Drivers for Change:

Health care costs
  (including prescription
  drugs) rise faster than
  inflation

Costs of retirees increase
  at greater rate than costs
  for active employees

Costs for pre-Medicare
  retirees are the highest

Trend toward early
  retirement increases
  retiree health liabilities

Aging population with
  longer life expectancies
  leads to greater demand
  for health care services

GASB accounting
  requirements [Learn More]

Emerging Retiree Health Care Crisis

OverviewPill Bottle

Rapidly escalating costs of health care premiums are adversely affecting an employee's ability to afford traditional retiree health benefits [link to benefits[. Public sector retirees and employees are bearing a significant amount of the cost associated with their health care - and in many cases, the full cost.

As the American health care system is battered by a crisis of rapidly escalating costs, more and more of the costs are borne directly by retirees.

Most states and many localities currently make health care benefits available to their pre-65 and post-65 retirees. Post-employment health benefits often extend to retirees' spouses and dependents.

Unfortunately, state and local governments are facing a seemingly insurmountable task of balancing their commitment to provide comprehensive health care benefits to employees and retirees, while also controlling expenditures within increasingly strained budgets. [more]