Preliminary calculations indicate that the Ohio Public Employees Retirement System Defined Benefit Fund earned 14.52 percent in calendar year 2012, while the OPERS Health Care Fund returned 13.75 percent. Investment returns are preliminary pending final review, and do not include private equity and real estate, which lag a quarter.
The actual returns were higher than the 8 percent actuarial return rate we use to meet our pension obligations. OPERS has attained an average annual investment return of 8.97 percent over the past 30 years.
As of Dec. 31, 2012, OPERS assets totaled $80.3 billion, an increase of $6.2 billion over the same date in 2011. As a result of 2012 investment returns and recently passed pension legislation, OPERS has achieved a funded status of 80 percent and an amortization period of 25 years, well within the state-mandated 30-year funding period.
The OPERS 2013 Annual Investment Plan, now posted on our website, provides details about the coming year’s investment outlook. It describes the strategic asset allocation, or the specific investment classes where we seek return, in both the Defined Benefit Plan and the Health Care Plan.
As we stated in a recent blog, both will undergo some change in 2013.
One of the highlights, which the OPERS Board of Trustees recently approved, is a 2.5 percent reduction in the public equity and fixed income allocations in both plans. This made room for 2 percent target allocations in each fund for additional risk parity investment and a new Global Tactical Asset Allocation.
Does this mean my wife wont get booted off of health care in 2014?
Rich,
There are no planned changes to health care for spouses in 2014.
–Ohio PERS
Last year, employees had to retire by 12/31/12 to qualify for the standing COLA. In 2013, employees have to retire by 11/30/13 to be eligible for healthcare under the old system. Why not be consistent and have it be 12/31/13? I know it’s published but most people assume the end of the year is 12/31, and many are missing this information. Why make it confusing?
Great news and fantastic job done by OPERS investment team.
Does this mean yes ,spouse’s will continue to have coverage or no. And where do we turn for Obomacare no one seems to know or care anything about us left out in the cold.
Charles,
Future spousal coverage has been outlined in the Comprehensive Guide to Pension and Health Care Changes on our website: https://www.opers.org/News/ORSC/ABC%20Version%2010.30.12.pdf
The state of Ohio has decided not to set up its own health care exchange as per the Affordable Care Act. We are all awaiting details on the federal exchange.
–Ohio PERS
I Bought 2.8 yrs of Military Service. I can retire June of 2017 with 30 yrs of service counting the years I purchased. Will I have medical insurance at that time and if not when will it begin. Thank You
Jeff,
Military service will not count toward your health care eligibility (unless it happens to be USERRA time).
You do not state your age, but if you are 60 or older, you would qualify for the health care program since you would have 20 or more years of earned service credit. Otherwise, you will need 30 years of qualifying service credit.
Here are the types of service credit that will apply toward health care eligibility for members who retire after this year: contributing service, Ohio retirement systems service, USERRA, unreported time and restored (refunded) service.
–Ohio PERS
I Will be 51 if I retire will the medical ins start after 2.8 yrs or will I need to keep working for 2.8 yrs longer. Thank You
Jeff,
If you want to have health care coverage immediately upon retirement, you will need to work until you have 30 years of qualifying service time.
–Ohio PERS
Have any OUTSIDE financial experts reviewed the risk factors in these “investments”? Generally, if something sounds too good to be true, it isn’t true.
Jim,
Last year was a good year for investors. The Wall Street Journal reported: “After several years of upheaval, 2012 finally gave investors a year many wished for. The year featured slow, steady gains and low volatility, as the stock market overcame a world of worries, sometimes in surprising fashion.”
Regarding your question about risk factors, the OPERS Board of Trustees employs a number of outside investment advisers to provide independent and ongoing review, analysis and recommendations concerning the investments program, including a review of risk factors.
The Board’s current general investment adviser is NEPC, LLC. Please refer to pages 76-77 of the 2011 Comprehensive Annual Financial Report for additional information concerning NEPC’s independent review of OPERS’ investments program.
–Ohio PERS
This is great news. It is more important than ever for retirees to stand together with OPERS to “protect” our retirement from the government. I swear I wil work tirelessly to oust any politician who starts drooling over this money. OPERS invests wisely and has cut our benefits VERY little. Kudos to OPERS.
So you consider opers’s decision to drop spousal health care a VERY little cut , it must not effect you . But it is a MAJOR problem for Opers members who have paid into the system for 25+ years and now their changing the rules in middle of the game so that our spouses will not be covered. Opers says “read the fine print it was never a benefit , spousal coverage not guaranteed”. We trusted the board to protect our interests but they didn’t in this decision. It is a Shame how investments make millions yet retires go into bankruptcy over medical changes.
I only have 29 S.S. credits, but worked 31 years for State of Ohio. How will this effect my health insurance when I reach retirement age 62 (now 56)?
Debra,
If you have 31 years of service credit, you will be eligible for OPERS health care when you retire.
–Ohio PERS