At least one city is raising the rates of its 91 retirees (and it is possible that other cities might follow suit for their own needs and reasons). The increase that was to take effect this month will now be spread out over the next three years. It's still a lot of change out of the pocket and tough for former employees to swallow.

The main reason that the city is given for the increase is that some retirees have not been paying the proper share of the premium. The city is picking up around 65% of the premium payments. Retirees are supposed to be paying 35% of the premiums. Some of the retirees have been paying as little as 23%.

The goal is to treat all retirees equally. Unfortunately the reality is that some retirees are now getting hit harder then they every imagined (or could possibly have budgeted to handle). The city needs to balance out the program but understands the hardship that they higher premiums will place on some individuals. Phasing in the higher premiums is designed to help soften the blow.

Some people thought that the recent change over from one insurance company to a new one might have been the cause of the raised premiums. It wasn't. The city did manage to save a significant amount of money with the change but the plans remained the same.

This is just one more reason that people need to plan for their own medical care outside of insurance if at all possible. It is also another reason to have emergency funds planned into your retirement budget. The future prices are almost impossible to accurately predict.