CHICAGO - State and local governments - grappling with how to address the unfunded accrued liability of their other post-employment benefits - face another looming fiscal burden in the coming decade as the federal government is pressured to deal with the skyrocketing shortfall of funding Medicare.

The risk to local and state governments currently in the midst of reporting their unfunded health care liabilities to retirees and future retirees on an accrued basis is that the federal government will shift more of the funding burden to a local level by reducing benefits to the elderly significantly, said Thomas R. Saving, whose seven-year tenure as a member of the Social Security Administration and Medicare Trust Funds ended at the start of 2008.

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