Reading the reports of Governor Rauner’s budget address some would think that he wants to go after teacher pensions AND the state subsidy to retired teachers’ health insurance benefits
But that isn’t true.
The Illinois Supreme Court has ruled that health care benefits are pension benefits and fall under the pension protection clause of the Illinois Constitution.
They are one and the same.
Neither can be diminished or impaired.
About 77,000 people are covered by the Teacher Retired Insurance Program, known by its acronym, TRIP.
Funding for the TRIP program comes from four sources: the state subsidy, local school districts, currently active state teachers and premiums paid by people enrolled in the program.
Retired teachers pay premiums as part of the program. The monthly premiums vary widely depending on the plan selected.
Monthly premiums are about $246 for someone up to age 64 who is in an HMO and not covered by Medicare. For the same person age 65 and over the monthly cost is $336. For someone in Medicare, regardless of age, the cost is about $97 a month.
Retired teachers like me cover about 33 percent of the program costs.
The state subsidy covers roughly 25 percent of the program cost.
That is the money the governor wants to eliminate.
In the unlikely event that the legislature would agree to Rauner’s proposal, it would immediately be challenged in court.
He would lose.
The Court has already ruled in the Kanerva case that the pension protection clause protects more than the pension annuity. It protects all benefits of membership in a pension system, including health insurance benefits.
In 2015, the administration said it wanted to change employee health insurance through negotiations with unions.
But in the case of Matthews v. CTA the Illinois court ruled that collective bargaining does not bind retirees. While the Supreme Court held that constitutionally protected pension rights can be waived through collective bargaining, the collective bargaining does not extend to current retirees.
The plaintiff in the Matthews case who was already retired when changes to pension rights were approved in collective bargaining was not bound by that decision and kept his pre-existing pension rights.