AZ Committee Recommends Cutting Retiree Health Care
If the recommendation is approved, the decision would affect m ore than 4,000 early retirees from state government who could suddenly be faced with the prospect of changing health insurance providers. The retirees that now have coverage under a Pacificare plan, would instead need to turn to former employers, such as school districts and state agencies, for coverage, according to a report in The Arizona Republic.
The move is needed because the pool of retirees in
the state plan is declining, sending premium rates higher
and scaring off potential health providers, committee
members said.
“We’re trying to get out in front and address an issue
before it becomes a crisis with no solutions,” said
committee Chairman Chuck Essig, who is a member of the
nine-member state retirement board.
However, before the recommendation could go into effect,
the plan would still need approval from the full board and
probably the state Legislature. Therefore, Essig said
changes would begin no sooner than 2005.
Not surprisingly, the recommendation has drawn sharp
criticism from some local school districts and other public
employers that fear the dearth of uncovered retirees would
shift responsibility for providing insurance back to them.
This in turn would drive up health care premiums for
current employees, these groups fear.