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Cost of health coverage varies widely for teachers in different systems

Jo Ann T. Morris, who taught math at Robert E. Fitch High School in Groton for 21 years, spends nearly $500 a month on Medicare for herself and her husband and wonders why the state would promise nearly free health insurance for retired state workers for life.

Retired public school teachers have been paying all or part of their retiree health insurance premiums since the start of the retirement board plan in the mid-1950s. Many state retirees do not contribute toward their premiums, or contribute a few dollars a month.

Who pays what for their retiree health insurance varies according to where a retired teacher is enrolled: the State Teachers' Retirement Board; a school system where the teacher worked; or, in the case of teachers from the state technical school system, the retired state employees health plan.

Some retired teachers qualify for Medicare after age 65, while others do not. Teachers hired before 1986 did not contribute to Medicare, so for those retired teachers, Medicare costs are high.

If Morris, a Mystic resident who retired in 1997, had taught at Ella T. Grasso Southeastern Technical High School in Groton, whose retirees are part of the State of Connecticut Other Post-Employment Benefits Program, she either wouldn't have to pay a premium or might have one of around $11 a month.

"It doesn't make me feel cheated as a teacher. It makes me feel cheated as a citizen and a voter," Morris said. "… It makes no sense to me that anybody would receive free health care for life."

Morris, 72, spends about $484 on the couple's Medicare supplement, which she gets through the Groton Board of Education. The plan would cost her even more, $704 a month, but they each get a $110 subsidy from the Teachers' Retirement Board, which is funded by contributions from active teachers, retirees and the state. Each of those parties is supposed to contribute 33 percent annually, but in fiscal year 2013 and 2014, the state contributed 25 percent.

Gov. Dannel P. Malloy's proposed fiscal year 2015 budget holds the state's contribution at 25 percent instead of 33 percent, as mandated by law.

The majority of retirees are over 65 and qualify for Medicare. Most retired teachers join the Teachers' Retirement Board Medicare supplement plan when they reach age 65, although Morris said she wasn't aware of the plan.

Those who are on the Teachers' Retirement Board Medicare supplement spend about $96 a month for an individual, while those on board of education health insurance plans in southeastern Connecticut, who are for the most part not yet 65, can spend anywhere between $719 and $1,040 a month on the premium, according to Robyn Kaplan-Cho, retirement specialist for Connecticut Education Association, one of the state's two major teachers unions.

Under that plan, a retiree, the retirement board and the state would split the cost evenly, paying about $96 a month.

Edward Rocchetti of Waterford, who participates in the retirement board Medicare plan, finds the $96 affordable. His annual pension in 2012 was $57,107. He worked as a teacher for 15 years and as an administrator for about 20 in several southeastern Connecticut public schools.

Retired teachers who haven't reached 65 or can't collect Medicare because they didn't contribute to it face much higher costs.

In 1986, the federal government enacted a law requiring state employees, including Connecticut's public school teachers, to start contributing to Medicare.

Nancy Wolf, 77, of Stamford retired after 36 years of service as a reading specialist in Greenwich. She went on the Greenwich Board of Education plan when she retired at age 58 and stayed on that plan because she was ineligible for Medicare.

Wolf's retiree health insurance costs $1,150.66 a month, she said. But she gets a double subsidy from the Teachers' Retirement Board, of $220 a month, which reduces it.

"To be honest, I was very careful because I am a Depression baby and always saved money through tax-sheltered annuities and such as soon as they were offered," Wolf said. "But had I not saved all along, I would be having trouble with my monthly expense. I am not living a life of luxury."

Wolf's annual pension for the 2012 calendar year was $68,383 before taxes.

About 1,080 retirees were in the same situation as Wolf as of fiscal year 2012. Another 15,505 retired teachers under age 65 participated in board of education plans, and 18,790 retired teachers participated in the retirement board Medicare supplement.

Wolf is the secretary of the Henry Bernard Memorial Fund, which helps retired teachers in need.

"We are currently paying full health insurance for two people; we were for three," she said.


Special Report: Connecticut Pensions

What it could cost

If the state were to fund the teachers' Health Insurance Premium Account in advance, it would require annual contributions, and its contribution in fiscal year 2012 would have been $184 million.

The projected costs for the state's portion of the Health Insurance Premium Account is $3 billion over a 30-year period that started in 2007.

The projected cost to the state for retired state workers is $16.2 billion over that same 30-year period. If the state were funding the retired state workers' plan in advance, it would need to contribute annually to the Retiree Health Care Trust Fund and would have needed to contribute $1.4 billion in fiscal year 2012.

Sources: June 30, 2012, actuarial report by Cavanaugh MacDonald Consulting LLC; June 30, 2011, actuarial report and April 12, 2013, memorandum by The Segal Group Inc.


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