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Benefits June 21, 2006
CA County Ponders Retiree Health Care Trust
June 21, 2006 (PLANSPONSOR.com) - Officials in
Orange County, California are considering a plan to move
their estimated $1.4 billion retiree health care debt off
their primary financial records into a trust.
Reported by Fred Schneyer
Called a Multiple Employer Trust, the proposal allows the county to meet new accounting rules that require public agencies to disclose their retiree medical costs (See GASB Issues New Standards for Post-Retirement Benefits ), the Orange County Register reported.
Because of the new accounting rules, supervisors are now confronted with either stepping up payments into the system or taking an ax to retiree benefits.
According to the news report, active county retirees – numbering more than 5,700 – are troubled by the possibility of a trust handling their medical needs. Retirees complain that there is no indication of what kind of financial contribution the county would put into such an entity, much less how it would be run.