The House of Representatives voted Feb. 5 to remove a mandate that the U.S. Postal Service prefund its retiree healthcare, a requirement that has been responsible for significant financial losses at the agency.
“This mandate has cost the postal service billions of dollars since it was first imposed 14 years ago. The Postal Service has not made a payment into this fund since 2012,” Rep. Carolyn Maloney, D-N.Y., said on the House floor.
“Without major structural reforms, the Postal Service will run out of cash in about four years. At that point, it will not be able to pay its own workers and mail delivery would simply cease.”
USPS has reported consistent losses in recent years, most recently a net loss of $8.8 billion for fiscal year 2019. Much of those losses can be attributed to the defaulting on prefunding payments, which amount to about $5 billion per year.