8. POSTRETIREMENT MEDICAL BENEFITS AND PENSION

Postretirement Medical Benefits

The Company provides postretirement medical benefits to retired employees and their dependents, as mandated by the Coal Industry Retiree Health Benefit Act of 1992 and pursuant to collective bargaining agreements. The Company also provides these benefits to qualified full-time employees pursuant to collective bargaining agreements. These benefits are provided through self-insured programs.

The components of net periodic postretirement medical benefit cost are as follows:



	Three Months Ended June 30,				Six Months Ended June 30,
	2018		2017		2018		2017
	(In thousands)
Components of net periodic postretirement medical benefit cost:
Service cost	$	889	$	794	$	1,779	$	1,587
Interest cost	2,893		3,196		5,786		6,393
Amortization of deferred items	969		965		1,938		1,929
Total net periodic postretirement medical benefit cost	$	4,751	$	4,955	$	9,503	$	9,909

Service cost is included in Cost of sales (exclusive of depreciation, depletion and amortization, shown separately) in the Consolidated Statements of Operations (unaudited) and interest cost and amortization of deferred items are included in Other expense in the Consolidated Statements of Operations (unaudited).

The following table shows the net periodic postretirement medical benefit costs that relate to current and former mining operations:



	Three Months Ended June 30,				Six Months Ended June 30,
	2018		2017		2018		2017
	(In thousands)
Former mining operations	$	2,046	$	2,306	$	4,092	$	4,611
Current operations	2,705		2,649		5,411		5,298
Total net periodic postretirement medical benefit cost	$	4,751	$	4,955	$	9,503	$	9,909

Pension

The Company provides defined pension benefits to qualified full-time employees pursuant to collective bargaining agreements. The components of net periodic pension benefit cost are as follows:



	Three Months Ended June 30,						Six Months Ended June 30,
	2018			2017			2018			2017
	(In thousands)
Components of net periodic pension benefit cost:
Service cost	$	410		$	378		$	821		$	785
Interest cost	2,387			2,630			4,777			5,260
Expected return on plan assets	(3,523		)	(3,648		)	(7,055		)	(7,275		)
Settlements	—			269			—			269
Amortization of deferred items	119			583			239			1,177
Total net periodic pension benefit (gain) cost	$	(607	)	$	212		$	(1,218	)	$	216

Service cost is included in Cost of sales (exclusive of depreciation, depletion and amortization, shown separately) in the Consolidated Statements of Operations (unaudited) and interest cost, expected return on plan assets and amortization of deferred items are included in Other expense in the Consolidated Statements of Operations (unaudited).

The Company made $0.5 million and $0.2 million of contributions to its pension plans during the six months ended June 30, 2018 and 2017, respectively. The Company expects to make $2.2 million of contributions to its pension plans during the remainder of 2018.