States Face $558 Billion in Unfunded Retiree Health Care Liabilities
Reason’s Out of Control blog notes a new report detailing that states cumulatively face $558 billion in unfunded retiree health care benefits. Pennsylvania doesn’t seem to be in as bad as shape as some other states, but that’s faint praise. PA has $8.66 billion in unfunded liabilities as of 2008. This represents 220% of the state payroll, or annual payments (which the state is not required to make, and can continue the “pay as you go” approach) of $720 million (or 18.6% of payroll). That’s a lot of money.
Note that this unfunded liability is in additional to the looming pension crisis. And it would not only affect state government, buy also counties, municipalities, transit agencies, and school districts.