Other post-employment benefits (OPEB) refers to the benefits, other than pensions, that a state or local government employee receives as part of his or her package of retirement benefits. Typically retiree medical insurance is the most significant OPEB offering, though other benefits such as life insurance are also covered by this umbrella term.
GASB Statements No. 43 and 45 were issued in 2004 with the goal of providing standards for valuing the costs of OPEB liabilities. The statements required states to project OPEB costs into the future, and include actuarially determined projections on how many employees their expected to cover, and how long they were expected to work before drawing benefits. Some of the data points included in the required valuation are the actuarial accrued liability (AAL), actuarial value of assets (AVA), unfunded actuarial accrued liability (UAAL) and annual required contribution (ARC). Valuations are generally conducted at least every two years, though some states provide projections more frequently.
Spotlight On: Retiree Health Care Benefits for State Employees in 2013, NASRA and Center for State and Local Government Excellence (June 2013)
Results of NASRA Survey on OPEB topics (members-only)
Understanding Finances and Changes in Retiree Health Care, Joshua Franzel and Alexander Brown, Government Finance Review (February 2012)
State and Local Retiree Health Benefits, Government Accountability Office (November 2009)
Retiree Health Plans: A National Assessment, Center for State and Local Government Excellence (September 2008)
Best Practice: Ensuring the sustainability of other post-employment benefits, Government Finance Officers Association