New Report Estimates State Retiree Health Care Liabilities at $558 Billion
Posted on: Wednesday, 15 July 2009, 05:00 CDT
But plans differ greatly from state to state.
WASHINGTON, July 15 /PRNewswire-USNewswire/ -- States have unfunded liabilities for retiree health care of about $558 billion, including for teachers, according to a new report from the Center for State and Local Government Excellence.
"At a Crossroads: The Financing and Future of Health Benefits for State and Local Government Retirees" is the first systematic (entire workforce) assessment of the level of OPEB (other post-employment benefits) liabilities of US states and a sample of localities.
Center for Excellence Executive Director Elizabeth K. Kellar and North Carolina State researchers Richard Kearney, Robert Clark and Jerrell Coggburn will discuss the report in an audio news conference on Wednesday, July 15, 1-2 pm EDT. Dial 1-866-394-4041; enter access code 19720405 when prompted.
Key findings of the report include:
- State plans differ substantially in their generosity, coverage, and outstanding liabilities.
- Unfunded actuarial accrued liabilities (UAAL) for many governments are large in absolute value and relative to total state expenditures, debt, and per capita income of the state. For others they are not.
- Actuarial statements reveal substantial differences in total unfunded retiree health care liabilities. This is a function of work force size, plan generosity, and the portion of health care costs paid by the employer.
- Most state and local governments, however, have adopted various cost containment, cost shedding, and cost sharing policies, including retiree premium contributions, higher deductibles, and higher co-payments. Some have curtailed benefits for future retirees.
- Preventive medicine and wellness programs are catching on in the states, but most to date are limited in scope.
- State and local governments report they are more willing to consider changes in age and/or years of service requirements for retiree health care eligibility.
Read the full report at http://tinyurl.com/atacrossroads
About the Center for State and Local Government Excellence
The Center for State and Local Government Excellence helps state and local governments become knowledgeable and competitive employers so they can attract and retain a talented and committed workforce. The Center identifies best practices and conducts research on competitive employment practices, workforce development, pensions, retiree health security, and financial planning. The Center also brings state and local leaders together with respected researchers and features the latest demographic data on the aging workforce, research studies, and news on health care, recruitment, and succession planning on its website, www.slge.org.
SOURCE Center for State and Local Government Excellence
Source: PR Newswire
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