Article: Retired teachers' medical benefits fund dwindling (NH)

Boston.com, December 21, 2005

CONCORD, N.H. --The state's retired teachers are worried about the future of their health benefits.

Working teachers contribute 5 percent of their pay to the retirement fund managed by the New Hampshire Retirement System. About 2,500 retired teachers currently receive medical benefit payments from a specially-created account.

But without an overhaul of its funding system, that account run dry by 2012, according to New Hampshire Retired Educators Association. Moreover teachers would have to retire by 2008 to qualify for those benefits.

The funding problem started about five years ago, when the account took a hit because of a drop in the stock market. It forced the system to pay some $10 million in benefits out of the account's principal. Complicating the matter, there currently is no backup system in place to supplement the fund with money from other sources, said Rick Trombly, a lobbyist for NEA-NH, the state's teachers union.

A state panel looked at the problem earlier this year but held off on making recommendations, pending further study.