Carson v. Lake County, No. 16-3665 (7th Cir. 2017)Annotate this Case
Lake County had cash flow of $51 million in 2007. In 2009, it was operating at a deficit; by 2013 its general fund was more than $1 million in the red. The county’s self-insurance fund had a balance of $10 million in 2007; that balance was wiped out by 2013. The county offered retirement incentives to employees age 65 or older. Under one package, retirees were entitled to five years of supplemental health insurance (secondary to Medicare coverage) through Aetna and could return to work, part-time, as at-will employees. In 2013, Aetna informed the county that if retirees working as part-time employees remained on the plan, the plan would no longer qualify for special exemptions under federal law and the county’s costs would skyrocket. The county notified all rehired retirees who were covered by the Aetna supplement that their employment would end. Some sued under the Age Discrimination in Employment Act, 29 U.S.C. 621, and the Equal Protection Clause. The Seventh Circuit affirmed summary judgment in favor of the county. The key criterion that distinguished the terminated employees from other county employees was not their age but rather their participation in the Aetna plan. The county’s action was rationally related to a legitimate state interest: preserving supplemental insurance coverage for its retirees while avoiding further financial hardship.