North Carolina moves to reduce benefits to public workers | Stock photo
Retired public workers in North Carolina will experience a reduction in their benefits and health care catered for by the state in the coming 20 years, according to the Carolina Journal.
Daniel DiSalvo, a Manhattan Institute researcher, expects the benefits to be phased out by 2041.
According to him, unless there is an equal contribution from the workers and the government to the programs, the benefits must be cut.
Besides pension, OPEB includes the benefits that government retirees receive, which includes vision, dental, and medical insurance. The retired public workers’ health care coverage adds up to $1 trillion countrywide.
With 730,000 employees and $34.4 billion in obligation, North Carolina had to come up with ways of dealing with this debt. One of them was increasing the number of service years from five to 20 to qualify for retirement benefits, saving the state billions in debt. In 2017, Republicans passed a bill where every employee hired after 2021 will not receive the coverage.
South Dakota, Kansas, and Nebraska are the other states that managed to erase OPEB liabilities.