Keeping retirement weird. Rahm screws city retirees on their health care.


A note from Jack Retired Water:

Fred, very sorry to hear about your friend. Speaking to that matter of health insurance the city of Chicago is dropping all retirees at end of year. They are offering a private bc/bs policy for a non medicare annuitant and spouse at 2600 a month. For some this could be entire paycheck.

Here is the skinny.

The City of Chicago is offering exactly zero dollars to city retirees to help subsidize health care.


Members of all four retirement plans will have to come up with $1400 for single coverage, $2600 for couples and $3600 for family coverage.

A month.

No subsidies.

I am told that the city never shopped it around to any other providers other than Blue Cross/Blue Shield.

Why should it?

Bill Daley sits on the board of Blue Cross/Blue shield which is the only provider the city is offering retirees. (Note: I cannot confirm that Daley sits on the BCBS board).

Rahm’s folks will send out letters to city retirees saying they are canceling their insurance and then will send out another letter saying they can OPT in for this insurance at those rates.

 At rates no typical retired city employee can afford.


19 thoughts on “Keeping retirement weird. Rahm screws city retirees on their health care.

    1. With all my criticisms of the Affordable Care Act instead of of single payer, Obamacare may be the only affordable option for city retirees.

  1. Also if you leave this city plan and we win at the SC you may not be able to get back in. Worked 30 years in a ditch for Water Dept. Never on disability….never took a day off….never lost a day’s pay. Thank you City of Chicago for honoring your Retirees promises.

    1. Must be something you can do. Where are the unions. It is my understanding that this is settled in the courts. Any new information.

  2. Sometimes it seems like the Daley family, the Clintons, the Obamas, and Emmanuel, are all selling out. Public servants? Seems more like they are greedy con-artists. You hear the cry that Republicans want to bust up the unions, and that they want to keep fighting wars that we can’t afford. But when you read between the lines, it sometimes sounds like the two parties are one and the same.

  3. Every current and retired city worker should flood their alderman’s offices with complaints and picket lines. There is strength in numbers and if your unions won’t shout loud and make demands, that leaves it to every single member to go do this. No one can get by without health insurance, esp. when you are older. Any of this latest rahmonomics in the Tribune anywhere?

  4. Th state can’t do it…They tried…on the 20 year retirees who were offered a premium free policy and Quinn Madigan and company tried to undo it and failed…the ILSC ruled in Kanerva. Rauner is trying the Cullerton trick with current AFSCME workers give up that benefit or I double your premiums.I’m the federal side Deere non union retirees lost their case because the court found for Deere because Deere spelled out the benfit as a gift that could be altered under changing conditions. The state did The opposite and it is proected under the retirement benefits amendment of the Illinois Constitution. I think the city workers and the non Medicare retirees bed to meet with counsel and see where they fit and head to court. I might suggest contacting AFSCME.You might want to add in dental. State and university 20 year retirees were promised free dental. Quinn reneged on that one first and it was never litigated…it should be ……

    1. Unlike AFSCME, state teachers retirement health care is not considered part of our retirement benefit and is not protected by the constitution’s pension provision. It is not free. Hardly. Currently the cost of retirement health insurance and Medicare (which I must pay out of pocket since I am not in Social Security) approaches $1000 a month.

      1. Free or not,it is still affordable. Butif it not considered a benefit,it is not protected and therefore, it could be made UN-affordable, as Rahm is doing to city workers.

  5. Kanerva said only the 20 retiree was free…the premium that is but dependants have to pay something. This applied to just SURs university and state workers. I suspect Freds may be protected as well but I know TRS have to pay a lot and there really is no state money so the state doesnt care. The Kanerva case was from the trial run law. I think they were planning to hold off to see how this one went. When a Sprigfield trial judge with some connection to Nekritz I recall ruled for the state…well you can watch Sandak go into his pension frenzy…..well it we know what has haapened. I see from Jack the Retired that it has been in court …and lost but there is an appeal to the ILSC…..that will all hinge on the existance of the benfit. I have a hunch there is one but only before the first settlement when the city said it was creating what amounts to a teir 2 for healthcare…..but its worth the appeal.

  6. The state already is. Retirees are now required, if they are on medicare, to move to the states “Trail” insurance program. “Total Retiree Advantage Illinois”. Little information is available- except that it is REQUIRED. The letters sent out to retirees says all you need to know is on the website I tried the website- It shows a page saying 401 not authorized. Contacted SURS- they said the information won’t be available until 9-30-16. The letter states we have from OCT 14th to Nov 15th to sign up- or we will loose ALL insurance. No prices are currently available. No coverages are currently listed anywhere. We do know that retirees will NO LONGER be able to use Medicare (but still must continue to pay for it). Deductibles that have already been paid- will NOT carry over to the ‘Trail’ program. All deductibles will start over at ZERO. I would advise anyone whom currently has Medicare Primary with Illinois retirees insurance as secondary, to get whatever medical services needed, completed before the deadline of New Years Eve.

  7. Dear Fred,
    I really knew very little about the Teachers Health Insurance Program before reading about what happened to retired city workers on Fred’s blog. I decided to take a look at The State Employees Group Insurance Act of 1971 (as amended in 1995) Interesting reading.

    Reflecting back on what I read, as well as what thought I knew about retiree insurance benefits, here are some short takes. They could mean something or nothing. I’m no expert.

    First: Fred is absolutely right. Retiree health insurance was never intended to be a “pension” benefit when it was created. It is right in the law. How Kanerva might affect that is unclear as far as teachers are concerned.

    The law was intended to create an ongoing subsidized benefit of health care insurance for retired teachers (among several other things). Unlike most other insurance programs that this law provides, most of the cost for retired teacher health insurance is paid by active teachers and retirees (75% or so) with the state contribution capped at 24%.

    The subsidy is paid out of a special fund (similar to the T.R.S. Pension fund), not out of the state treasury. The state, active teachers, and retirees all contribute to the fund. The fund pays the subsidies.

    I believe (but do not know for sure) that there is a continuing resolution for this contribution to T.H.I.S. The Governor or the General Assembly may or may not put that contribution in the budget, but unlike with other state insurance, they cannot claim the money was not appropriated.

    That seems to be one big difference from the situation with A.S.F.C.M.E.’s insurance subsidies, administered by a government entity and paid for out of the treasury.

    No termination dates are listed in the law. The benefit for teachers looks to be an individual retiree’s property. This is different than retiree benefits negotiated by unions as a group for their members. That is a big part of the issue with city workers.

    I suspect part of the the reason why Governor Rauner and company backed off on their attempt to not budget teacher health insurance subsidies was because it would cost more to end them than to keep them. More in dollars, litigation and public relations.

    The benefit is mostly paid for by teachers and retirees. not the state. It has it’s own trust fund. The legislative intent was clearly stated in the law. There could be problems with the contracts clause of both the federal and state Constitutions, Kanerva notwithstanding. Lots of possible problems to eliminate a program now doing what the Governor claims to want A.F.C.S.M.E. to do.

    Watchful waiting seems to be in order for teacher retirees, as well as support for our colleagues who’s benefits are now under attack. If we have learned anything about dealing with politicians is that they will look for any crack to take what is ours. Harm to one is harm to all. Be vigilant.

  8. Any retiree that reads these should remember all the candidates who caused this and vote them out, including “His Honor in 2019”. They don’t care because the majority of them have dual or numerous pensions with benifits. Beyond cruel and unusual, it’s criminal !!!

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