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Life Health > Health Insurance > Your Practice

Illinois Ends Free Health Insurance for Retirees

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SPRINGFIELD, Ill. (AP) — More than 80,000 retired government employees will lose reduced or even free health insurance under legislation Gov. Pat Quinn signed Thursday, ending a major benefit Illinois had promised to employees.

Future state retirees also have to pay under the legislation, part of a push to curb state spending on retirement benefits. That applies to roughly 200,000 people who already took government jobs with the understanding that their insurance payments would be lower in retirement the longer they work for the state, and eliminated after 20 years of service.

Exactly how much the additional expense will be isn’t clear. Insurance rates will be negotiated with unions and approved by a legislative commission.

Gov. Pat Quinn said employees who served taxpayers deserve quality health care. “We also have a duty to taxpayers to ensure these plans are cost-efficient and put Illinois on the path to fiscal stability,” he added in a statement.

The Chicago Democrat announced the signing in a news release shortly after 5 a.m. The release said the legislation will “preserve health care benefits for state retirees.”

A key union dismissed that as “political doubletalk.”

“By cutting retiree health care at the same time he’s handing out hundreds of millions in tax giveaways to big corporations, Governor Quinn shows his priorities are out of touch,” said Virginia Yates, president of the group representing Illinois retirees for the American Federation of State, County and Municipal Employees.

In 2010, the state reduced pension benefits for future government employees. Quinn and legislative leaders are now negotiating over a plan to cut pension checks for current workers and retirees in an effort to shore up pension systems that are $83 billion short of what they’ll someday need to pay out.

The insurance legislation applies to state employees, university and community college staff, judges and legislators. Until now, the state has paid the health insurance premiums for retirees in those categories if they’ve worked a certain number of years — generally 20. Retirees still were responsible for co-pays and deductibles.

AFSCME said retirees pay $3,000 a year or more in co-pays and other health costs.

The measure had bipartisan support.

“I have a lot of compassion for those people who retired anticipating a certain benefit that now may be changed somewhat,” Senate Minority Leader Christine Radogno, R-Lemont, said in the governor’s release. “Having said that, this is a step Illinois must take to right the financial ship.”

For more on pension cuts, see:

California Pension Cuts May Have Ripple Effect

NH Senate Orders Study of Public Pension System

Employee Groups Uncertain About Kansas Pension Plan


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