NY School Audits Find Health Benefits For The Dead

ALBANY, N.Y. (AP) -- A state audit showed Wednesday that 10 school districts in New York paid nearly $239,000 to provide health insurance benefits for dead or ineligible retirees over nearly two years.

"Paying health insurance premiums for deceased retirees is not a good way to spend taxpayers' money,'' state Comptroller Thomas DiNapoli said. He noted $117,556 has been recovered.

The audit of 20 districts with high percentages of retirees who don't contribute toward their health insurance costs found that only two had written guidelines to ensure accuracy and appropriateness of insurance payments.

Auditors compared the names of 22,422 retirees and dependents receiving the public schools' health insurance with death records at the Social Security Administration, finding 27 from half the districts who had died, according to the comptroller's office. None were identified at the other 10 districts.

Officials from 16 districts filed comments generally agreeing with the findings. Auditors said they should establish written policies to periodically monitor the status of retirees and dependents with coverage and maintain Social Security and contact information on each.

The Rochester Central School District overpaid $19,429 on behalf of 10 deceased retirees from July 2008 through May 2010, according to the audit. The district recovered $16,301 and told auditors they regularly assess their fiscal operations and would consider the feasibility of added monitoring.

According to auditors, many public school district employees in New York have an option for individual or family health insurance in their retirement packages. Some districts require partial retiree payments for coverage, and most require it from surviving spouses or dependents when a retiree dies.

For the 2008-2009 fiscal year, the 697 school districts statewide reported spending $3.5 billion on health insurance, about 11 percent of their total expenses, with about $1 billion or 30 percent spent for retirees and their dependents.

Auditors surveyed 107 districts and got responses from 61 showing more than one-third of their retirees don't contribute toward coverage. They noted the premiums paid for the deceased, all who had died within the previous three years, represented a tiny fraction of costs.

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