Debate Heats Up Over Retiree Health Care in San Diego County
San Diego County's retirement board on Thursday rejected a plan by county supervisors to reduce retiree health benefits and adopted a counterproposal that would maintain county contributions to retiree health care benefits, the San Diego Union-Tribune reports (Gustafson, San Diego Union-Tribune, 5/4).
The county board of supervisors in December 2006 approved a plan to stop contributing $30 million annually to retiree health care benefits for current county employees and those who retired after 2002.
Supervisors said the plan could save the county as much as $1.8 billion over 20 years (California Healthline, 2/2).
The county plan includes a provision that would end the county's approximately $30 million in annual contributions to the county health fund if the retirement board rejected the proposal. Such a move would eliminate benefits for all 12,300 retired county employees.
The counterproposal adopted by the retirement board would use reserve funds to pay for monthly pension increases to recent retirees, thereby removing the debt from county funds. The retirement board has enough reserve funds to pay for the pension increases until 2017, according to estimates.
The plan might appeal to the supervisors by reducing the county's retiree health care debt by $350 million, according to the Union-Tribune. The plan also would use excess earnings to reduce the county's $1.2 billion pension deficit until it is 90% funded.
The issue could result in a lawsuit if the board of supervisors rejects the retirement board's proposal, according to the Union-Tribune (San Diego Union-Tribune, 5/4).