BENISTAR
Share the love...

Senior Star Third Quarter 2012

QUOTATION OF THE QUARTER

For every sale you miss because you’re too enthusiastic, you will miss a hundred because you’re not enthusiastic enough.”

 Zig Ziglar

 


Stockton Retirees File Lawsuit To Retain Health Benefits.

The Los Angeles Times (7/12, Marcum) reports, “A group of Stockton retirees has filed suit in US Bankruptcy Court asking for a restraining order against the city’s moves to cut their health benefits.” The move to cut benefits is said to be part of the Stockton’s “pendency plan” keep that will keep the city solvent as it seeks protections from creditors under federal bankruptcy law. The suit “seeks class-action status covering all retirees,” although several of the managers with higher incomes have indicated they would be willing to give up their benefits. The Times notes that “two-thirds of the city retirees do not meet poverty requirements for California’s low-income healthcare program but cannot afford private insurance.”


HHS plans to announce Wednesday that in the first six months of this year, “more than 1 million seniors and people with disabilities saved $687 million on prescription drugs in the doughnut hole” as part of the President’s healthcare law, USA Today  (7/25, Kennedy) reports. That amounts to a savings of “$629 per patient” and administrators “expect to see larger savings in the second half of the year because more people will have hit their coverage limit by then.”


It’s D-Day for the Post Office

“Wednesday, Aug. 1 … the Postal Service is obligated, by statute, to make a $5.5 bil.lion payment … to ‘prefund’ health benefits for future retirees. But, with less than $1 bil.lion in the bank, the Postal Service announced on Monday that it would not be making the payment. It has a second payment, for $5.6 bil.lion, due in September. Unless lightning strikes, it won’t be making that one either…. [T]hat prefunding requirement … has cost the post office more than $20 bil.lion since 2007—a period during which its total losses amounted to $25.3 bil.lion. Without that requirement, the post office would still likely be struggling, but it would have a lot more wiggle room—and a lot more cash. (Its pension obligations are also overfunded by around $11 bil.lion.)” (The New York Times; free registration required)


How California Has Failed to Prepare for its Accumulating Retiree Health Care Obligations

“Retiree health care is the largest component of these Other Post-Employment Benefits (OPEBs). As the Baby Boomer generation has begun to retire, we have seen an upswing in the number of retirees accompanied by both longer predicted life spans for those retirees and an overall increase in health costs. In short, more people are earning benefits for longer periods of time at higher costs. Together, these factors will make it increasingly difficult for California to pay for these benefits in the future. Unlike pensions, which the State pre-funds by setting aside money for benefits when they are earned, retiree health care benefits are currently paid out of the State’s operational budget, forgoing potential savings from investment profits.” (California Common Sense)


The Chicago Tribune.  There are still many brand name prescription drugs losing patents this year and next.  For a list of the drugs going off patent, click into the article.  (Elejalde-Ruiz, 8/1)  Full story


City Bankruptcies Target Retiree Health Care Costs

“Lifetime retiree health care from an employer, rare in the private sector, is an important benefit [for] public employees… In 2007 [the California state Controller] made the first estimate of the cost of providing retiree health care for current state workers and retirees: $50 bil.lion over the next 30 years. Last February his actuaries increased the estimate to $60 bil.lion.” (CalPensions)


Public Employer Retiree Health Costs Rising

“State and local governments in New York will have to come up with an additional quarter of a trillion dollars to pay the entire tab for retiree health care, according to a new report. The $250 billion bill for retiree health coverage is up from $210 billion two years ago, said the study issued by the Empire Center for New York State Policy on Wednesday. Referred to as ‘other post-employment benefits,’ or OPEB, the unfunded obligations represent a troubling strain on budgets.” (The Wall Street Journal)