An editorial from Molly that speaks volumes: What options are left for retirees?

From Molly Janczyk, December 29, 2006

Subject: Please, Tell Us: What Options Do Retirees Have?

What more can we do?

We served your children asking only for modest but secure retirements with health care. We were discouraged from purchasing other medical plans by STRS literature saying it would erode our pensions while being told we had excellent health care which would never be a problem.

Yet, many did know health care was becoming prohibitive while not working to secure a stream of revenue for a health care fund relying on the market instead. After the fall of the market, we were told it was a 'perfect storm' of a market downturn and soaring of health care costs creating a crisis.

Why then, did Joe Endry speak in the early 90's saying if health care costs weren't addressed then, we wouldn't have health care? Why then, did Herb Dyer say it wasn't necessary to pursue health care legislation instead stating he wanted out of the health care business?

What blame do retirees have in any of this? We went to consultations and planned accordingly and no one told us that bad news was fast approaching. So, we made irrevocable decisions and followed our counselors' advice. Sure, we had saved what we could in annuities but educators and especially educators with families can only save so much. We did everything we were supposed to do. We retired. And then, the sky came down. Virtually overnight, we tried to absorb 400% up to 800% increases in health care costs for families.

In 1999, my spouse was approx. $33 per month. In 2007, he is $581. I was -0- in '99 and am now $163 (not bad if that was all I paid). $744 per month in just premiums for both of us vs. $33 for both of us in 1999.

That alone is over a 400% increase in premiums each month.

But, there are other changes taking away benefits. Not medical actual benefits but money benefits as we went from 100% coverage after low deductibles to 80% coverage (we now pay 20% of medical costs out of pocket up to $1500 each person) and our deductibles are now $500 each person.

RX's have gone from $5 and $10 to:

$25, $75, $125 each for a 90 supply. The average household of 2 persons has 20 Rx's.

20 Rx's times the lowest rate of $5 = $100 vs. today's 20 Rx's x $25 = $500 and these figures are for generics only. Much more is spent if we can use only brand names or need a Rx our Dr. orders but STRS feels is too pricey or decides it is not on their formulary.

STRS MAKES ALL DECISIONS ABOUT WHICH DRUGS ARE ON FORMULARY AND OFF FORMULARY.

Well, as I heard Hazel Sidaway asked: "Why are they complaining about? We gave them a 3% COLA! Yes, you did! SIMPLE COLA NEVER TO INCREASE BUT ALWAYS REMAINS STAGNANT BASED ON OUR FIRST YEAR OF RETIREMENT!

Mine is approx. $70 more per month each year. $70 x's 7 yrs. = $490 more each month in 2007 vs. 1999. Doesn't even cover our RX's increase as we do have some meds that need to be name brand or do not yet have generic.

So every year, retirees lose more than they gain. That average of $70 doesn't ever cover the increased costs and so never even makes it to inflation which translates to more loss to retirees.

We, who can, went back to work, which was Joe Endry's solution. Too bad for those who could not work. Of course had anyone bothered to explain the real situation to us, many of us would not have retired.

We have used savings, some have sold homes and moved in with children. Now, Medicare reimbursements are cut for those 65 and older as well. Every year, we work with less money and then the next year comes, and we realize less yet again. Retirees are on the decreasing benefits plan never realizing any gain and only continually losing more money each year.

Can anyone tell us, what options do retirees have? Retirees have been robbed of their retirements and we will never recoup our losses. Our hope is for actives. We wish this on no one and know how important it is that young and highly qualified educators stay in Ohio. But, why would they with no promise of health care in retirement (we have learned there is no retirement without health care) and Ohio education not properly funded.

Write your legislators asking their positions on the HCA legislation and stressing the importance to our state to attract educators and keep them. This is the only chance young educators have of securing health care for their retirements and no educator can ever save enough for their health care. A few dollars now out of actives' checks would have been such a welcome option to us had we been given that chance to secure affordable health care for the future of all educators. The average amount is approx. $50 per check now if legislation passes for health care in retirement. Compare that with trying to save for health care in retirement at an average cost of $240,000+ each for just health care in retirement.

Some school districts and legislators like to point generically to numbers alone stating that STRS is a billion dollar system and simply needs to manage properly. In spite of all the bad press and misspending, none of that would have come close to paying for health care for even one month. Approx. $270,000,000 was misspent as I recall, and STRS spends up to $1.5 million per day on our health care being self insured. We always knew this. It was just wrong and we were outraged they helped themselves to our earnings! We felt a fund for needy retirees or some other option with extra money, our money, was in order vs. Board Members treating themselves. Mostly, we felt time would have been better spent planning long term for a stream of revenue for health care such as is going on now with this legislation.

School districts are in trouble and can use some realigning of funding themselves and trimming of top level positions. The answer is fighting to get education properly funded so funds can be set aside for legislation and employer contributions. Stop spinning wheels on failed programs and hefty salaries and perks and redirect for educators. We can all point fingers.

Employees recently experienced a 0.7% increase in contributions -- the first increase in many years. Retirees have borne the brunt with the increases described above to save the system. It is time to share the burden more equitably with those who have the capacity to make much more and it is for their futures. Our burden will not be lessened but actives' futures will be much more secure with health care in retirements. It is the closest possible solution to guaranteeing health care for generations to come.

Legislators, School Boards: What are retirees to do to survive? Why are young educators to choose education without secure retirements with health care when other occupations call them with better futures?

Educators are not to blame for this crisis. Please stop punishing us. Retirees will start using the ER more being unable to pay for treatments and meds. The state will be more burdened. Someone has to pay. Retirees have run out of options.