Question about HCRA (feel like I'm being taken advantage of)

I'm a member of a labor union. As part of my benefits package (which is not my "wages" per say, but it's a dollar amount that is voted on at contract time by the membership), a contribution is made to an HCRA account.
While you're an active member, you're given access to a small percentage (20%) of your yearly contribution to purchase non-prescription drugs and certain otc medical related items. The rest of the contribution goes into the account, and is essentially innaccessible until retirement, when you're supposedly allowed to spend it on any medical costs, including co-pays, insurance premiums, and prescriptions.
The contribution for most members is between $5k and $6k a year (which I'm hearing is a lot for an HCRA, especially when there is already a robust health insurance plan), leaving many members with $130k to $180k in their accounts as they get nearer to retirement. As part of the terms of the plan, if the member dies before retirement, their spouse is only entitled to a small portion of that money, along with 18 months of assistance to help cover insurance, and the plan itself absorbs the balance of the money.  Retired members that pass away can leave the remainder of the money to their spouse, however once the spouse passes away the funds get absorbed back to the plan, and from what I've heard from new retirees it's actually kind of hard to spend the money, with many claims being denied.
Does this sound like an illegal plan? Or maybe just unethical? It seems like the cards are stacked entirely in the plan's favor and it's a large risk with potentially little reward. How would the membership get out of this without forfeiting the money? Or am I being ridiculous and it's a good deal. This plan was never voted in, but was forced on the membership through administrators.

This sounds like a great deal.  There is far too little information here for any of us to provide you with a complete explanation, but from what I see and know this is more than likely a legal plan.  I am assuming that the union negotiated this on your behalf and is a collective bargained plan.  Many unions are utilizing this as a way to fund post-retirement.  What I cannot comment on is the specifics you discuss in your post, such as the amounts, the difficulty in use, denial of claims, etc., because I do not have access to the plan documents.

You asked if this is unethical, but without any qualifier as to why.  I believe not, and in fact I would say that this type of plan is very generous and somewhat unusual.  Most Americans do not have an employer depositing money into a post-retirement account.  While $130-$180k may sound small, when you consider what the eligible expenses are for this plan, that is a significant amount of money.

Speaking for me alone, and I have been doing employee benefits for 42 years, this is a very generous plan.

This type of plan allows for flexibility.

Thank you for the reply and the insight, I very much appreciate it. I think what has the membership the most concerned is that they feel as though if they had autonomy over that contribution (and at the next contract it could in theory be voted to be allocated into wages or retirement), they could use or invest it better.  Employment rates can definitely fluctuate drastically in this industry, and for a member to have a six figure account waiting for them at retirement, only to be laid off for 3 months a year and struggle to make enough hours for pension credits (to retire), it can be a tough pill to swallow.

I will certainly pass on your comments and positive outlook to my colleagues, we do tend to develop tunnel vision at times and perspective from a qualified source is always a bonus.

Yes, we all do tend to get trapped sometimes in tunnel vision, if only it were of the Lincoln Tunnell I would be happy.  Glad to be of help.  Have a good day.