Other Postretirement Benefits

We provide health benefits to retired employees (and their eligible dependents) who meet the definition of an eligible participant and certain age and service requirements, as outlined in the plan document. While we offer pre-age 65 retiree medical coverage to employees who meet certain retiree medical eligibility requirements, we no longer provide post-age 65 retiree medical benefits for employees who retired on or after March 1, 2009. We also contribute to a postretirement plan under the provisions of a collective bargaining agreement. We accrue the costs of postretirement benefits during the employees’ active years of service and our policy is to pay our portion of insurance premiums and claims from our assets.

In January 2012, we sold the Regional Media Group. The sale significantly reduced the expected years of future service for current employees, resulting in a remeasurement and curtailment of a postretirement benefit plan. We recognized a curtailment gain of $27.2 million in the first quarter of 2012, which is included in the gain on the sale within “(Loss)/income from discontinued operations, net of income taxes” in the Consolidated Statement of Operations.

In October 2011, we amended our retiree medical plan by, among other things, placing a cap (effective January 1, 2012) on our contributions for certain retiree groups. In connection with this plan amendment, we remeasured our postretirement obligation as of the plan amendment date. The plan amendment and remeasurement resulted in a decrease in the postretirement liability and an increase in other comprehensive income (before taxes) of approximately $20 million in October 2011.

The Patient Protection and Affordable Care Act, which was enacted on March 23, 2010, and the Health Care and Education Reconciliation Act of 2010, which was enacted on March 30, 2010, eliminated the tax deductibility of certain retiree health care costs, beginning January 1, 2013, to the extent of federal subsidies received by plan sponsors that provide retiree prescription drug benefits equivalent to Medicare Part D. Because the future anticipated retiree health-care liabilities and related subsidies are already reflected in our financial statements, this legislation required us to reduce the related deferred tax asset recognized in our financial statements. As a result, we recorded a tax charge of $11.4 million in 2010 for the reduction in future tax benefits for retiree health benefits. The impact of this legislation was not material and was included in our 2010 year-end measurement of our postretirement benefits obligation.

The components of net periodic postretirement benefit income were as follows:



(In thousands)	December 30, 2012			December 25, 2011			December 26, 2010
Service cost	$	957		$	1,143		$	1,076
Interest cost	4,985			6,890			9,340
Recognized actuarial loss	3,328			2,289			3,129
Amortization of prior service credit	(15,112		)	(16,593		)	(15,602		)
Effect of curtailment	(27,213		)	—			—
Net periodic postretirement benefit income	$	(33,055	)	$	(6,271	)	$	(2,057	)

The changes in the benefit obligations recognized in other comprehensive loss were as follows:



(In thousands)	December 30, 2012			December 25, 2011			December 26, 2010
Net actuarial loss/(gain)	$	11,562		$	13,436		$	(16,865	)
Prior service credit	—			(35,712		)	—
Amortization of loss	(3,328		)	(2,289		)	(3,129		)
Amortization of prior service credit	15,112			16,593			15,602
Recognition of prior service credit due to curtailment	27,213			—			—
Total recognized in other comprehensive loss/(income)	50,559			(7,972		)	(4,392		)
Net periodic postretirement benefit income	(33,055		)	(6,271		)	(2,057		)
Total recognized in net periodic postretirement benefit income and other comprehensive loss	$	17,504		$	(14,243	)	$	(6,449	)

The estimated actuarial loss and prior service credit that will be amortized from accumulated other comprehensive loss into net periodic benefit cost over the next fiscal year is approximately $4 million and $15 million, respectively.

In connection with collective bargaining agreements, we contribute to several multiemployer welfare plans. These plans provide medical benefits to active and retired employees covered under the respective collective bargaining agreement. Contributions are made in accordance with the formula in the relevant agreement. Postretirement costs related to these plans are not reflected above and were approximately $18 million in 2012, $16 million in 2011 and $18 million in 2010.

The changes in the benefit obligation and plan assets and other amounts recognized in other comprehensive income/loss were as follows:



(In thousands)	December 30, 2012			December 25, 2011
Change in benefit obligation
Benefit obligation at beginning of year	$	113,803		$	142,417
Service cost	957			1,143
Interest cost	4,985			6,890
Plan participants’ contributions	4,383			4,659
Actuarial loss	11,562			13,436
Plan amendments	—			(35,712		)
Benefits paid	(15,881		)	(20,247		)
Medicare subsidies received	957			1,217
Benefit obligation at the end of year	120,766			113,803
Change in plan assets
Fair value of plan assets at beginning of year	—			—
Employer contributions	10,541			14,371
Plan participants’ contributions	4,383			4,659
Benefits paid	(15,881		)	(20,247		)
Medicare subsidies received	957			1,217
Fair value of plan assets at end of year	—			—
Net amount recognized	$	(120,766	)	$	(113,803	)
Amount recognized in the Consolidated Balance Sheets
Current liabilities	$	(10,419	)	$	(9,611	)
Noncurrent liabilities	(110,347		)	(104,192		)
Net amount recognized	$	(120,766	)	$	(113,803	)
Amount recognized in accumulated other comprehensive loss
Actuarial loss	$	51,348		$	43,114
Prior service credit	(94,144		)	(136,469		)
Total	$	(42,796	)	$	(93,355	)

Weighted-average assumptions used in the actuarial computations to determine the postretirement benefit obligations were as follows:



	December 30, 2012		December 25, 2011
Discount rate	3.49	%	4.64	%
Estimated increase in compensation level	3.50	%	3.50	%

Weighted-average assumptions used in the actuarial computations to determine net periodic postretirement cost were as follows:



	December 30, 2012		December 25, 2011		December 26, 2010
Discount rate	4.64	%	5.14	%	5.92	%
Estimated increase in compensation level	3.50	%	3.50	%	3.50	%

The assumed health-care cost trend rates were as follows:



	December 30, 2012		December 25, 2011
Health-care cost trend rate assumed next year	8.00	%	7.33	%
Rate to which the cost trend rate is assumed to decline (ultimate trend rate)	5.00	%	5.00	%
Year that the rate reaches the ultimate trend rate	2023		2019

Because our health-care plans are capped for most participants, the assumed health-care cost trend rates do not have a significant effect on the amounts reported for the health-care plans. A one-percentage point change in assumed health-care cost trend rates would have the following effects:



	One-Percentage Point
(In thousands)	Increase		Decrease
Effect on total service and interest cost for 2012	$	130	$	(121	)
Effect on accumulated postretirement benefit obligation as of December 30, 2012	$	2,669	$	(2,460	)

The following benefit payments (net of plan participant contributions) under our Company’s postretirement plans, which reflect expected future services, are expected to be paid:



(In thousands)	Amount
2013	$	10,652
2014	10,261
2015	9,779
2016	9,456
2017	9,149
2018-2022	39,388

We accrue the cost of certain benefits provided to former or inactive employees after employment, but before retirement, during the employees’ active years of service. Benefits include life insurance, disability benefits and health-care continuation coverage. The accrued cost of these benefits amounted to $19.9 million as of December 30, 2012 and $20.3 million as of December 25, 2011.