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Retiree Network News

Articles from the AFT Michigan Forum

Volume 63 No. 3, Summer 2004

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MPSERS Retirement Package Improved

As reported on the Retiree Network page in the last Federation Forum the MPSERS Board was going to meet to consider a number of changes that would negatively impact school retirees. We encouraged people to contact the Board and express their objections. Well, the MPSERS Board met on June 24, 2004 and voted to approve a number of changes to school retirees' health benefits. The MFT&SRP was pleased that the Board did respond to some of our concerns and removed two items from the original list of changes, replacing them with alternatives that are less onerous.
The two items removed from the package were:

Indexing the minimum and maximum co-payments for prescription drugs and medical deductibles, starting January 1, 2006. Adding a new prescription drug deductible of $50, starting January 1, 2005.

The MFT&SRP had objected to the indexation because it did not take into account some potential savings starting in 2006-07 based on federal Medicare changes. Additionally, it did not allow for retiree input into cost changes or Board accountability. Instead of the indexation, there will be one-time increases in 2006 of the medical deductible from $235/470 to $250/500, in the drug retail maximum from $30 to $32, and in the prescription drug maximum of $750 to $800. In years beyond 2006, these costs will remain the same unless the Board takes further action.

The MFT&SRP had said that the prescription drug deductible would create a burden on retirees, coming at the same time of the year when retirees have high energy costs and also have their medical deductibles to pay. The Board decided, based on these concerns, to eliminate the prescription drug deductible and replace its cost savings by increasing the retail prescription drug co-payment from $4 to $7. This will at least, spread cost increases throughout a year and retiree's co-payment costs are capped under the system, providing come protection.

The MFT&SRP was disappointed that the Board did not reduce or at least phase in the medical cost increases. Needless to say, there are still problems with affordability of the package of changes as a whole on retirees.

In addition to the MFT&SRP's letter to the Board, the Board received letters from DAEOE, the Michigan State AFL-CIO and the Retirement Coordinating Committee. The letters were included in the Board's background packet used to make changes.