Reply #7: One way to cut a pension is to increase the cost of health insurance [View All]

The State Teachers Retirement System in Ohio used to provide health care coverage as part of the pension at no extra cost to the retiree and the coverage for a spouse was priced at a reasonable level. Now the retiree pays a health care premium and the spouse coverage is more expensive than that available from a private insurer. There are several reasons for this. The usual bad investments, which I do not think included rare coins which were part of the Workers Comp investments and are currently a big scandal, are part of the problem. Another part is some very bad spending habits on the part of the STRS Board including building a fancy new headquarters and paying bonuses to fund managers when the funds they managed suffered losses. Finally, they paid end of year bonuses to current retirees with money they should have set aside for future retirees. If your state/local pensions are exempt programs (that is you did not pay into Social Security) any Social Security you have coming from jobs which you may have had where you did make FICA payments will be subject to an offset and you will not get your full Social Security benefit. Thus, if you thought you could increase your retirement by working two jobs you are out of luck. These rules are complex and how they would be impacted by any of the current schemes posited by the White House is anybody's guess. The only thing that is for sure is that it will be bad news.