Other Post-Employment Benefits (OPEB)

Other Post Employment Benefits (OPEB) are benefits that employers provide to their retirees, other than pension benefits. They are usually composed of retiree health care benefits, prescription drug coverage, dental and vision, but may also include life insurance, disability, long-term care and other services.

OPEB Management Strategies

Many municipalities are looking for strategies to manage or reduce unfunded liability associated with OPEB. With growing attention and awareness on unfunded liability and the impact on communities, it is important for you to understand your options.

Based on a report from the Michigan State University Extension Center for Local Government Finance and Policy, there are approximately 334 units of local government that provide retiree health care to their employees. The report, titled Legacy Costs facing Michigan Municipalities, is an update to a 2013 report and features the latest data and analyses of methods to reduce health care and pension liability, along with detailed county information.

MERS currently serves over 300 municipalities with the Health Care Savings Program and/or the Retiree Health Funding Vehicle. In addition, we have partnered with Mercer Marketplace 365 to provide you with access to a private retiree health care exchange.

OPEB Case Studies

We hope case studies from our member base showing how they successfully addressed these issues will be of great use to you.

Municipality Case Study 1

  • City located in Southwest Michigan
  • 1,800 employees
  • OPEB Liability totaled $200 Million
  • Funds set aside were less than total liability

Municipality Case Study 2

  • Township located in southwest Michigan
  • 18 employees
  • OPEB Liability totaled 2.2 million
  • Funds set aside were less than liability total

 View the Managing OPEB Liabilities publication.

Here to Help

MERS offers a variety of options for managing OPEB. Call Your Regional Team to help you choose the strategy that best fits your needs.

Disclaimer: The information contained in this Web site is being made available as a public service. The information is not intended to constitute legal, tax, accounting or investment advice, or to replace official versions of that information. Benefit Estimates or Service Credit Purchase estimates requested through this Web site are not official descriptions of any benefits, and do not represent a promise by MERS to provide any benefit(s) to any person(s). No one can detrimentally rely upon the information provided in, or requested through this Web site. MERS reserves the right to correct any errors, and presents this information without warranties, express or implied, regarding the information's accuracy, timeliness or completeness. If you believe the information is inaccurate, out-of-date, or incomplete, or if you have problems accessing or reading the information, please call MERS at 800.767.6377.