Is There a Funding Crisis?
Chapter 6: Retiree Health Plans for Public School Teachers
The previous two chapters examined retiree health plans that covered general state employees. In many states, teachers are covered by the same health plan as other state employees. However, in a large number of other states, teachers are covered by separate statewide health. In still other states, teachers’ health plans are managed and financed at the local level. This chapter provides a more detailed assessment of retiree health insurance for public school teachers. Because teachers represent such a large proportion of public employees in most states, it is important to understand how coverage of teachers by retiree health plans influences the annual cost and the unfunded liabilities facing the various states.1 School teachers are a large component of the public sector workforce. Indeed, the employment cost of teachers represents a large part of state and local budgets. As such, assessing the costs of retiree health insurance for teachers is a crucial piece of understanding the role of retiree health insurance in the public sector. Determining the unfunded liability for teacher retiree health plans in the United States is a difficult and complex task. As discussed in previous chapters, we have obtained the actuarial reports for all states that have prepared the GASB statements for plans covering general state employees; however, we have not acquired access to statements for plans provided by municipalities and other local governments. This chapter provides an overview of the financial status of state retiree health plans for teachers based on data presented in state-level GASB 45...
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