California Should Consider Changes to Health Benefits
Controller John Chiang (D) on Monday estimated that California will face about $48 billion in costs for retiree health benefits, a figure that surprisingly is "on the conservative side," Daniel Weintraub writes in his Sacramento Bee column.
According to Weintraub, Chiang's estimate is based on projections that annual health care inflation will decrease to 4.5% over the next 10 years, something that appears unlikely based on recent trends. Moreover, Weintraub writes that annual contributions to health care benefits for current and future retirees -- about $3.6 billion -- would surpass state funding for either the University of California or the California State University system.
Although California lawmakers "should not and cannot consider" eliminating health care benefits for retired state workers, California leaders should consider requiring employees to contribute to their health care benefits in the same way that they contribute to their pensions, Weintraub writes (Weintraub, Sacramento Bee, 5/10).