Media: “The L.A. District May Owe $13.6 Billion for Health Care & Pensions — and the Strike Made Things Worse. Obamacare Is a Way Out” in The 74

The recent teacher strike in Los Angeles was mainly over policy issues like charter schools, class sizes, and other school support staff. But the agreement largely punted on lingering financial questions like what to do about the school district’s $13.6 billion unfunded obligation for retiree health benefits.

In The 74, I argue that the district should look to the Obamacare markets as one way to focus their spending on the workers who need it the most:

This is where the federal Affordable Care Act comes in. Obamacare provides subsidies on a sliding scale to individuals to purchase health insurance, regardless of age; in 2018, a two-member household earning less than $65,840, or 400 percent of the federal poverty level, would qualify for assistance. If we assume that retirees have no income sources other than their pension (teachers in California do not have Social Security), publicly available data suggest that 87 percent of LAUSD retirees could qualify for Obamacare subsidies.

As I note in the piece, there is some precedence for this. In the 1980s, LAUSD began requiring retirees over age 65 to apply for Medicare benefits, making the district benefits more of a perk than a standalone offering. Districts like LAUSD could now do the same thing with the Obamacare markets and retirees under age 65.