Retired state employees file class action over new health insurance law in Madison County

Bethany Krajelis Jul. 18, 2012, 10:16am


Forty-eight retired state employees filed a class action lawsuit last week in Madison County, challenging a new law that will require retirees to start paying premiums for their health insurance.

The lawsuit was filed July 11, the day after five retirees brought a similar complaint in Sangamon County and about two weeks after Former Fifth District Appellate Court Justice Gordon Maag requested class action status for his constitutional challenge to the new law.

Under the new law, which Gov. Patrick J. Quinn approved on June 21, retired state employees, judges, lawmakers and university workers will have to pay premiums for their state health insurance. Before the new law took effect on July 1, retirees were entitled to free health insurance after four to 20 years of service, depending on their position.

For instance, retired lawmakers didn't have to pay premiums after four years of service while retired judges had to wait six years. State employees with 20 years of service under their belts were also exempt from paying the premiums under previous law.

The Madison County lawsuit includes 48 plaintiffs across the state and names Gov. Patrick J. Quinn, Treasurer Dan Rutherford and Malcolm E. Weems, director of Central Management Services of Illinois, as defendants.

Rodney V. Taylor, an Indianapolis attorney who is licensed to practice in Illinois, represents the plaintiffs along with Ethan Flint of Saville & Flint in Glen Carbon, Morris Lane Harvey of Mt. Vernon and George Tinkham of Springfield.

Taylor said while every county in Illinois would have jurisdiction over the matter, the legal team chose to file the lawsuit in Madison County because some of the plaintiffs live in the Metro East area. He expects more plaintiffs will be added to the suit, which he believes represents members of all of the state's retirement systems.

Like the two other lawsuits, the Madison County class action complaint contends that the new law violates Section 5 of the Illinois Constitution, which refers to membership in the state's pension and retirement systems as an "enforceable, contractual relationship, the benefits of which shall not be diminished or impaired."

"I cannot conceive of any well-meaning, well-reading of this Constitutional prohibition from doing anything other than stopping what the state is trying to do here," Taylor said. "I just can't fathom an argument that would let the state slice away retirement benefits that people already earned."

Although his clients understand that Illinois is in a financial crisis, Taylor said they think it's unfair that the new law takes away benefits they worked to earn, especially since many of them already have health issues and live on structured budgets.

"The ability to promise something and enforce it is what makes the free world go around," Taylor said of contractual relationships. "It's breathtaking that anyone would want to challenge that."

Janet and Roger Mead of Effingham are two of the 48 plaintiffs who brought the suit in Madison County. Janet Mead said Wednesday that she retired from the Illinois Department of Transportation (IDOT) in 1998, shortly after having an aneurysm behind her optic nerve.

She said she worked for IDOT in Effingham for 37 and a half years, starting out as a secretary and retiring as head of the department's bureau of administration. Mead said her husband, Roger, worked as an engineer for the department for 37 years. The two met at IDOT in 1961 and got married in 1967.

Mead, 70, said the couple received an email about the lawsuit from a retired state employee who sends updates to other retirees. She said she didn't have anything to lose by getting involved, noting that she didn't have to pay anything to become a plaintiff in the suit.

"I realize the state is bad in shape, but when we retired, we were under the impression that we were going to have a pension and health insurance," Mead said.

While Mead said she is not opposed to having to pay something for her state health insurance, she remains concerned for the precedent such a change will create. If state leaders can make retirees pay for something they were previously promised to get for free, Mead said she wonders "what else will they try to do to us next?"

"We hope to stand our ground. We want to stand up and be counted," Mead said of the lawsuit. "If we lay down and act like a sleeping dog, we know they will tromp on us hard."

Mead said she does not know how much the new law will require her and her husband to pay in premiums. Under the new law, the Department of Central Management Services will determine how much retirees will have to pay.

These premium payments have not yet been set or approved, but are expected to leave those with large state pensions paying more for health insurance than those with smaller pensions. Mead said she also heard that retirees who use state health insurance as a supplement to Medicare like she does will have lower payments.

Plaintiffs in the Madison County lawsuit, as well as the two other complaints filed in Sangamon County, contend that if approved, classes in all three of the cases could range between a few thousand to 80,000 members.

Illinois Attorney General Lisa M. Madigan's office, which typically defends constitutional challenges against state laws, will represent the defendants in their official capacities.

The Madison County case is Gary McDonal, et al., v. Patrick J. Quinn, et al., No. 12 L 987.

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