<p class="p1"><span class="s1">A handful of state governments are eliminating or reducing the health benefits they once offered to state workers. </span></p>
<p class="p1"><span class="s1">The cuts come in response to growing medical costs, the aging of the American workforce, and new rules which force governments to be more transparent about how much they owe. </span></p>
<p class="p1"><span class="s1">According to the latest report from the American Legislative Exchange Council (ALEC), nearly all states are unable to afford the retiree health benefits and pensions they promised employees.</span></p>
<p><strong>The same report found that the<span class="s1"> average US pension is funded at about 35% of what it should be. </span></strong></p>
<p class="p1"><span class="s1">“Pension liabilities are really the existential financial threat facing state and local governments today,” says ALEC economist Jonathan Williams. “This is a huge crowding-out area for states, in that pension obligations will threaten future core government areas of spending such as healthcare, transportation, and education. And they also threaten future tax increases.”</span></p>
<p class="p1"><span class="s1">Because the legal protections for pensions tend to be strong, officials in several states are taking aim at retiree benefits to cut down on debt. </span><span class="s1">States like Texas, Michigan, and Connecticut have already pushed workers out of the system by increasing</span><span class="s1"> premiums, reducing benefits, and tightening eligibility requirements. </span></p>
<p>Kansas was more aggressive, announcing in 2017 its decision to charge retirees the full cost of healthcare coverage. The policy caused <span class="s1">75% of participants to drop out and pushed the state’s retiree healthcare liability down from $6.1 million to $508,000.</span></p>
<p class="p1"><span class="s1">North Carolina, which struggles with a retiree healthcare liability of more than $28 billion, will stop offering retiree healthcare benefits to workers hired in 2021 and beyond. </span></p>
<p>&#8212;</p>
<p class="p1"><span class="s1">While these cuts may be states&#8217; only option to avoid bankruptcy, the changes are sure to make it harder for states to find employees. </span></p>
<p class="p1"><span class="s1">“It’s going to make a difficult situation even more difficult,” says Charles Johnson, who works as a corrections official in North Carolina. The facility is currently looking to fill 100 positions.</span></p>