During the two, very long years of contract negotiations and arbitration, one subject broached by many members was “lifetime medical”.  When the OPOA initially asked for members’ input via survey, “lifetime medical” was high on the wish list.  Later, during discussions at board level, “lifetime medical” became a constant theme.

Following a period of research and considerable discussion, one method of providing for insurance costs in retirement was identified.  That method is known as The Retiree Medical Trust or RTM.  The RTM idea was born out of a need to improve health benefits after retirement and your desire for “lifetime medical”.

In negotiations, the City was quick to reject out of hand any question of funding “lifetime medical”.  They were, however, less quick to reject the principle of RMT.  Following tough discussions on the issue, the City accepted the RMT idea and agreed to help fund a portion of the Trust’s administrative expenses.

RMT would operate as follows: the Trust would be funded by you, the members, using pre-tax dollars deducted from salary.  Those dollars would be held and invested collectively by the Trust.  Then, in retirement, each member would receive a tax free monthly payment from the Trust to help pay the cost of medical insurance.  This payment would be determined by the individual member’s contributions and the performance of the Trust’s investments.  As things stand now, PERS provides a payment towards the cost of retiree health insurance, but this makes up only about 40% of the monthly health insurance premium.  In time, as the assets of the RMT grow, the monthly payment in retirement would aim to make up the difference between the PERS contribution and the actual insurance premium.    

Your negotiating team succeeded in establishing the principle of the RMT as part of our new MOU with the City. Your representatives at the table were convinced that RMT was the way forward.  It would help protect and secure all our lives after leaving the OPD.  The question now is: do you the member want to go down this route?  A decision needs to be made by the membership as a whole and in the coming months you will be asked to vote on the RMT.  I encourage you to examine the issue.  Consider the pros and cons and make a decision for yourself. Is this a benefit you want in your retirement?

Barry Donelan
Secretary
OPOA

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