Table:
|  | DB PENSION PLANS AND OPEB PLANS |  |
| --- | --- | --- |
| FOR THE YEAR ENDED DECEMBER 31 | 2019 | 2018 |
| Post-employment benefit obligations |  |  |
| Discount rate | 3.1% | 3.8% |
| Rate of compensation increase | 2.25% | 2.25% |
| Cost of living indexation rate (1) | 1.6% | 1.6% |
| Life expectancy at age 65 (years) | 23.2 | 23.1 |
Paragraphs:
SIGNIFICANT ASSUMPTIONS
We used the following key assumptions to measure the post-employment benefit obligations and the net benefit plans cost for the DB pension plans and OPEB plans. These assumptions are long-term, which is consistent with the nature of post-employment benefit plans.
(1) Cost of living indexation rate is only applicable to DB pension plans
The weighted average duration of the post-employment benefit obligation is 14 years.
We assumed the following trend rates in healthcare costs: • an annual increase in the cost of medication of 6.5% for 2019 decreasing to 4.0% over 20 years • an annual increase in the cost of covered dental benefits of 4% • an annual increase in the cost of covered hospital benefits of 3.7% • an annual increase in the cost of other covered healthcare benefits of 4%
Assumed trend rates in healthcare costs have a significant effect on the amounts reported for the healthcare plans.
Question:
Within which areas is an annual increase in healthcare costs assumed?