BizNomic

The latest addition to the mounting list of U. S. companies that have been hit by the new health care law is AT&T Inc. The company stated on Friday that it would incur $1 billion in non-cash expenses in the first quarter of the year.

The charges relate to prescription-drug benefits for retirees. Companies that provide this benefit, as AT&T does, receive a federal subsidy, plus they can deduct the value of this subsidy from their taxes. The health overhaul cancels the deductibility of the subsidy.

It is for that reason that companies are taking a charge against earnings. They “have a stream of tax benefits that they are losing way out into the future,” said Roland McDevitt, director of health-care research at benefits consultant Towers Watson.

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