The government is allowing employers to pay less for health insurance to retirees over 65 since Medicare picks up most of the cost for them.

The Equal Employment Opportunity published the rule Wednesday, formally authorizing a long-standing practice. The commission says employers can spend less on retirees over 65 without violating laws against age discrimination.

The EEOC says it proposed the rule after a federal appeals court decided that age discrimination laws required employers to spend just as much on younger retirees as they did on older ones.

The commission says that decision would have resulted in companies reducing or even eliminating retiree health care programs.

Under the rule, retirees in both age groups would, in theory at least, get essentially the same benefits. But it's less costly to the company for those over 65 because Medicare picks up much of the tab for them.