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Connecticut taxpayers were told in 2017 that the State Employees Bargaining Agent Coalition (SEBAC) agreement would save them billions. Now, a group of state retirees wants to get their hands on some of those savings.  

Part of those savings comes from moving Medicare-eligible retirees into Medicare Advantage, which delivers Medicare benefits through a private insurer. This year, SEBAC negotiated a way back to traditional Medicare, paired with supplemental “wrap” coverage that helps pay expenses such as deductibles and coinsurance. The deal requires retirees choosing that option to pay the additional premium — $379 per person each month. 

Connecticut State Employees for Medicare Choice, a retiree advocacy group separate from SEBAC, wants the state to use savings from Medicare Advantage to lower retirees’ cost of returning to traditional Medicare.

But SEBAC didn’t agree to move retirees into Medicare Advantage in 2017 out of charity. In that same deal, the unions  secured layoff protections, future raises, a $2,000 bonus and a benefits agreement running through 2027. Union members voted to approve that package. Now the group wants a do-over, with taxpayers paying for the change of heart. 

“The state has an obligation to use some of its cost savings to make those people harmed whole,” the group declared in its Sept. 26 update. That includes making traditional Medicare more affordable for retirees who “need or want” it. Somehow, savings sold as a win for taxpayers have become money the group says the state owes its members. 

Senate Majority Leader Bob Duff’s (D-Norwalk) August 2017 CT Mirror op-ed offered a different perspective. Defending the agreement, he highlighted approximately $24 billion in projected savings over 20 years across its pension and benefit changes. He specifically praised changes to retiree healthcare, “producing an immediate and significant savings for taxpayers while gradually shifting more costs on to state employees and state retirees in the future.” 

That was the sales pitch. The public would spend less, and employees and retirees would gradually shoulder more of the cost. The group’s demand would move some of that expense back onto the public. 

Before considering that request, look at what Connecticut already provides. 

According to the state’s 2026–2027 retirement guide, eligible state retirees and their covered Medicare-eligible dependents pay no monthly premium for their existing medical and prescription plan. They can keep that coverage without choosing the $379-a-month alternative. 

A $0 Medicare Advantage plan premium is also available outside state government. But a $0 plan premium does not eliminate the separate Medicare Part B bill — $202.90 a month in 2026. 

Eligible state retirees pay that premium to Medicare, then Connecticut reimburses them through their pension checks. Retirees without employer reimbursement, other assistance or a plan benefit covering Part B pay it themselves. For state retirees, the reimbursement is worth $2,434.80 a year per person, or $4,869.60 for two eligible spouses. 

Connecticut even helps cover the extra Medicare premiums charged to higher-income state retirees and their covered Medicare-eligible dependents. The state reimburses half of the income-related Part B surcharge and all of the income-related surcharge for Part D prescription coverage. Earn enough to owe more for Medicare, and taxpayers still help pick up the difference. 

The savings the group wants to tap totaled approximately $1.85 billion from fiscal 2018 through 2025, according to Yankee Institute’s calculation using the comptroller’s annual SEBAC savings reports. State law requires the comptroller to report whether the deal delivered its promised savings. The total estimates how much more Connecticut would have spent had it kept the old coverage. It is money the state avoided spending, not money it owes retirees. 

But across the entire 2017 agreement, savings still came in roughly half a billion dollars short of projections from fiscal 2018 through 2025. Taxpayers didn’t get everything they were promised. Now the group wants them to surrender more of what they did get.

The retiree group also takes aim at how the comptroller’s office priced the new option. Its October 11 update calls the $379 additional monthly premium the highest in the country and points to three possible explanations — the calculation method, the benefits included and “the lack of any state subsidization of the wrap plan.” 

That last claim runs into a $247-a-month problem. 

That is how much the state will contribute toward each person choosing the wrap, Madi Csejka, communications director for the Office of the State Comptroller (OSC), told Yankee Institute in an October 22 statement. The projected monthly medical cost is $626. Subtract the state’s $247 contribution and the retiree pays $379. 

That supposedly missing subsidy totals $2,964 a year per person, or $5,928 for two spouses choosing the wrap. The group can argue that it wants a bigger subsidy. It cannot accurately describe this one as nonexistent. 

“The $379 per person monthly retiree premium was not arbitrarily established,” Csejka said. With no claims history yet for the new option, OSC’s actuarial consultant estimated costs using medical claims from three groups: older State Partnership Plan retirees, state employees and spouses age 65 and older, and retired teachers with Medicare wrap coverage. The office will review actual claims and reassess the premium each year. 

“Differences in plan design, claims experience, and employer contribution structures can significantly influence what retirees pay,” Csejka explained. 

A lower premium elsewhere does not, by itself, prove Connecticut got the calculation wrong. It could mean different benefits or a larger subsidy. And a larger subsidy would do exactly what this group wants — move more of the bill from retirees to taxpayers. 

“Altering the State’s subsidy could impact the cost of the Medicare Wrap option, but it would not change the underlying cost of providing the benefits,” Csejka said. 

She added, “They may remain enrolled in the existing Medicare Advantage option with no monthly premium, or they may elect the Medicare Wrap option at the additional premium established through the actuarial review.”

SEBAC negotiated the option with members paying the additional cost. The group wants that cost shifted further onto the public. Calling it affordable doesn’t make the expense disappear. It just changes who gets stuck paying it.

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