Thursday, July 6, 2017

With 6 Days to Go, There is Elaboration Without Collaboration

A concept not on the Regents Agenda
With 6 days to go before the termination of the 70 percent rule at the July 12 Regents meeting, there is an elaboration, but without collaboration, on item F7 by UCOP:


Retiree health benefits are a valuable tool in the University’s recruitment and retention efforts. Access to affordable, high-quality health care coverage in retirement is a priority to the University’s employees and retirees alike, especially in light of increasing healthcare costs. Consequently, the University will continue to provide retiree health benefits. In the December 2010 Regents action, University of California Post-Employment Benefits – An Overview, the University lowered its maximum aggregate contribution toward the retiree health premiums to a floor of 70 percent, to control retiree health costs. As of January 1, 2017, the University’s share of retiree health premiums is at or near the 70 percent floor. Healthcare costs continue to escalate at a pace faster than inflation. Higher healthcare costs along with increases in the number of retirees eligible for retiree healthcare benefits are resulting in escalating pay-as-you-go funding for retiree health care costs.

The cost of the retiree health program is not pre-funded but rather included in the University’s operating budget on a pay-as-you-go basis. Retiree health benefits are not paid from the UCRP trust. Program options, benefits, and rates are subject to change or termination each year and are not accrued or vested benefit entitlements. To provide future flexibility in managing the University’s share of retiree health care costs, this item proposes rescission of the 70 percent floor for the maximum aggregate contribution toward the retiree health premiums as approved by the Regents in December 2010.

This recommendation would apply to all eligible Retiree Health Benefit Program participants, based on their level of University contributions, which is based on their hire date, years of service credit, and other factors. The administration should reassess the level of the University contribution each year, during the annual health plan renewal process and in the context of overall budget resources, salary adjustments for active employees, and cost-of-living adjustments (COLAs) for retirees.


No consultation with the Senate on this matter, and only 6 days to go:

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