Spotlight on Retiree Health Care Benefits for State Employees in 2013


An overview of the health benefits states provide for their retired employees and how they pay for them.

Joshua Franzel, Center for Excellence, and Alex Brown, NASRA
Publication date:
Filed under:
Research Studies
Key findings:
  • Health care as a portion of overall public employee wage and benefit compensation has increased from 10 percent in 2004 to 12 percent in 2012.
  • Fewer state government units offer retiree health care benefits now compared to ten years ago.
  • Retiree health care obligations on a per capita basis vary widely among states.
  • Unfunded retiree health care liabilities are concentrated in a minority of states: of all state retiree health care unfunded liabilities, 80 percent are attributable to 12 states.
  • States use a variety of methods to reduce their retiree health care costs, most commonly shifting more costs to employees and retirees.
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This brief uses recent data to review the health benefits states offer their retired workforces; underlying funding issues; approaches states are taking to pay for retiree health care and address unfunded liabilities; and the policy and program changes states have made to retiree health benefits since 2009.