David Muir

Dave Muir

LACERA’s Boards of Retirement and Investment concluded a four-day series of all-day meetings in January 2017 to review current operations and plan for the future.  This is an annual event, known as the “LACERA Board Offsite Meetings.”  Day Two of the series was dedicated to the retiree health care program.  I’d like to share some of the information from that session.  

The program was kicked off with a quote from Bernie Sanders: “The United States has more people living in poverty than at almost any other time in the modern history of our country.”  That was followed with this startling statistic:  The estimated life-time cost of health care in retirement is $260,000 per person.  You can see what a huge challenge it is for LACERA to provide a health care program for almost 50,000 retirees.

The average life expectancy in the U.S. is 79.56 years. Twenty-five percent of the members in our health care program are over the age of 80.  Fifty members are 100 years or older!

The total monthly premium cost under LACERA’s health care program is a little over $44 million. LACERA does a great job in keeping premium increases at a minimum and is beating the national averages. How is this possible?  LACERA and its health care consultant aggressively negotiate rates every year.  The Board of Retirement, with the help of its consultant, reviews the cost of claims on a monthly basis to identify areas of concern and works with the carriers to keep costs in line. And LACERA’s popular “Staying Healthy Together” workshops provide education to help retirees stay healthy.  If you’ve never attended one, you’re missing out on a very informative and enjoyable event.

I’ve always been impressed with the great health care program we are so fortunate to enjoy.  LACERA is doing a terrific job in managing the costs of the program and making sure we have the very best in health insurance coverage.

In closing, here’s a bit of breaking news. The cost-of-living increase that becomes effective in April will be 2%.

Thanks to all our readers for your membership in RELAC, your PENSION AND HEALTH CARE WATCHDOG.