SF Official Warns of ‘Prop B’ Pension Cutback Effects

August 9, 2010 (PLANSPONSOR.com) – A proposed city charter amendment by San Francisco Public Defender Jeff Adachi overhauling city worker pension and health care benefits could have unintended negative effects including endangering $23 million in federal health care funding, one official asserted.

The San Francisco Chronicle reported that Catherine Dodd, director the city’s Health Service System, warned that Prop. B would disqualify the city from being eligible for the federal funds over the next four years because the city would lower the amount it contributes to health care, voiding its application for the supplemental funding under federal rules.

Dodd also warned that Prop B, on the November ballot, restricts city employee health care contributions so the measure would also hike workers’ insurance payments. Dodd’s agency administers health benefits for city workers and retirees. The Adachi proposal calls for city workers to pay more into the retirement system and to pick up more of the health care costs for their dependents.

According to the Chronicle, employees using the city’s Kaiser Permanente plan for health insurance would see their monthly payment go from zero to $9. With one dependent, their monthly payment would rise from $9 to $249, the Dodd memo said, according to the newspaper.

Further, the more than 4,000 employees enrolled in the popular Blue Shield plan would see monthly health care payments for them rise from zero to $121, and with one dependent nearly quadruple from $121 to $473.

Adachi contends, on the other hand, that his proposal could save taxpayers an estimated $170 million a year in pension contributions.

Darcy Brown, a spokeswoman for the Proposition B effort, said Dodd was misreading federal law.”There’s nothing in the law that says this would jeopardize our funding,” Brown told the Chronicle.