Postretirement benefits other than pensions

We provide health care and life insurance benefits to certain retired employees who meet age and service requirements. Most of our retirees contribute to the cost of these benefits and retiree contributions are increased as actual benefit costs increase. The cost of providing retiree health care and life insurance benefits is actuarially determined. Our policy is to fund benefits as claims and premiums are paid. Commencing July 1, 2014, for certain Medicare-eligible retirees, our approach to deliver postretirement healthcare moved to a private retiree exchange. For those individuals, we began providing a stipend which is accessible through a Health Reimbursement Account. We eliminated postretirement medical and life insurance benefits for most U.S. employees under 50 years of age effective Jan. 1, 2006. We use a Dec. 31 measurement date for these plans.

Postretirement benefit cost for health care and life insurance included the following components:



In thousands of dollars
	2014			2013			2012
Service cost – benefits earned during the period	$	369		$	529		$	545
Interest cost on net benefit obligation	4,711			5,656			7,744
Amortization of prior service credit	(11,648		)	(9,165		)	(19,190		)
Amortization of actuarial loss	758			1,169			1,943
Net periodic postretirement benefit credit	$	(5,810	)	$	(1,811	)	$	(8,958	)

The table below provides a reconciliation of benefit obligations and funded status of our postretirement benefit plans:



In thousands of dollars
	Dec. 28, 2014			Dec. 29, 2013
Change in benefit obligations
Net benefit obligations at beginning of year	$	146,809		$	169,592
Service cost	369			529
Interest cost	4,711			5,656
Plan participants’ contributions	5,133			9,629
Plan amendments	(37,986		)	(496		)
Actuarial loss (gain)	6,954			(16,476		)
Gross benefits paid	(18,739		)	(28,022		)
Federal subsidy on benefits paid	683			4,169
Acquisitions	—			2,228
Net benefit obligations at end of year	$	107,934		$	146,809
Change in plan assets
Fair value of plan assets at beginning of year	$	—		$	—
Employer contributions	13,606			18,393
Plan participants’ contributions	5,133			9,629
Gross benefits paid	(18,739		)	(28,022		)
Fair value of plan assets at end of year	$	—		$	—
Benefit obligation at end of year	$	(107,934	)	$	(146,809	)
Amounts recognized in Consolidated Balance Sheets
Accrued benefit cost—current	$	(10,286	)	$	(17,731	)
Accrued benefit cost—noncurrent	$	(97,648	)	$	(129,078	)

The following table summarizes the amounts recorded in accumulated other comprehensive income (loss) that have not yet been recognized as a component of net periodic postretirement benefit credit as of the dates presented (pre-tax):



In thousands of dollars
	Dec. 28, 2014			Dec. 29, 2013
Net actuarial losses	$	(12,594	)	$	(6,087	)
Prior service credit	42,542			16,204
Amounts in accumulated other comprehensive income (loss)	$	29,948		$	10,117

The actuarial loss and prior service credit estimated to be amortized from accumulated other comprehensive loss into net periodic benefit cost in 2015 are $1.5 million and $10.0 million, respectively.

Other changes in plan assets and benefit obligations recognized in other comprehensive (loss) consist of the following:



In thousands of dollars
	2014
Current year actuarial loss	$	(7,265	)
Change in prior service cost	37,986
Amortization of actuarial loss	758
Amortization of prior service credit	(11,648		)
Total	$	19,831

Postretirement benefit costs: The following assumptions were used to determine postretirement benefit cost:



	2014		2013		2012
Discount rate	4.50	%	3.80	%	4.75	%
Health care cost trend rate assumed for next year	6.26	%	7.17	%	6.50	%
Ultimate trend rate	5.00	%	5.00	%	5.00	%
Year that ultimate trend rate is reached	2018		2017		2016

Benefit obligations and funded status: The following assumptions were used to determine the year-end benefit obligation:



	Dec. 28, 2014		Dec. 29, 2013
Discount rate	4.00	%	4.75	%
Health care cost trend rate assumed for next year	6.26	%	7.17	%
Ultimate trend rate	5.00	%	5.00	%
Year that ultimate trend rate is reached	2018		2017

Assumed health care cost trend rates have an effect on the amounts reported for the health care plans. The effect of a 1% change in the health care cost trend rate would result in a change of approximately $0.3 million in the 2014 postretirement benefit obligation and no measurable change in the aggregate service and interest components of the 2014 expense.

Cash flows: We expect to make the following benefit payments, which reflect expected future service, and to receive the following federal subsidy benefits as appropriate:



In thousands of dollars	Benefit Payments
2015	$	10,287
2016	$	9,109
2017	$	8,502
2018	$	8,578
2019	$	7,970
2020-2023	$	32,087

The amounts above exclude the participants’ share of the benefit cost. Our policy is to fund benefits as claims, stipends and premiums are paid. We expect no subsidy benefits for 2015 and beyond.