DETROIT (Reuters) - A healthcare trust for retired U.S. autoworkers was $33 billion short of meeting obligations to cover medical costs of those retirees at the end of 2011, newly released federal documents show.
The funding shortfall of $33 billion in the second year of the healthcare trust was 63 percent higher than the gap from the previous year.
Healthcare costs grew as the trust's assets shrank.
The United Auto Workers Retiree Medical Benefits Trust saw the value of its assets drop about 11 percent to $52.4 billion in 2011 while the S&P 500 index was flat.
Meanwhile, the trust's benefit obligation rose 8 percent to $85.3 billion, an amount that is about $5 billion more than what U.S. taxpayers spent to prevent the collapse of General Motors Co, Chrysler Group LLC and Ally Financial during the financial crisis three years ago.
The trust managed benefits for 824,000 retirees from affiliated with the United Auto Workers union in 2011.
The UAW trust, which is known as a VEBA or voluntary employee beneficiary association, was created in 2007 during labor talks with the UAW. The union-affiliated trust took on the retiree health care burden from GM, Ford Motor Co and Chrysler.
The landmark deal was designed to protect UAW retiree benefits if the companies' finances deteriorated and to remove an ever-increasing liability that the automakers said added as much as $2,000 to the cost of a vehicle.
The trust's first year of operations was in 2010, when it was underfunded by roughly $20 billion.
In 2011, the VEBA was hit by the loss in value of its investments in GM, the largest U.S. automaker.
(Reporting By Deepa Seetharaman and Bernie Woodall; Editing by M.D. Golan)