NC state employees hired in 2021 won’t receive retirement health benefits

State - Regional

CHARLOTTE, N.C. (FOX 46 CHARLOTTE) – State employees in North Carolina hired in the New Year and beyond won’t get health benefits once they retire.

The decision was made as part of the 2017 state budget and says that any state employee hired after Jan. 1, 2021, won’t get the retirement benefit. FOX 46 spoke with NC State Treasurer Dale Folwell on what this means for you.

“20 percent of your viewers’ income is going toward something they don’t know how to value or price,” Folwell said.

Folwell is talking specifically about health care.

“A lot of the savings are going to be wiped out because the cost of health care is going up at a faster pace than anything else,” he said.

Come the New Year, the new state hires, including teachers, will no longer get free lifetime health care when they retire. If the state decides not to follow through with the 2017 decision, it would be responsible for nearly $30 billion in future benefits.

“That is the current value of money that’s going to be paid out over the next 10, 20, 30, and 40 years,” Folwell said.

The change doesn’t affect current state employees.

“Obviously, any erosion of benefits is going to make it more difficult to recruit,” Suzanne Beasley said.

Beasley works with the state employees association of North Carolina and is concerned the loss of retiree benefits will turn away applicants.

“The intention was to help the unfunded liability, but there are other ways to do that now. The clear pricing project would help with that,” Beasley said.

The Clear Pricing Project is a pricing transparency policy. It limits what the state will pay providers.

“Right now, the state of North Carolina, they’re just paying a bill and they don’t have a clue how much that bill is until they get it, and then they just pay it,” said Beasley.

As future state employees’ benefits align with those in the general public, Folewell is projecting it could help save money in the future, and possibly influence the health care market.

“At the end of the day, it’s driving down the cost of healthcare for those that teach, protect and serve,” Folewell said.  

Again, this doesn’t affect current state employees, only future state employees, and it will not affect any pensions.

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