Lifetime insurance not realistic
While the NFL Players Association has taken heat from former players for red tape involving disability claims and lack of pension increases, the union did investigate the idea of providing medical insurance for players until they are 65 years old.
The conclusion from that study, which was conducted by the Towers Perrin consulting firm, was bleak. In March 2005, NFLPA director of benefits Miki Yaras-Davis informed all of the player reps of the 40-year estimate.
It was a $16.2 billion charge just to cover currently active players who qualified and the following wave of players who would qualify over that period until they reach 65 years of age. To qualify, players must have been in the NFL for at least three seasons – generally putting them at the age of 25 when they reach eligibility.
Towers Perrin calculated that in order to fund that immediately, the NFLPA would have had to give the firm $3.1 billion in 2005, Towers Perrin senior consultant Rob Schlau said.
"That assumes our ability to get a six percent return on the money and factors in increases in healthcare costs, among other factors," Schlau said. "It's a staggering amount of money."
How staggering? That $3.1 billion figure was approximately the same amount of money that was spent on player salaries that season. In other words, every player in the NFL in 2005 would have had to play for free to fund health insurance over the next 40 years.
That fund would also not cover former players who retired prior to the plan's possible inception. In short, none of the retired players currently clamoring for increased benefits would have received the coverage.
"When I brought the figures into the meeting, it was a pretty short conversation," said Yaras-Davis, who has been with the union for 29 years. "I said, ‘You can give me all the money and we're fine.' It got really quiet after that."
The NFLPA currently provides qualifying players five years of medical coverage upon retirement, 18 months of COBRA coverage and gives players $25,000 per year up to 12 years ($75,000 minimum, $300,000 maximum) to pay for insurance or other medial issues.
