Legislation that will allow Illinois to change healthcare contribution levels for retired state workers passed both houses of the legislature in May and went to Governor Patrick Quinn, who said he would sign it. Senate Bill 1313 authorizes the Illinois Department of Central Management Services (CMS) to determine employee contribution levels annually. Whatever rate CMS sets will apply to retired lawmakers, judges, and university employees.

Under the existing system, Illinois pays 5 percent of retiree healthcare premiums for every year of service, reaching 100 percent at 20 years of service. As a result, 90 percent of retired state workers pay no premiums for healthcare coverage. That encompasses 78,000 retirees, according to Illinois Representative Sandy Cole.

“This was one of the most difficult votes I have ever had to make, but [I] believe it is necessary to stabilize our state’s health care system for generations to come,” said Representative Cole. “This bill does not take away retiree healthcare benefits, but will require them to contribute to their premium to help offset rising healthcare costs.”

Governor Quinn has called for reforms to the state’s healthcare and pension systems, saying that Illinois “can no longer provide current levels of both pensions and retiree healthcare to employees upon retirement.” According to the Governor, states comparable to Illinois in size and demographics contribute little or nothing toward retiree healthcare costs.

“This legislation will help ensure that our retirees continue to have access to quality healthcare, while also lowering the cost to taxpayers,” the Governor said. “I plan to sign this legislation and look forward to continuing to work together to make the difficult decisions necessary to return Illinois to sound financial footing.”

The law takes effect July 1, 2012.