State workers to receive insurance refunds from the state due to ruling by the Illinois Supreme Court
Approximately 75,000 retired Illinois workers may be receiving refunds on their health insurance coverage in February next year. The refunds are part of an ongoing legal battle that began centered on a law that was passed in 2012. The law required retired workers to cover the insurance costs with a portion of their pensions. A recent ruling from the Illinois Supreme Court requires insurance companies to return this money to policyholders.
State law increases the insurance costs that consumers have the handle
The law passed in 2012 went into effect on July 1, 2013. Those covered by the state’s Medicare program began paying a 1% surcharge on their coverage, while those not covered by the program paid a 2% surcharge. In July 2014, these surcharges doubled, placing many policyholders under a higher degree of financial pressure. The Illinois Supreme Court ruled that this was unconstitutional, noting that retirement benefits cannot be altered in any way.
Illinois Supreme Court rules that altering retired benefits is unconstitutional
The state has not yet released information regarding how much money will be returned to retired state workers. The ruling by the Illinois Supreme Court may be welcome news to consumers, however, as many have expressed concerns about health insurance costs and state laws that have altered the state’s retirement system. Retired workers have been expressing their concerns over the state’s actions recently, decrying the laws that have gone into effect that have an impact on their pensions and other benefits.
Insurance refunds could be issued as late as February 2015, perhaps earlier if the legal process is expedited
Depending on whether or not the legal process runs smoothly, refunds for retired state workers may be issued as early as two months from now. At the latest, these refunds are expected to begin being issued by February 2015. Some retired workers will receive higher refunds than others, and many of these refunds may come in the form of credit that will offset the future costs of health insurance coverage.