This article appeared in the Spring 2017 issue of The Classroom Teacher.

TRS-Care is projected to be insolvent within the next several months if action is not taken during the current legislative session to increase funding, change the structure, or both. To address this problem, Sen. Joan Huffman — who is also chair of the Senate State Affairs Committee that considers TRS-related issues — filed SB 788.

SB 788 restructures TRS-Care by splitting the plan into separate programs for retirees aged 65 and older, and pre-65 retirees. In both cases, only a single level of coverage will be provided, but the pre-65 group will see major changes and very high costs. Under the Senate plan in its current form, a retiree under age 65 would only have access to a high deductible plan with a $4,000 deductible and a monthly premium of $430. Premiums would be phased in, beginning at $250 the first year. (Retirees aged 65+ will be enrolled in a Medicare Advantage plan with better benefits and lower premiums.) The House version (HB 3976) mirrors the structure of SB 788, but the higher level of funding in the House budget would change the numbers to a projected $3,000 deductible and a premium of $370 ($200 for the first year of the phase-in). Both plans require pre-65 retirees to pay their full prescription drug costs until the deductible is met (both drug and medical costs count toward the deductible).

TCTA has received calls from members wondering if they should retire now to ensure that they would not be affected by the changes in law, assuming a “grandfather” provision would be included in the bill. Unfortunately, the TRS-Care proposal as it currently stands would affect all current and future retirees, so retiring now would not make a difference. And in fact, retiring earlier than planned could be more costly, since the restructured plan is far more costly for retirees under age 65.

We always recommend that employees carefully consider their retirement options and make sure that they can afford to live on the annuity they have earned. Many retirees have left the classroom out of fatigue or frustration, or to avoid (actual or potential) changes in the law, but then realized that their retirement checks, especially in light of increasing health care costs, were insufficient for the retirement lifestyle they desired.

The fact that most school employees are not eligible for full (or sometimes any) Social Security benefits, and that TRS does not provide automatic cost-of-living adjustments, are both important factors to consider in making the decision about when to retire. 

NOTE: Those who follow the legislative process know to “never say never.” Situations can change rapidly, and when it comes to retirement and health insurance issues, it is crucial that teachers have the very latest information. If you are considering or nearing retirement, please keep up with TCTA’s regular publications: the daily Capitol Updates at tcta.org, and the emailed eUpdate (delivered weekly during legislative sessions).