Health departments and their employees making tough choices now that the General Assembly has passed Bevin's pension bill

Bevin at bill signing (Lexington Herald-Leader photo by Alex Slitz)

Kentucky's health departments and their employees face some difficult decisions in the wake of the pension legislation passed in the recent special session of the General Assembly.

The law written and signed by Gov. Matt Bevin freezes the pension costs of health departments for another year, at 49 percent of payroll, avoiding an increase to 83 percent, which would have forced layoffs and program cuts, and could have put some of them out of business.

But now the health departments must choose whether to stay in the Kentucky Retirement System "at full cost, leave the retirement system by paying a lump sum equal to future projected benefits payments, or buy their way out in installment payments over 30 years," writes David Zoeller of The Paducah Sun.

Marshall County (Wikipedia map)

Zoeller notes that the Marshall County Health Department "has already been making tough decisions," such as ending its school-nurse program and cutting its staff by almost 30 percent.

John Cheves of the Lexington Herald-Leader notes, "Public employers that quit KRS will be encouraged through financial incentives to freeze their employees’ pensions so they accrue no further benefits. Instead of a pension, employees will be transferred into a riskier defined-contribution retirement plan, such as a 401(k), with a balance that rises and falls with the stock market, and that retirees can outlive if their money runs dry. . . . Some could lose hundreds of thousands of dollars in anticipated retirement benefits if their pensions are frozen."

Cheves's object example is the Garrard County Health Department, which has seven employees, some of whom are less than 10 years from retirement. "Under the state pension formula, the final decade on the job is crucial to maximizing their monthly retirement checks," he notes, and gives a specific example:

"Cathy Stapleton, a nurse at the health department, is 55 with plans to retire at 62. She doesn’t want her pension to be frozen and replaced with a 401(k) account that would have seven years — not the usual 30 to 40 — to build wealth through compound interest. One ill-timed market crash could sink her." She told Cheves, "It means a lot when you come into a pension. It means you have a retirement where you can count on having that income every month." Getting a new 401(k) plan at age 55 "would be a lot different."

Garrard County (Wikipedia map)

Department Director J Smith told Cheves he will recommend to the Garrard County Board of Health that it stick with KRS and pay the 83 percent. "Telling middle-aged people who devoted their lives to public service that they’re suddenly going to risk financial insecurity in their senior years is not a viable choice, he said," Cheves reports, quoting him directly: “We’re not going to opt out. If we opt out, to me, we’re screwing our employees here. Some of my people have got just a few years left. We expect to get what we were promised. We were promised a pension.”

The department has already eliminated family-planning services, cut health education, "laid off its emergency-preparedness coordinator and a front-desk clerk, and officially eliminated a third position, Smith’s old job, which he still does in addition to being director," Cheves reports. "That means he splits his time between inspecting schools, businesses, septic tanks and the like for safety and cleanliness, and managing the department."

“I’ll admit, our response time is slower now because of it,” Smith told Cheves. “When people used to call in for a site evaluation, we usually could get out there the same day. Now it might take us a week. It’s just — I’m sorry, we don’t have the people we used to. . . . I told our Board of Health that if we want to keep the services we have left, we’re going to have to have a tax increase.”

Kentucky River District Health Department
service area: Wolfe, Lee, Owsley, Leslie,
Perry, Knott and Letcher counties (KRDHD map)

Using local tax dollars to fund public health would result in huge inequities, said Scott Lockard, director of the Kentucky River District Health Department, which covers some of the state's poorest and unhealthiest counties. "Communities that need public-health services the most, that have the highest poverty rate, that have the poorest health outcomes, also have the least ability to raise local revenue," Lockard told Kentucky Health News in June.

State Senate panel OKs bill to deny most taxpayer dollars to Planned Parenthood; Ky. affiliate gave up funding in 2015

Feb. 22 Update : SB 8 passed out of the full Senate with a 31-6 vote and now heads to the House for consideration. 

By Melissa Patrick
Kentucky Health News

FRANKFORT, Ky. – A bill that would effectively deny most tax dollars to Kentucky's Planned Parenthood locations in Louisville and Lexington passed out of a state Senate committee Feb. 17.

