Skip to main content

You are here

Advertisement

State Retirees Have a Right to Health Care, Illinois Supreme Court Rules

In a case that has implications for a new Illinois law limiting state workers’ pension rights, the Illinois Supreme Court ruled July 3 that health care for retired state workers is a constitutionally protected right, reversing a lower court’s ruling. The class action against a 2012 law giving the state the right to impose insurance premiums on retired workers was allowed to continue, with the court citing a state constitutional provision that protects public sector workers’ pension benefits. A law passed late last year which limits pension rights and was to take effect last month has been stopped by a lower court pending another class action.

Illinois has the worst-funded state pension plan, with an estimated $100 billion of unfunded liabilities and another $34.5 billion in health care liabilities.

Recently, a state court declined to require New Jersey Gov. Chris Christie to fully fund the state pension as promised. However, the bankruptcy court in the Detroit case allowed the city to reduce pension benefits in the face of the state constitution, which specifically restricts such actions.

When an irresistible force (unfunded pension and health care liabilities) hits an immovable object (state constitutions), something has to give — in the form of higher taxes, fewer services, reduced benefits or some combination thereof.

Advertisement