Cities struggle to pay for health benefits for active, retired workers

The Sacramento Bee reports that 12 of 13 school districts in Sacramento County don't have enough money to pay for their retirees' health benefits "and are not setting aside money to pay for them, according to a grand jury report released Monday." The districts have $1 billion in unfunded health benefits for retirees, and are effectively ignoring the growing debt, the report says. "A Bee analysis published earlier this month found that, over the past five years, most large school districts in the region saw their employee benefit costs - including retiree health care - rise faster than the statewide average. Yet many local districts pay less toward those costs, on a per-student basis, than is typical for California." Retirees could eventually face a loss of their benefits. Administrators and teachers in the meantime are trying to hash out a plan to increase co-payments and premium contributions from teachers to fill some of the gap (Lambert, 5/11).

WOWT (Omaha, Neb): Omaha officials and retired city workers there are fighting over a proposed increase in premiums that officials hope will cover increased costs in health insurance. "The city says it heard the arguments and came up with a new plan. Premiums will be based on a retiree's pension rather than their position as an officer, firefighter or civilian." Right now, about 84 percent 1,100 retirees from the city don't pay a premium, but that would change under the plan. "The city says the need for change is based on health care costs going through the roof" (Mastre, 5/10).

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This article was reprinted from khn.org with permission from the Henry J. Kaiser Family Foundation. Kaiser Health News, an editorially independent news service, is a program of the Kaiser Family Foundation, a nonpartisan health care policy research organization unaffiliated with Kaiser Permanente.