes a temporary $5 billion reinsurance fund to help employers pay health benefits for retirees age 55 through 64 who do not yet qualify for Medicare. The assistance will be available until 2014, when the option of state-run health exchanges are supposed to be up and running.

“Those younger than 65 can find it difficult to find affordable coverage,” she said.

Retiree advocates believe the removal of the tax break for employers will prompt another round of retiree health plan slashing in coming years.

“Next year they will be dropping like flies; the health care reform has made it easy for companies to drop their plans and blame it on Uncle Sam,” said Jack Cohen, a board member for the Association of BellTel Retirees, who also volunteers for the lobbying group ProtectSeniors.org.

Those groups have for years been pushing for federal legislation that would make it illegal for profitable companies to cut retirees’ health benefits.

“If we can get this bill passed, we will see it continue for people who were promised they would get it,” said Jack Brennan of Hillsdale, N.J., who is chairman of the BellTel retiree group. Brennan started working for Verizon predecessor New Jersey Bell in 1953 at age 17 and was a labor relations manager when he retired in 1991. He said that for most of Verizon’s retirees, the company drug coverage plan is better than Medicare Part D.

“The important thing we are trying to do is stop the company from canceling health care in its entirety,” he said. “Obama’s medical plan has forgotten about retirees. His favorite thing to say was, ‘If you like what you have, you can keep it.’ But if the company is going to take it away, you certainly can’t keep it.”

The proposal to require companies to maintain retiree health care programs was to be included in the health care legislation package but “was one of the last items to get cut out,” Brennan said. “If we got a few more Republicans to support it, we would have gotten it in.”

With the new Congress, he is hopeful the bill will get passed next year. “I think we have a different chance now; we are hopeful we will bring some Republicans to our side of the aisle,” he said.

Related Stories