Commissioners transfer $5 million to shore up retiree health care
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For the second time since its inception in the 1980s, the Washington County commissioners transferred a substantial amount of money from the general fund to an account covering what are known as “other post-employment benefits trust.”
The allocation made Thursday at the request of the finance department was for $5 million.
Joshua Hatfield, county finance director, said the trust was created in 2011 and it currently contains $12.5 million worth of investments.
The trust specifically covers fringe benefits other than pensions for retirees. In this case, it is for health insurance for retirees.
Late in the previous century – probably in the late 1980s – a board of commissioners instituted a vague policy that provided free health care benefits for spouses and pensioners who had as few as eight years of service with the county.
One former commissioner who was in favor of a rollback of those benefits in 2003 called them “generous to a fault.”
He and his colleagues on the board could not legally cancel the health benefits outright, but the board stopped offering the benefits to those who were hired on or after April 1, 2004.
The policy that was promised to those hired while it was in place remains in effect until the last person covered passes away.
Once the group of former employees is eligible for Medicare at age 65, the county provides a Medicare supplement that is obviously less costly than a standard health insurance policy.
Hatfield said Thursday after the transfer of funds was unanimously approved that the $5 million was not a line item in the county budget approved in December, but it is needed to meet the county’s obligation.
More stringent rules for public employers’ accountability were formed in 2015 as part of the Governmental Accounting Standards Board.
One aspect of reporting on the county’s financial position is noting the amount of other post-employment benefits liability in county audits to show the county is aware of its future obligations and is committed to meeting them, Hatfield said.