Retiree Rally Thursday at State Capitol

by Marilyn Howells

The Coalition of Retired Public Employees will Rally Thursday, February 16 from 8;00 to 12 noon at the West Virginia State Capitol in the  large cafeteria which is easy to find, as it is located near the center of the basement. There are  free shuttles from the parking areas.

Their announcement states, “Breakfast for you provided by CORPE ( Coalition of Retired Public Employees) of which PERSA is a member. Come out and participate; meet other retirees; meet members of the legislature; or just have a good time and a cup of coffee or glass of juice.”  This functions a lot like  an open house  

 This coalition applies to retirees and future retirees (actives)  for state agencies, municipalities, counties, cities,  schools, universities and  colleges, police, fire, and federal agencies. This is an energizing and effective  event for all retired public employees state, county, municipal, and federal. It’s a great way to meet retirees from other groups, union and nonunion.  Assume future retirees are welcome as these interests affect all.  Great way to learn about what’s happening and how to help.  One learns more  in half an  hour  here, than  form months of  scanning news.

Having personally attended several of their past events, I  can attest to the their ability to get things done, and the quality of the event. Delegates and Senators and Governor  are usually  invited to speak, and entertain questions about concerns. Represents of various groups usually have tables with valuable information. It’s actually rather festive and positive.   The  breakfast are very good.

 See http://www.wvpersa.org    or  http://www.facebook.com/#!/events/235836103171661/ 

 

Those who wish often break into groups  lobby for their concerns.

One should note WVPERSA recently fended off  a scary  attempt “BORROW”  pension funds. WVPERA twice went to court to block the state diverting funds from the pension. Their site states, “In the recent 2011 legislative session, another raid on the retirement trust fund, Senate Bill 606, was attempted by the Acting Governor and others to “borrow” $114 million to complete the parkways development of U.S. Route 35 in Mason and Putnam counties. This most recent attempted raid of your pension dollars emphasizes the need for PERSA as a fiscal “watchdog” of these funds which are held in trust for retired public employees.”  See http://www.wvpersa.org/aboutus.html or  http://www.facebook.com/#!/pages/WV-Public-Employees-Retirement-System-Association/150754134954958?sk=wall                   

   *** Also many  may want to support these bills  Info at  WVPERSA. These kind of bills usually don’t pass, and they don’t come near to what is lost in pension value due to inflation, much less PEIA’s take aways. However, on at least one occasion a small pension increase was obtained for the older retirees.  An announcement draws attention to 3 initiatives.

“Take a look at Senate Bill 443 and its comparable House Bill 4381.    These bills reduce state income tax for you by providing an exemption of up to $20,000 beginning to taxable years after December 31, 2012.

House Bill 3023 provides a 3% pension increase for retirees age 70 or older, have been retired at least 5 years and did not receive the 3% increase in 2006.   

House Bill 4339 provides to all annuitants an annual pension supplement of $24 times the retirees' years of credited service as an ongoing benefit. These are good bills for us as retirees. Call the Governor, your Senator and Delegate and ask for their support.”

As with all retirees, public or private, these aging retirees’ pensions are paid with government paper dollars, worth less and less with each passing year. While salaries and therefore the tax base rise with inflation, the pensions actually remain stagnant and decrease in real value with each passing year.  So some type of  COLA  ( Cost of  Living Adjustment is needed).  Should not all retirees  private or public be able to count on a pension that  is not devalued, and in real dollars decreases? Is not  inflation driven in part by government spending and printing of money?  Retirees  do not make inflation, and have no control of the government paper bill monetary system. Sort of  like company script.

Other issues to discuss include PEIA takeaways and premiums  increase of 9% in July and growing to 117 %, more than double by 2015 for  retirees. Also there will  be a 75% copay on all non-preferred  medications starting in July.

For those who can’t attend, or for those who do calls and letters are especially helpful.  Faxes and emails too. http://www.legis.state.wv.us/districts/hd/hd.cfm  provides links.

http://www.legis.state.wv.us/districts/hd/hd.cfmto find you house delegates

http://www.legis.state.wv.us/districts/sd/sd.cfm to find senate delegate to email or call

The above sites have all the needed email links, phone numbers, and address .  You can also send 34 copies in one envelope to the Clerk of the Senate & about 100 copies to the Clerk or the House with a note asking that they be distributed and they will be sent to their offices. This saves postage.  Contact:  House Clerk Gregory Gray Room 212M, Bldg. 1, State Capitol Complex , (304) 340-3200 or Senate Clerk, Darrell Holmes Room 211M, Bldg. 1, State Capitol Complex (304) 357-7800.

