Illinois Supreme Court to Hear Retiree Health Care Case.

The Illinois Supreme Court agreed on Thursday to determine whether healthcare for retired state workers is protected under the state constitution, stepping into the debate over reining in the state's huge public pension costs.

The high court accepted a direct appeal of a March 19 ruling by Sangamon County Circuit Court Associate Judge Steven Nardulli, who found that state-sponsored retiree health benefits, unlike pensions, are not protected by the Illinois Constitution.

Illinois' efforts to deal with nearly $100 billion in unfunded pension liabilities have been hampered in part by a restriction in the state's constitution, which calls participation in a pension plan "an enforceable contractual relationship, the benefits of which shall not be diminished or impaired."

Nardulli's ruling raised questions about how state lawmakers might deal with retiree health programs, which were underfunded by $33.3 billion at the end of fiscal 2011, according to the state, and are not specifically mentioned in the state constitution.

http://www.nytimes.com/reuters/2013/04/11/us/politics/11reuters-usa-illinois-court.html?hp