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California's Retiree Health Care Costs Rising

 
California's Retiree Health Care Costs Rising
Posted March 6th, 2014 @ 5:03pm by KFBK News - Mike Simpson

The state's share of retiree health care costs is rising, and rising fast.

For most lawmakers, pensions are top of mind, but Controller John Chiang says another problem is creeping up on us -- an unfunded liability for medical and dental care of retired state workers. The costs total more than $64 billion. 

He says that figure grew by $730 million last year alone, and more money should be set aside, and devoted to annual payments.

"It's like with credit cards. If you pay a little bit you're going to have to pay more later on because you're going to accrue interest. You're not taking down the cost," Chiang said. 

Unlike pensions, which are largely funded through investments, the state pays the cost of its retiree healthcare directly out of the general fund.

 

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