Retired county workers face huge increase in health insurance premiums

I read today in the Times that the O.C. Supervisors “approved new rates for retiree medical coverage that will pare down a $1.4-billion shortfall but nearly double monthly premiums for some former employees.”

Wow. And there is more to the story, “The county has taken the position that healthcare coverage for retirees is not a legally protected benefit; an association representing retired employees has hired a lawyer and plans to file a lawsuit.”

Here are a few more excerpts:

“I want to beg you not to do this,” said Rita Nicolosi of Orange, who receives a pension of $700 a month after working in the County Jail for 20 years. “As of 2008, I will no longer be able to afford medical insurance. I hope you can live with your conscience.”

Overall, costs for active employees — who are generally in better health and therefore better risks — are expected to dip 18%, but rates for retirees are expected to increase 34%. Their rates will increase much more if they are members of health maintenance organizations such as Kaiser and Cigna.

Of the county’s 6,000 former employees, about 2,000 enrolled in those plans will see rate increases of between 72% and 95%, according to a county staff report.

I am not going to rip the Supervisors for this vote. They are trying to deal with a massive shortfall. However, it is sad to see former county workers put into this situation.

For some, that could mean additional costs of as much as $7,000 a year — with most of the county’s retirees living on annual pensions of less than $25,000. One retiree, Norma Roberts of Costa Mesa, said her monthly out-of-pocket expense would increase from $286 to $783 under the new rates.

No matter how you slice it, this is going to hurt a lot of people. I wish the Supervisors could have found another way to do this. But consider this : Supervisor Bill Campbell said that the rate increases were painful but necessary to save the program, and that they were better than doing away with retiree medical care altogether, which had been under consideration.

How did this situation come about? It is astounding that the union and the county did not head this off at the pass. This really reflects poorly on previous Supervisors who apparently were asleep at the wheel while this crisis began to fester.

I wonder how other counties are dealing with this? It seems a shame to put our former county workers in such a bind.

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"Admin" is just editors Vern Nelson, Greg Diamond, or Ryan Cantor sharing something that they mostly didn't write themselves, but think you should see. Before December 2010, "Admin" may have been former blog owner Art Pedroza.