The state bi-annual budget process has begun with the presentation of the Governor’s budget. He is recommending an appropriation to the HIPA (our Health Fund) of 25%. Since 2010, the state has only fully funded the account (33%) once in 2012, leaving approximately $125 million NOT funded as of 2016. This has presented itself as a LOOMING CRISIS.
The TRB (Teachers Retirement Board) has requested a full evaluation of the HIPA funding by its Health Insurance consultant, Dr. Joe Fields. The report is dated March 9, 2017 and we quote,
“Given the State’s recent inability to fully fund the TRB Medical Plan and assuming continuation of current policy, it is likely that the Medical Plan Trust Fund will be exhausted in the next 2.5 years. The current amount that the State is underfunding its contribution to the fund is approximately $16 million per year. Given that the State is flat-funding its contribution, the amount of short- funding increases (assuming no changes to funding) over the next two years to $20.6 million and then to $ 26.4 million. This produces a short-funding of $54.8 million over the two and half year period.”
“Given that the balance this year reached a low of $54 million, the fund would essentially be exhausted in two and half years. The way in which cash flows occur in this plan would indicate that any insolvency would most likely occur in October or November of 2019”.
Retired teachers have contributed to their health benefits during their entire educational careers. They have adjusted to new legislation (2006) and they expect the state to honor the legislative contract throughout their retirement. The above information reminds us of the saying”Who is Watching Those Who Should Be Watching for Us?” THE ARTC IS !
Your help is needed at this time to protect your hard earned benefits. Write, e-mail, call, speak directly to your legislators and direct them to fully fund the state portion (33%) to the HIPA for the budget years 2017-2018. For contact information click here.
Rick and Louise Follman, Insurance chairs