Chair Talk

August 2005

SERA representatives (Alvin Whitfield, Bruce Andrews, John Bantjes, Mary Flannery and I) met with Mr. Dave Fink Director of the Office of the State Employer, Jan Winters (Deputy Director-Civil Service) and Jill Nowicki (OSE). Our discussions involved Health Care issues regarding state retirees. One of our major concerns was the decisions that the State would be making regarding the Medicare Part D (Prescription Drugs) that go into effect on January 1, 2006. The Medicare rules mandate that employers (State of MI) have to adhere to certain time frames depending on what decision the State makes as to how they will precede. There are basically two programs the State is looking at as far as Medicare eligible retirees:

  1. The State would enroll in the subsidy program whereby the Federal Gov.would return/reimburse to the State an amount (28%) of drugs costs for Medicare retirees Nothing would change and prescription drugs would be administered by Express Scripts. The savings to the State would be about $668 per retiree.
  2. The State is exploring the possibility of “folding in” State Medicare retirees into a plan referred to as a PDP (Prescription Drug Plan) with those retirees in the School Employees Retirement System (MPSERS). Currently, the MPSERS prescription plan is administered by Blue Cross/Blue Shield. The State did not estimate what the savings would be if they chose this plan but the inference was that it might be more. Apparently, when we met they were still awaiting the figures from BC/BS.

The above explanations are very simple statements of two very complicated options the State is currently looking at. I am sure that the State will choose the option that saves them the most money. During our discussion with the Mr. Fink, we indicated that we thought the State should go with the Subsidy the first year at least and to use that year to fully explore other options available. As we all know, the second year of a Federal Program is usually filled with more surprises for all involved. A decision as to what option the State chooses has to be made soon. I have been informed that the MPSERS Board may be making their decision at their meeting August 18, 2005.

We have been informed that some State Retirees are receiving applications for the Medicare Part D program. The State has advised us NOT to have retirees fill those applications out until retirees are notified by the State to do so. We asked at the meeting that a “Retirees Bulletin” be mailed to explain what the State was doing as far as the Medicare Prescription Drugs. Hopefully, that communication will be sent in the near future.

It is my belief that Health Care issues and Prescription Drugs are the most demanding issues facing retirees. There seems to be no indications by the State that attempts are being made to reduce our Health benefits. Nearly everyday you can read where other Employers, States, Counties, Cities are reducing Health Benefits for retirees due to escalating costs. I think we need to work closely with OSE and Employee Benefits to safeguard our health benefits.

As soon as we are informed that a decision has been made regarding the Medicare Part D (Prescription Drugs) program, I will inform Chapter Presidents and have the information placed on this website.

Editor’s note: Bob Kopasz is Chair of the Michigan SERA Council. He may be reached at P.O. Box 692, Mt. Morris, MI 48458; phone 810/240-8380

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