Excerpt from the Dayton Daily News
Ohio’s largest public pension system is considering cuts to health care benefits for thousands of current and future retirees as a way to shore up and extend coverage for years to come.
Trustees with the Ohio Public Employees Retirement System could vote as early as this week on health care changes that would go into effect Jan. 1, 2022.
Unless changes are made, OPERS projects that its $11.3 billion health care fund will run out of money by 2030.
The pension system is funded by employee and employer contributions and investment returns. OPERS used to earmark a chunk of employer contributions for retiree health care but stopped doing so in 2018. Instead, all the contributions are plowed into pension benefits, which take priority over health care coverage.
OPERS, which represents most of the county and state workers in Ohio, has provided health care coverage to retirees since 1974.
“Our pension funding has to be solid in order for health care to really be viable. We continue to tell people that,” said OPERS Executive Director Karen Carraher. “The pension is statutory. Health care is a discretionary program. We don’t want to drop it but it can be dropped.”
Once the pension side of the system is on better footing, OPERS could resume putting money into the health care fund. But officials don’t expect that to happen until 2034.
To help bolster the pension side, OPERS trustees voted in September to eliminate the cost of living allowance in 2022 and 2023 for all retirees and delay the COLA for two years for all new retirees. That plan requires a law change — and legislation has yet to be introduced in the General Assembly.
