Rising insurance rates hammer New Jersey workers

(The Center Square) – Hits just keep coming. And, with more fiscal pain for New Jersey state and school workers.

In less than a week’s time, the State Health Benefits Commission shot up rate increases of 21% for health plans of state workers, and almost 23% on local government benefits. More than 800,000 workers are impacted, and there was a lightning rod last-minute deal involving unions and Gov. Phil Murphy – much to the detest of Republicans.

Then on Monday, the New Jersey School Employees’ Health Benefits Commission increased medical plans 15.6%, and prescription drug plans 10.8%. Even though effective only to those in the state health plan, it still bumps about half of the 600 statewide school districts. Those districts pick up the majority of the costs; translated, that means taxpayers.

In a statement, New Jersey School Boards Association President Irene LeFebvre said, “The move could have a very negative impact on district budgets – and ultimately undermines student achievement.”

Carl Tanksley, acting general counsel for the association and a representative to the school health commission, cast the only vote against approval. It passed 5-1.

The change goes into effect Jan. 1, 2023, a significant timing pointed out by Dr. Timothy Purnell, the school board association executive director.

“School district budgets were finalized last spring,” he said. “Such increases could force boards of education to reduce or remove instructional programs, services and staff that help our students.”

Murphy, a Democrat, drew the ire of Republican leadership on last week’s move with unions. The deal brokered with five labor organizations limits the increase on state employee contributions to 3%, with the state picking up the rest.

Also noteworthy, the agreement applies to state employees, not to local governments that can sometimes pay upward of two-thirds of the total premium on employee health benefits.

In a joint statement, state Senate Leader Steven Oroho, R-Sparta, and state Senate GOP Budget Officer Declan O’Scanlon, R-Holmdel, said the Murphy administration “must seriously consider suggested cost savings ideas advanced by local employee unions and others and provide estimates of the resulting savings, and either support them or explain their refusal. They must share cost estimates for the few plan changes adopted yesterday, as well as the cost to taxpayers of holding employee cost bumps at 3% while taxpayers pick up the balance.

“It is perplexing that they have bailed out state employees without first identifying real savings. And it is beyond belief that they are ignoring property taxpayers and local employees including police and firefighters who worked throughout COVID and have suffered enough.”

Early reaction was worry for local government workers leaving jobs, and questions about New Jersey’s high rates. Insurance is up nationwide; the Garden State increases are more than twice the norm of other states.

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