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Posted on: July 25, 2022

Proposed Increase to State Health Benefits Rates Update

Earlier this week we advised you that the State Health Benefits Commission (SHBC) was scheduled to meet Monday, July 25, via conference call for its Annual Rate Renewal meeting. The SHBC has removed the rate hike proposal from the July 25 agenda for consideration at a later date.
  
While not publicly available, the League and Association of Counties had learned that preliminary rate increases for consideration include a 24% increase for Active Medical, a 3.7% increase for Active Pharmacy, a 15.6% increase in Early Retiree Medical, and a 0.7% increase for Medicare. Early Retiree Pharmacy has a 5.7% decrease. This is clearly an extreme and unsustainable immediate increase that should require the SHBC to review further and look for other avenues to limit the preliminary rate increases. According to recent news accounts, Treasury noted that the “rates for active members and early retirees would likely be increase between 12-20% across the various plans for the upcoming year.”
  
Senate President Scutari, along with Senators Ruiz and Sarlo, issued a statement urging the SHBC to delay consideration of the proposed rate renewal and noted that they “will get engaged in this issue to prevent these exorbitant increases from being approved.” Republican leadership from the Senate and General Assembly issued a statement calling for a special legislative committee to investigate the health care premium increases with Senator Oroho noting, “The 24% premium increase proposed for most active employees will take thousands more out of their paychecks annually and lead to huge costs for local governments that will translate into higher property tax bills for struggling families.” Assemblyman DiMaio stated that “Taxpayers, employees and retirees living on fixed incomes cannot afford the anticipated cost increases for state health benefits on top of what they are paying just to live, eat and work in New Jersey.”
  
 Although we certainly appreciate the SHBC taking the time to reconsider the substantial increases, the League, the New Jersey Association of Counties (NJAC), and the New Jersey Municipal Managers Association (NJMMA) are urging municipalities and counties to remain in contact with the Governor’s Office and their respective legislative delegations as SHBC evaluates alternative proposals to mitigate the impact on property taxpayers and public employees.
  
Contact: Lori Buckelew, Deputy Executive Director & Director of Government Affairs, lbuckelew@njlm.org, 609-695-3481, x112.

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