The numbers reveal California’s unfunded health care crisis

Taming the Health Care Monster
By State Controller John Chiang in the Sacramento Bee | A few numbers to remember: 1.9, 72, 24, 92, 25, 67 and 121. No, they are not related to last week’s lotto, nor are they the residual carnage of a Sudoku factory meltdown. But they are important numbers to remember as Gov. Jerry Brown and lawmakers prepare to tackle a fiscal liability that rivals or surpasses the size of its more high-profile cousins – the state’s unfunded pension liabilities. If left unaddressed, it will sow the seeds of a future budgetary crisis.

The state of California, like many governments, provides health care to its retirees. What the state does not have, regrettably, is a fiscally prudent plan for how to fund these benefits in a manner that minimizes costs for taxpayers and the civic workforce that serves them.

Instead, we pay the minimum amount due each year, or $1.9 billion. This is just enough to cover the state’s portion of annual premiums. As with only making the minimum payment on your credit cards while continuing to recklessly charge away, the shortcoming of this approach is that the debt will keep growing and, eventually, crowd out the household’s ability to pay for other vital needs.

My latest analysis reveals that the price tag for providing retiree health care to our existing state workers as well as current retirees is nearly $72 billion. In the past eight years, the number has ballooned by a stunning $24 billion – $7.2 billion in the last year, alone.

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1 Response to The numbers reveal California’s unfunded health care crisis

  1. Barry Levinson says:

    It seems plain to me that the public unions in California have turned their backs on the taxpayers. Caring and responsibility is a two way street between the taxpayers and those who serve them in public service.

    Although the problem is not new, the public employee unions seems to not care about the tremendous tax burden caused by the huge unfunded liabilities from pension and retiree health care. That is most unfortunate.

    Again I say caring and responsibility is a two way street. The taxpayers of California have shown both their gratitude and their caring for public employees for decades with generous salaries and even more generous benefits which are above and beyond anything that the taxpayers get from their employers. It is now time for public employee unions to show their gratitude to the California taxpayers by making some much needed benefit concessions going forward. I report, you decide.

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