Retiree Healthcare Is City Council Target


Tom Moutes

Retiree Update

By Tom Moutes, RLACEI Director

A Council motion presented by Bob Blumenfield and Paul Krekorian and seconded by Paul Koretz could harm your Retiree health benefits. That motion (Council file number 20-1606) aims to reduce the City’s healthcare costs for “current employees and retirees, especially those retirees who are not yet eligible for Medicare.”

RLACEI is strongly opposed to any significant changes to the Retiree healthcare benefits provided by LACERS. RLACEI President Ruth Perry gave public comments to the Council’s Personnel, Audits, and Animal Welfare (PAAW) Committee expressing the following rationale in opposing benefit changes:

  • Pursuant to LACERS most recent actuarial valuation, its Retiree health benefits are exceptionally well funded at 85.6 percent. This funding level is virtually unparalleled in any jurisdiction in the country.
  • LACERS already works diligently every year to help ensure the best possible pricing for the healthcare plans it makes available to its Retired members. These annual efforts include, but are not limited to:
    • Considering whether to go out to bid on the contracts and actually going out to bid every time it is deemed to be prudent.
    • Requiring its healthcare providers to give LACERS and its consultant voluminous data (not member identified) regarding the usage its members make and do not make of the plans.
    • In conjunction with its healthcare consultant, LACERS makes use of that data to help keep its rates low and to help ensure its members are using the benefits appropriately. Through this process, LACERS has been able to keep healthcare increases well below the actuarially assumed increases.
    • LACERS also uses the data from the healthcare providers to provide areas of focus for its LACERS Well program. Through this program, LACERS helps its Retirees live healthy retirements, including incentivizing specific preventive healthcare. LACERS was the first public institution to make such data-driven use of its Retiree healthcare program.

During a global pandemic, this is an especially terrible time to discuss healthcare reductions and/or increased co-pays, deductibles, and other costs for the women and men who served the City well during their careers. Some of our oldest and most vulnerable Retirees are the ones who can least afford such changes and the ones who provider and doctor changes would most adversely impact.

Despite RLACEI’s public comments, the PAAW Committee passed the motion without any discussion or debate. As of the writing of this article, this motion could be significantly harmful. The motion will be heard at the next Budget and Finance Committee meeting, then will likely be forwarded for City Council consideration.

RLACEI will continue to fight this benefit-reducing motion. We encourage you to aid in that fight by staying aware of threats to our benefits (up-to-date information is available on the RLACEI Facebook page), contacting the City Council offices, and making public comment at committees. Through our collective efforts, we can protect our promised benefits that we all worked hard to earn!