Severely damaging hurricane names are in fact retired such as Andrew, Hugo, Camille, and I am 100% sure that Katrina will be retired as well.
http://www.publicaffairs.noaa.gov/grounders/retirednames.html
Hurricanes that have a severe impact on lives or the economy are remembered generations after the devastation they caused, and some go into weather history. The National Hurricane Center near Miami, Florida, monitors tropical disturbances in the Atlantic and eastern Pacific Oceans which could become a hurricane.
Whenever a hurricane has had a major impact, any country affected by the storm can request that the name of the hurricane be "retired" by agreement of the World Meteorological Organization (WMO). Retiring a name actually means that it cannot be reused for at least 10 years, to facilitate historic references, legal actions, insurance claim activities, etc. and avoid public confusion with another storm of the same name. If that happens, a like gender name is selected in English, Spanish or French for Atlantic Storms.
There is an exception to the retirement rule, however. Before 1979, when the first permanent six-year storm name list began, some storm names were simply not used anymore. For example, in 1966, "Fern" was substituted for "Frieda," and no reason was cited.
Atlantic Storms Retired Into Hurricane History
Agnes (1972§*): Florida, Northeast U.S.
Alicia (1983*): North Texas
Allen (1980*): Antilles, Mexico, South Texas
Andrew (1992*): Bahamas, South Florida, Louisiana
Anita (1977): Mexico
Audrey (1957§*): Louisiana, North Texas
Betsy (1965§*): Bahamas, Southeast Florida, Southeast Louisiana
Beulah (1967*): Antilles, Mexico, South Texas
Bob (1991*): North Carolina & Northeast U.S.
Camille (1969§*): Louisiana, Mississippi and Alabama
Carla (1961§*): Texas
Carmen (1974): Mexico, Central Louisiana
Carol (1954§*): Northeast U.S.
Cesar (1996): Honduras
Celia (1970*): South Texas
Cleo (1964*): Lesser Antilles, Haiti, Cuba, Southeast Florida
Connie (1955§): North Carolina
David (1979): Lesser Antilles, Hispañola, Florida and Eastern U.S.
Diana (1990): Mexico
Diane (1955§*): Mid-Atlantic U.S. & Northeast U.S.
Donna (1960§*): Bahamas, Florida and Eastern U.S.
Dora (1964*): Northeast Florida
Edna (1968)
Elena (1985*): Mississippi, Alabama, Western Florida
Eloise (1975*): Antilles, Northwest Florida, Alabama
Fifi (1974): Yucatan Peninsula, Louisiana
Flora (1963): Haiti, Cuba
Floyd (1999): North Carolina, eastern seaboard
Fran (1996): North Carolina
Frederic (1979*): Alabama and Mississippi
Gilbert (1988): Lesser Antilles, Jamaica, Yucatan Peninsula, Mexico
Gloria (1985*): North Carolina, Northeast U.S.
Hattie (1961): Belize, Guatemala
Hazel (1954§*): Antilles, North and South Carolina
Hilda (1964§*): Louisiana
Hortense (1996)
Hugo (1989*): Antilles, South Carolina
Inez (1966): Lesser Antilles, Hispanola, Cuba, Florida Keys, Mexico
Ione (1955*): North Carolina
Janet (1955): Lesser Antilles, Belize, Mexico
Joan (1988): Curacao, Venezuela, Colombia, Nicaragua (Crossed into the Pacific and became Miriam)
Klaus (1990): Martinique
Lenny (1999): Antilles
Luis (1995)
Marilyn (1995): Bermuda
Mitch (1998): Central America, Nicaragua, Honduras
Opal (1995): Florida Panhandle
Roxanne (1995): Yucatan Peninsula