Columbus Dispatch editorial: teachers not exempt from rising costs of health care

Time to face facts

Everyone has to pay part of health-care tab; teachers are not exempt

Columbus Dispatch
Monday, October 24, 2005

The Ohio School Boards Association says it might be ready to "start a war" if teachers and school districts are asked to pay a bigger share of retired teachers’ healthcare costs, but this is a war that can’t be won.

A move by the State Teachers Retirement System to seek a law allowing the system to raise members’ and employers’ contributions is a reasonable response to a problem that nearly everyone faces.

Schools and teachers cannot be held exempt from the rising cost of health care. Employers across the board face double-digit jumps in medical bills each year. If these expenses aren’t shared, they threaten to put many employers out of business and to bankrupt pension funds.

For Americans to continue enjoying the world’s best health care, everyone will have to pay more.

Most private-sector employees have seen their share of premiums and copays rise substantially in recent years.

Even the United Auto Workers, long the poster child for excessive benefit packages, agreed recently to a new pact with General Motors, under which retirees will pay up to $752 more per year toward their health care. The agreement could help stave off bankruptcy by cutting GM’s medical bills by $15 billion over seven years.

Government agencies, with taxpayers’ dollars at their disposal, have been slower to act. The resulting budget deficits are the predictable result.

Workers at Franklin County Children Services struck over the issue in the spring. The eventual contract was the first in county government to require any health-care payments from employees, but the agreed contribution for 2006 of $35 to $50 per month per employee is woefully inadequate.

A key issue holding up a new contract between the Central Ohio Transit Authority and Transit Workers Union Local 208 is how much workers should pay toward health-care coverage. To date, they have paid nothing.

A large part of the crippling deficit faced by Columbus Public Schools is the result of a $19 million overrun in the school district’s self-insurance fund for medical coverage.

By seeking a higher contribution from teachers and their employers, the State Teachers Retirement System is attempting to avoid such a crisis. The Ohio Supreme Court in May let stand a lower-court ruling that said the School Employees Retirement System has the right to charge retirees more for health insurance in response to rising costs.

Teachers and school boards understandably don’t want to pay more, but they should bear in mind that the system isn’t required to offer any healthcare coverage to retirees. This benefit began in an era when medical expenses were lower and the pension fund’s earnings easily could pay them, but that era is gone. The members’ insistence on a broad plan with minimal contributions could result in no coverage at all.

As the American people, and not just their employers, pay ever-accelerating medical costs, Congress and the president eventually will feel compelled to join most nations of the developed world and create a national healthcare program. It likely will be a no-frills plan, and those who want more will have to pay for it.

Until that time, employers need to stay in business and pension plans, including the State Teachers Retirement System, have a responsibility to remain solvent. So everyone, teachers included, will have to pay more for health care.