SEHBC Meets to Set Rates for Health Care Next Year
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July 21, 2010
The State Health Benefits Commission and School Employees’ Health Benefits Commission met July 20 at Thomas Edison State College to adopt rate increases for school district and local governments’ contribution to public employees’ health care plans.
School districts will face an average rise of 5.7 percent in health insurance benefit costs. Municipalities will pay an average of 11.7 percent more for benefits next year. State government will experience an average 6.9 percent increase in costs for health benefits, while dental plan costs for all government levels should rise 1.9 percent.
The cost increases will be broadly felt: 355 school districts and charter schools are enrolled in the state system as well as 677 municipalities, counties and authorities.
Increases will vary by governmental unit and will depend on which specific insurance carrier that employees choose and how many are enrolled. The plans cover employees and retirees.
School cost increases are lower because of local layoffs and some enrollees dropping off because they now must pay a portion of their salary toward their health benefits, the consultants said.
How much in premiums employees pay toward their own health benefits are subject to contract negotiations. Legislation enacted in March (P.L.2010, c.2 (S-3)) requires school and municipal employees to pay at least 1.5 percent of their salary toward health benefits when new contracts take effect.
State officials said they did not know how much local governments would save this year or next by having employees contribute more.
An estimate by the nonpartisan state Office of Legislative Services pegged savings at more than $300 million when the law is fully implemented.