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AFSCME to Gov. Rendell: Don't Cut Health Benefits for State Retirees!
Date:1/16/2008

HARRISBURG, Pa., Jan. 16 /PRNewswire-USNewswire/ -- With Gov. Ed Rendell refusing to negotiate his proposed retiree health care changes, David Fillman - Exec. Dir. of the more than 65,000-member Council 13 AFSCME, American Federation of State, County and Municipal Employees -- is mobilizing retiree members to fight back. AFSCME recently sent a letter to 12,000 state employee retirees urging them to call the governor and to send provided postcards urging him to reconsider his plan for retiree health care.

Gov. Rendell's proposed changes will cut prescription drug benefits for state retirees and replace the Retired Employees Health Program (REHP) with a private insurance plan. "The governor made a unilateral decision," Fillman said. "He did not consult with the Legislature or any organization of state workers or retirees. That's unacceptable, especially when the health care of thousands of retirees is at stake."

Daniel Mazus, president of the 12,000-member Retired Public Employees of Pennsylvania (RPEP)/AFSCME Retiree Chapter 13, said, "Our members spent their lives serving the people of this commonwealth. They deserve the governor's utmost consideration."

Rendell announced last fall that he would raise prescription drug co-pays for those retired before 2004. "These are the oldest retirees," Fillman said. "Their wages were much lower than today's and that means their pensions are lower, too. They simply can't afford to pay more for their medicines."

Fillman and Mazus decried Rendell's cancellation of the REHP for state retirees over 65 as a further example of extracting health care savings out of the pockets of the poorest retirees. "The governor has removed these retirees from both the REHP and the regular Medicare program and replaced the combined coverage with private insurance known as Medicare Advantage," said Mazus. "Private MA plans have been getting hefty subsidies from the federal government, so the state can save a few dollars in the short run. But over the years, it will turn into a devil's bargain."

According to Mazus, Medicare Advantage (MA) plans have many disadvantages for retirees, such as more limited physician acceptance and less forgiving appeals processes, compared to Medicare and the REHP. They also have disadvantages for Pennsylvania. MA-plan subsidies are partially paid out of increases in Medicare Part B premiums, which the state covers for low-income Medicaid recipients. In FY2007, this added $6.3 million to the state's Medicaid costs. Meanwhile, many insurance companies saw record profits last year, largely due to the federal subsidies for their MA plans.

"If this isn't bad enough, there are enormous implications for the future of Medicare," Mazus said. "The insurance company subsidies are draining the Medicare Trust Fund and putting the entire system at tremendous risk. It's unconscionable for our state to be a party to this."

AFSCME C13 is the largest public employee union in the commonwealth. RPEP/AFSCME Retiree Chapter 13 is the commonwealth's largest organization of public retirees.


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SOURCE AFSCME District Council 13
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