Lawmakers agree to maintain retiree benefit subsidy

Both legislative money committees have agreed to cover the estimated $5.3 million needed to maintain the state subsidy for retired state worker health benefits over the next two years.

The Senate Finance Committee voted to increase the assessment on state agencies to cover the shortfall last week. The Ways and Means Committee gave its OK Saturday.

Had they not done so, state retirees would have been hit with about $57 more a month to maintain health insurance benefits.

The remaining issue in the benefits budget is how to cover the cost of commingling state and non-state workers into a single risk pool. Non-state retirees have been hit with huge increases in benefit costs over the past couple of years. They now pay more than $700 a month for benefits and, in most cases, receive no subsidy from their former employers -- which include the Clark County and Carson City school districts.

There are several pieces of legislation which would "commingle" them with state retirees, which would have the effect of lowering their premiums because they would be part of a much larger, more stable insurance risk group.

But unless the state agrees to kick in about $4.5 million a year, the decision would force state workers and retirees to make up that amount either through higher rates or reduced benefits.

That issue will be taken up by the two committees next week.

The committees agreed to the governor's monthly premium contribution of $495.68 next year and $558.07 in 2005 for active workers; $280.78 in 2004 and $316.26 in 2005 for state retirees.

Benefits program director Woody Thorne said those rates should enable them to rebuild the program's reserves to $15.4 million by the end of the biennium and restore the fiscal health of the benefits program.