Court: Duluth can cut health benefits for retirees
The city of Duluth won a major victory at the Minnesota Supreme Court Wednesday in a long-running dispute over retiree health care benefits.
In 2008 the city streamlined benefit plans and increased co-pays and deductibles. Two city retirees then filed suit, alleging that Duluth had wrongfully changed their health insurance benefits.
The city had consolidated 100 retiree health plans into a single plan to cut administrative costs. Under the new plan, retirees still pay no premium, but do pay more in co-pays and deductibles.
The two retirees argued they were entitled to the benefits they enjoyed on their last day of work, but the state Supreme Court ruled they're only guaranteed the same benefit as current city workers.
Create a More Connected Minnesota
MPR News is your trusted resource for the news you need. With your support, MPR News brings accessible, courageous journalism and authentic conversation to everyone - free of paywalls and barriers. Your gift makes a difference.
Duluth Mayor Don Ness said the ruling ensures that the city will be able to afford retiree benefits in the future.
"The fact of the matter is that the plan they're on right now is better than what 98 percenht of people have all across this country," Ness said. "It's a very generous plan, they still don't pay any premiums on this plan, but at the same time the city has been able to dramatically reduce our costs of providing that benefit."
Ness said the changes save the city $4 million annually.
Plaintiffs in the case were meeting with their attorney and had no comment immediately after the decision.