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Legislative Updates

Legislative Update No. 71, Session 81
By Tim Lee, Executive DirectorPrinter Friendly ||| Print as PDF

December 12, 2009

Notes from the December 2009 TRS Board Meeting:
Health Care, Prescription Drug Coverage and What Lies Ahead
The Teacher Retirement System (TRS) Board of Trustees met for two days in Austin this week.  Of the many issues discussed, TRS-Care was one of the biggest.
The TRS Board reviewed their health benefits administrator and pharmaceutical benefits manager contracts, both of which end next August.  The TRS staff recommended maintaining the current health benefits contract with Aetna and the pharmaceutical contract with Caremark.
Ronnie Jung, TRS Executive Director, commented that the current program is working well and that none of the other companies bidding on either contract offered TRS retirees more cost savings or better access to care.  Switching to new providers could cause interruptions of service and other transitional issues that, however minor, would not likely be worth taking on while the incumbents are still performing as expected.
Questions have been raised about Caremark and its relationship with the national drug-store chain CVS. Tim Lee, TRTA Executive Director, testified at the meeting and urged the trustees and staff to continue building safeguards to protect all TRS-Care participants. TRS Trustee Phil Mullins asked the TRS staff to promise that, if firewalls could not be established to protect retirees, the entire contractual process would be brought back for board consideration.
Some of the alleged Caremark issues relate to pill-switching, unfair business practices (e.g., Caremark trying to steer its clients into CVS drugstores) and improper use of client information.
Mr. Jung commented that there is no evidence of these activities taking place with TRS-Care participants and that retired teachers appear satisfied with the company’s mail order prescription services.  According to the TRS staff, of the 25,000 mail order prescriptions processed weekly by Caremark, beneficiaries make an average of two complaints by phone and another two in writing.
 
Economic Recovery Continues
The TRS investment team continues to gain ground on the unprecedented losses it experienced last year.  The fund’s value is now reported to be $93 billion – a more than $23 billion increase from February 2009.
The fund is still not actuarially sound, though, and its recovery must continue.  TRS is doing all it can to invest wisely and make the best use of your pension trust fund assets, but it needs help from the Texas Legislature if retirees are ever to expect a permanent increase in their pension checks. TRS is reporting that a state contribution of 7.72% is needed to make the fund actuarially sound, and while that number may fluctuate before the next session, it is nearly assured that the state contribution will need to increase for retirees to receive a benefit adjustment.
 
TRTA All-Member Mailing
The TRTA Board of Directors is as disappointed in the last legislative session as you are.  In response, a special mailing is being prepared to explain to all our members how we can get the attention of the Texas Legislature.
In addition to the information TRTA is sending to all our members, we are also sending letters to all our legislative leaders expressing our dissatisfaction with their performance this last session. There are, of course, many legislators who did all they could to achieve positive results for public education retirees, but the legislature as a whole did not support us.  We intend to point out these failures and challenge our elected leaders to rise up and take a stand for us.
These mailings are already in development and will be delivered just after the first of the year. The information you receive will not only provide guidance as you express your dissatisfaction with your elected leaders; it will also help you ask the right questions as political candidates contact you at home, asking for your vote in the March 2010 primaries.
 
Membership Matters!
The power of TRTA is truly our legions of dedicated members.  Thanks to your support, TRTA membership will likely exceed 70,000 this year for the first time in its history.  We need every public education retiree in Texas to join TRTA!  Our coming fight in the next session will be tough, and the work we do now will build a foundation on which to balance our future efforts.  It is up to us to be the torchbearers, and to hold the line against those who would rather see us weakened and ineffective. Your continued support helps us deliver our message and make a difference. Thank you for doing what you do.

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