On Wednesday, the Department of Administrative Services told the NH Fiscal Committee that the health plan for the state’s retirees will have a $10.6 million shortfall over the next biennium, largely due to an unanticipated dramatic increase in prescription drug costs. The Department of Administrative Services presented the Fiscal Committee with a number of possible solutions to mitigate the deficit – all of which shift costs to our retirees.
The average state employee pension is around $12,000 and there has not been a cost of living increase in more than six years with little hope for future increases. The legislature has once again failed to fully fund the promised benefits to our hard working dedicated state employees.
Let it not be forgotten that the retirees accepted and remained in state jobs with the promise of quality health benefits fully paid by the employer. Those promises have been broken by the legislature.
We acknowledge that the cost of prescription coverage has been increasing much faster than the average rate of inflation; however, it is unacceptable for the state to raise out-of-pocket expenses solely on the backs of our retirees. The majority of state retirees cannot afford these proposed changes. Changes previously made to the health plan, which shifted costs, have already put some of our retirees in the position of having to choose healthcare over groceries.
We stand ready to work with the state to explore solutions and look at all options; not just those that shift the burden to the retirees. We ask the legislature to take a broader look at the challenge of providing health security to our retirees.