PEIA CHANGES UNDER REVIEW AT RALLY

It is  another  issue that has caused concern for many retirees is PEIA .  Each person  has their  own concerns and take on the problems.  This writer  offers a few  observations.  While pensions do not increase,  the PEIA  health care  benefits [(which are deferred  compensation for  decades of  labor and salaries often  among the lowest in the nation  (49th and 50th]  are  further depleted . (This Portion Contains the Writer's Analysis with Opinion)

1.Though many articles/news releases of PEIA  announcing the November 2011  Public Hearings in other  and various publications, trumpeted no premium  increases for employees,  what was not mentioned was there  were premiums increases  for retirees.  The same  retirees who  do have pension adjustments for inflation.   PEIA premiums will raise 9% next year. Of even greater concern is that they are projected to more double by July 1,2015, with increases of 9% x 34% x 21% x 23% equaling 117%  for July 1,2012 through July 1, 015.                ***    34% in one year.   Really!!! 

  
2. Other proposed take aways for retirees for this year, that  were tabled, but we will surely see again, were 400% increase in deductible for Medicare Retirees,   Medical Out-of-Pocket Maximum up to $1350 from $750 a 80% increase, copay on specialist up 50% and double the increase for actives,  and  all outpatient services  up 50 % to $100. This when PEIA is supposed  to supplement gaps in Medicare. So letters and  lobbying should mention these concerns.

3. PEIA is arbitrarily taking away the 70%/30% match for a 55.1%/44.9% match, about a 50% change in ratio to the detriment of the retirees. Of interest are the PEIA Presentation Hand Out (Line 2), Retiree Premium Increase, and the last line Persent Paid by the Retiree: http://www.peia.wv.gov/forms-and-downloads/Documents/news_center/Public_Hearing_Presentation_November_2011.pdf

4. Also the legislature just funded only ½ of the unfunded liability. They have not dealt with the other half. They have ignored their responsibility to fund it.  This is their unfunded liability. Their share for 30 years forward. Yet they are trying to shift a large part of their share to the retirees. [Note: The retirees pay their part through their already high yearly premiums, and for Medicare retirees their PEIA supplement premiums plus  Medicare  premiums. ]  If nothing is done ½ of the unfunded liability , 5 billion dollars in costs, will be  shifted  to the retirees as increased  premiums and lost benefits. That could be  about an average of several thousand (maybe  $2,000  per year) in lost benefits and increased premiums of every retiree and future retiree assuming each lives maybe 25 years past retirement.  More  if the average life expectancy is less. This will not hit evenly.  It will depend on when  one retired, illnesses and future illnesses, how this is distributed between lost benefits increased premiums, etc.  So some will loose even more in benefits, and increased costs, funds they just don’t have.  This is like taking away $2000 or more each year from every retiree’s  already small and diminishing pension , or up  $50,000 plus per retiree.  And the much touted retiree assistance program is based on need. Really. Now they have to apply for a needs based problem to replace the  benefits taken from them.  And how is program funded, The regular PEIA program, not even a separate appropriation. So it’s funded form higher premiums and lost benefits for all retirees, some having only a few  dollars above the line.

 

5. But  worse, the PEIA board voted to  cap employers payments to only a 3% increase per year, regardless of inflation. Remember as PEIA also has to cover increased insurance needs for increased staff, the retiree plan will handle retirees. They have also set a fixed amount plus an inflation factor. Previous years the  governor, Manchin and then Tomblin, have put an amount in their budget,  usually less than what is needed to prevent premium increases and loss of benefits. (These losses compounded year after year have a devastating effect on the insurance, the workers and  retirees. It amounts, these insurance cuts, act like continual and ongoing pay cuts and pension cuts).  Note the governor appoints the board. So instead of the legislature having  voted on all the  takeaways, one position that of the Governor, has been appointing the board and presents the proposed budget. All  the recent takeaways lead right back to Manchin, his appointed PEIA administrator (imported from an large insurance company), the PEIA board appointed by the governor,  and Tomblin who continued the trend.  (Note one doubts a Republican governor would treat workers and retirees better, as some Republicans want to abolish the minimum wage, which would allow workers the privilege to earn less.] The legislature needs to step up and take back control of PEIA.

 

6.  ***Note for next year starting in July 2015, employees  & NON_MEDICARE RETIREES  will have to pay a 75% copay on all nonpreferred drugs, plus many other take ways. Imagine what is in store in future years for retirees).   Yes, you read that correctly. After paying the deductible, one will pay 75% of the cost of often desperately needed medication. There is  a partial list is in the presentation handout.  The takeaways in benefits for active employees were numerous and massive for the plan year beginning in July 2012 , and amounts to a decrease in pay.  

