Assistant Majority Leader Jeff Schoenberg (D-Evanston) welcomed Governor Quinn’s signing of legislation he sponsored in the Senate to reform health insurance for retired state employees. Under the new law, retirees would contribute to the cost of their health insurance premiums based primarily on their ability to pay in order to help save their existing benefits structure. Sen. Schoenberg issued the following statement: 

“With the state on pace to spend nearly $1 billion on retiree health insurance next year, continuing to provide a full subsidy for the premiums of over 90 percent of state retirees was completely unsustainable and unaffordable. This desperately needed reform gives us a fighting chance to maintain existing levels of coverage and co-payments.

“Gov. Quinn initially proposed in his budget address last year that we address this issue with an across-the-board, fixed rate contribution by retirees. That approach would have placed a disproportionately harsh burden on retirees on modest fixed pension incomes. Instead, we are establishing a graduated contribution structure that is inherently more fair and does not render health insurance unaffordable for seniors with smaller fixed incomes.

“People who have higher pensions – like retired lawmakers, judges, governors and agency executives – can and should pay more toward their health insurance premiums.” 

Under the new law, Central Management Services will create the tiered, sliding scale through the collective bargaining process, and the Joint Committee on Administrative Rules, a legislative oversight panel, will review any proposed contribution plan. In practice, the new law (introduced as Senate Bill 1313) will affect state and university retirees, as well as former General Assembly members and judges; most retired teachers and community college employees are insured through the TRIP and CIP programs. 

The reforms will affect only the amount of the premium each retiree is responsible for paying. It will not affect retirees’ choice of health plans or cause anyone to lose coverage, Sen. Schoenberg said.