Costs are rising again for the State Health Benefits Program, which serves nearly 300,000 state employees, retirees and their families in New Jersey, as premiums are expected to rise by approximately 20%.
How to pay for it is the latest debate between elected officials and the unions representing the employees.
The state budget passed this year required unions and state officials to find $100 million in insurance savings. Like so many other cost savings, it’s easier said than done.
Both sides have offered solutions, according to Sue Livio of N.J. Advance Media, but none appear to be enough to solve the funding issue.
A look at some of the ideas.
Administration proposals
- Keep all health plans but increasing deductibles by $1,000, as well as out-of-pocket maximum (single and family) in-network by $1,000 — or eliminate all but two plans and raise co-pays across the board.
- Impose a monthly surcharge of $50 for members with a spouse who has access to other coverage but uses the state plan.
- Limit coverage and charge higher co-pays for GLP-1 drugs for weight loss to members with a body mass index at or greater than 35.
Union proposals
- Adopt “reference-based pricing,” which limits reimbursement rates for doctors and hospitals based on a multiplier of what Medicare program pays;
- Charge higher co-pays for weight-loss medications, ranging from $35 to $50 a month. Drug co-pays currently are $16 a month.
The state’s actuary, Aon Health Solutions will evaluate proposals from both sides and determine which ones will help save $100 million in the $2.9 billion insurance program by January 2026.
If Aon determines neither side’s ideas will save $100 million, it must submit a round of new ideas no later than Sept. 30.
