Les Jones

Health Care > Accounting For Future Healthcare Liabilities

From USA Today via Megan McArdle:

New accounting rules require that governments, starting next year, put a price tag on the value of medical benefits promised to civil servants when they retire. New York City's liability, for example, approaches $50 billion. The city's total budget last year was $53 billion.

"It's no exaggeration to say that elected officials are shocked, absolutely shocked, by the size of these liabilities," says Donald Rueckert Jr., senior vice president and actuary at Aon Consulting, an insurance broker.

The federal government also has a $2.3 trillion unfunded liability for medical and disability benefits promised to civil servants and military personnel who retire. The costs are not the nation's biggest financial problem. Medicare has a $33.4 trillion unfunded liability. Social Security has a $4.6 trillion shortfall.

See also:
- Highly Recommended Article on Europe's Economic Future (deals with Europe's' unfunded liabilities related to its welfare state)