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Retiree Health Benefits Working Group issues report; President supportive of recommendations

The University of California invests heavily in high-quality health benefits, providing significant value to faculty and staff and enabling UC to express its support for retirees. In January of this year, President Napolitano established the Retiree Health Benefits Working Group, which was charged with exploring potential strategies and developing options for UC leaders to consider to ensure the long-term viability of the retiree health benefits program.

Working in close consultation with faculty, staff and retiree groups across the system, the working group held a series of meetings involving extensive research on and discussion of this complex topic. On July 3, the working group submitted its preliminary report to the president. The president is supportive of many of the group’s recommendations and has agreed to the following:

No significant changes to the retiree health program for 2019

With the group’s guidance in mind, President Napolitano and Systemwide Human Resources (HR) are working together to finalize UC’s retiree health benefits offerings for 2019 — details will be available during Open Enrollment. Given cost estimates for retiree health benefits for 2019, no significant changes in UC’s contribution levels or plan design are anticipated for 2019.

Gradually reduce the UC contribution for eligible retirees aged 65 and older not coordinated with Medicare to levels comparable to Medicare coordinated retirees

There are approximately 1,600 current retirees who either elected in 1976 not to coordinate with Social Security or who are unable to coordinate with Social Security. For this subset of retirees, the UC premium contribution is now substantially higher than for other retirees who elected Medicare coverage. The president accepted the working group’s recommendation to gradually reduce UC’s contribution for only this group over the next three years (from 2019 through 2021) to ensure equity across retiree groups.

Continue to work with members of the working group through 2019

The president seeks continued involvement from members as part of a consultative body that will review options to ensure that UC offers competitive retiree benefits that are financially viable over the long term. This group’s charter will also include active consultation with their respective constituent groups. The president has asked Systemwide HR to continue to evaluate plan and program design strategies to sustain retiree health benefits, which will be shared with this consultative body.

“I would like to thank the working group for their continued service to the university,” said the president. “I am committed to an iterative process and to sharing proposed changes to the retiree health benefits program with the broader UC community.”

About health benefits for UC retirees

UC has a longstanding practice of providing retirees high quality health care benefits, including medical, dental and vision insurance. With an above-market employer contribution to premium costs, UC currently ranks in the top five among comparable universities for its retiree health benefits. Almost 20 percent of UC’s comparator universities provide no contribution at all to health care premiums for retirees. Learn more about UC’s retiree health benefits program.

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