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New AFSCME Contract Includes Higher Healthcare Premiums

Changes in the new contract between the state and the largest public employee union are expected to save Illinois $900 million a year. That's when you look at healthcare costs.

Today, state lawmakers are taking the first step to implement the changes from the agreement. Under the new contract, state retirees will start paying for part of their own healthcare premiums.

AFSCME agreed to the three-year deal with the state a few weeks ago. House Democratic leaders said it creates new opportunities to save money on retiree healthcare costs. Here's how:
For people enrolled in Medicare, the state will no longer cover secondary charges, but will instead contract with an outside provider to offer comparable benefits.For retirees who aren't yet eligible for Medicare, but have at least 20 years of service, the state will offer a $500 a month incentive to opt out or give up their state health coverage and find insurance elsewhere. "The opting out has to do with people who have other forms of insurance," AFSCME Council 31 representative Jeff Bigelow said. "If they so choose, they can opt out and get the incentive to do that."

Rep. Barbara Flynn Currie estimates about 15 percent of retirees will choose to opt out. She said the expansion will save the state more than $30 million a year.

Rep. Lou Lang questioned how the state will ensure retirees spend the $500 each month for healthcare. Under the plan, they would have to prove they have credible health insurance coverage.

Under the plan, the changes would take effect July 1.

The House executive committee approved the options this afternoon. The full House will consider the changes next.