 

7. Plus during the current year employers underpaid the their share with actives at a 79/21 % match, instead of  80/20% match, which I am told  represents an  underpayment of  8 million. (See page 14 of the presentation). They need  to pay the amount they failed to pay, 8 million. Since they kept this extra 8 million from the actives they need to match it at an 80/20 ratio and therefore owe  32 million on that plus the 8 million they underpaid.  

 

8. It’s also been reported that PEIA over  estimated this year’s costs by 7 million. Union representatives  got them to return  7 million of the 42 million in benefits that they were taking away next year, but they have still taken 35 million.  Since they overestimated this year’s costs by 7 million, were not  those faulty numbers are used to project the unfunded liability over the next 30 years?  Would this not be  a $210 million dollar mistake? But as an inflation factor is added to everything, and compound from year to year, would this not  probably represent an over estimation of the unfunded liability of at least ½ billion to a billion? They would  then  have  overestimated the  same unfunded liability they used to  take away benefits.

 

9.  What other  mistakes have they made?     Well, in PEIA’s 2007 Comprehensive Annual Financial Report page 51 Schedule C  it shows Member and Employer contributions and it appears in 2003, 2004, 2005 & 2006 employer contributions were NOT at an 80/20 ratio and the amount unpaid by employers was under by  35.885, 82.562, 103.133 and 81.937 million respectively for a total of 306.517 million  underpaid by employers, while the employers paid an extra 78.299million in 2007, which makes for an STATE/EMPLOYER underpayment for  the years 2003 through 2007 of 228.18 million. Had those payments been made each year, (with 78.3 million taken out in 2007 to avoid the over payment) part of those funds would have begun earning interest in 2003, and at end of 2007 plan year been  worth over 267 million and in 30 years with interest as computed at  5% APR compounded daily =  $1,198,048,896 or 1.198 billion LOST, THAT’S  ABOUT 1/3 OF THE UNFUNDED LIABILTY  as estimated a few years ago.

10. With billions is giveaways in tax breaks to corporations  with excessive CEO/executives with double digits packages, and massive corporate profits,  how odd the state can’t fund promised benefits. It is doing these on the backs of the underpaid state employees and retirees.   Examples: previously approved was 200 million in give-aways and breaks to out of state Penn/Texas based Consol coal. And they planned to do it 4 times more. If this occurs, those lost taxes invested at 5% compounded over 30 years ( the length they’re looking at for the liability) it  would grow to 4.3 billion!!!!  40 to 60 to million in tax breaks to one rich coal to gas corporation/ owners in Mingo. They also voted  a 25 year tax break  of a cracker plant  by  shell.  The tax break  is estimated to be worth 28.5  million in the first year alone. Even without  inflation of the tax break and lost interest on these funds by the state/counties, this one break is worth over  712.5 million. Counting inflation which would increase the give away and lost interest, over the 25 years, it’s a loss of billions. Ask not where you missing health care benefits are going, they’re going to giveaways to coal and gas profiteers. WV  makes over 3 times the energy it needs. It exports coal overseas. This is not about  your  electric/heating bill, nor energy security. It’s about  profits.

11. Medicare Advantage- Other concerns include retirees being forced off Original Regular Medicare, and a private for profit insurance company run Medicare Advantage Plan that does not provide access to all Medicare physicians, hospitals, clinics, nursing homes, and other  providers, as does original Medicare.  So far PEIA has used two private insurance companies to provide  Medicare Advantage plans, Coventry ( a company associated with the PEIA Director’s former employer – surprise surprise) and then Humana.  These private companies made millions at taxpayer, and retiree expense, and CEO’s and multiple executives commonly are given double digit compensation (for what?). During the first year PEIA forced retirees on Medicare Advantage the CEO was given 23 million salary, bonus and stock options.  

 

12. Living Will- Retirees are forced to sign these or pay higher premiums. While living wills/ advance directives are  certainly a good idea,  PEIA which contract for profit companies is forcing this. A real conflict of interest. They also sent out one form for this to cash strapped retirees, many of whom cannot afford a lawyer. The version they send out does not mention a second opinion,  and only requires one physician to say you are terminal or (NOT and) comatose, which they describe as merely unconscious.  Refer to http://peiawatch.wordpress.com for a  discussion of many other problems and concerns with Medicare Advantage and for profit  insurance companies being involved with living wills.

 

 

 

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