Senate Bill 8 would create a three-tier system to direct how federal family planning dollars are distributed in the state, with money first going to community health departments and federally qualified health centers, followed by private organizations that provide comprehensive primary and preventive health services, with Planned Parenthood third in line.

In 2015 Planned Parenthood's Kentucky affiliate stopped accepting its federal funding of about $300,000 per year, but Wise said the law is still necessary because "there is currently nothing in law that should prohibit them from in the future needing access to Title X family funds."

The bill would prohibit Planned Parenthood from receiving state or local funds, but it could still be paid by Medicaid, which is mainly funded by the federal government. Federal money does not pay for abortion.

Sen. Max Wise

The bill passed 8-3 along party lines out of the Senate Veterans, Military Affairs and Public Protection Committee, though Sen. Julian Carroll, D-Frankfort, said his vote was a "reluctant no" because of concern that it would reduce women's access to health services.

Texas, Kansas and Ohio have similar laws. The legislation wouldn't take effect until Congress repeals a regulation that prohibits family planning money from being allocated through a tiered structure. The U.S. House has already scheduled a vote on that, said Sen. Max Wise, R-Campbellsville, the bill's lead sponsor. It passed the measure Thursday.

“I come before you today thankfully more optimistic about the prospects of protecting unborn life than I was last year when the committee heard this similar bill,” Wise said.

Opponents of abortion have stepped up efforts to defund Planned Parenthood, which performs abortions but not in Kentucky, since undercover videos released in 2015 purported to show that it sells unborn baby parts for profit.

Wise cited the videos as a reason to support the bill, but they have been found to be heavily edited and misleading. FactCheck.org, a nonpartisan service of The Annenberg Center at the University of Pennsylvania, says, "The full, unedited video they cite as evidence shows a Planned Parenthood executive repeatedly saying its clinics want to cover their costs, not make money, when donating fetal tissue from abortions for scientific research." Experts also said the amount of money mentioned in the videos was not enough to create a profit.

Tamarra Wieder, director of external affairs at Planned Parenthood Advocates of Indianan and Kentucky, said in an interview after the meeting. "The ultimate agenda here is not women's health, it's about outlawing abortion and restricting people's ability to choose what's right for them."

Wise said another reason to withhold funding from Planned Parenthood is because it has a "vested, financial interest" in directing women toward abortion, noting that in 2013-14 the organization had provided 323,653 abortions and made 1,880 adoption referrals.

Federal and state law does not allow tax dollars to be used to pay for abortions, but Wise suggested that it is difficult to ensure that this money isn't crossing over for abortion services: "Under Title X grants, abortion providers can pro-rate expenses such as staff and waiting rooms, carving a portion of the fixed cost of the abortion related staff and facilities."

Opponents of SB 8 (L-R) Dr. Mary Sterrett, Sage Martin and
Tamarra Wieder speak to committee (Photo by Melissa Patrick)

The committee chair, Sen. Albert Robinson, R-London, chairman of the committee, had six opponents of the bill to speak for a little over 15 minutes before Wise presented it.

Wieder told the committee that as a military wife, she was referred to Planned Parenthood because the base was unable to care for her gynecological needs.

"As one of the state's leading and most trusted providers of comprehensive reproductive health care, Planned Parenthood in Kentucky serves more than 7,000 patients a year, a vast majority being low-income women of childbearing age," she said.

Sen. Denise Harper Angel, D-Louisville, the only woman on the committee, voted no and said, "With all the serious issues facing Kentucky, I don’t understand why we spend our time just taking away services for the women of Kentucky."

Wise said that if women need family-planning services, they could go to their local health department or federally qualified health center. But Wieder said, "They say you can go to the health department for this care ... and that's not true. Louisville and Lexington, there is no family planning services from the health department, they contract out. . . and that's not unique to just Louisville and Lexington."

The Louisville Metro Health Department confirmed that, and said it contracted with Planned Parenthood until it stopped taking Title X money. It now sends patients to Family Health Centers, which is a federally qualified health center.

Wieder said the FQHCs in Louisville often refers patients to Planned Parenthood for reproductive health services because "they are inundated with patients seeking other services and they don't have experts in the field that can manage that care, so we do get a lot of referrals from the FQHCs throughout the state, and specifically in Louisville and Lexington."