The State Health Benefits Commission (SHBC) met this morning and adopted the renewal rates for Plan Year 2026 as Treasury prepares to finalize the open enrollment process.
In July, the League reported that AON, the actuary for the State, recommended rate increases for the State Health Benefits Plan (SHBP) for Plan Year 2026. A rate increase of 36.5% was recommended for SHBP Local Governments and 19.7% for State employees.
The recommended 36.5% for SHBP Local Governments does not include fully funding the $200 million borrowed to date under c. 66 (law that allowed SHBP to loan funds to SHBP Local Government to meet cash flow), nor bring the Claims Stabilization Reserve up to the required two-month balance.
Additionally, the FY26 State Budget included language that required both the State members and Public Employee members of the Plan Design Committee (PDC) to submit proposals to AON to achieve $100 million in recurring savings during the first six months of the plan year 2026, and any potential savings are not reflected in this rate setting.
AON representatives were present at today’s meeting to answer questions; however, they did not provide any insight into the feasibility of the cost savings measures presented by the PDC. SHBC members acknowledged that the PDC’s proposals are still being vetted and may possibly result in the resetting of rates and an additional open enrollment period. Union representatives unsuccessfully presented a motion to delay the adoption of the rate renewal until the PDC proposals have been fully assessed. Subsequently, the SHBC members representing the Administration successfully presented a motion to adopt AON’s recommended rate renewals of 36.5% for SHBP Local Governments and 19.7% for SHBP.
As a reminder, the Plan Design Committee has until September 30 to meet and vote on each proposal that AON determines will result in recurring and actuarially verifiable cost savings. If the Plan Design Committee is unable to reach an agreement, it will immediately begin mediation.
The League will provide any necessary updates as discussions continue.
Contacts: Lori Buckelew, Deputy Executive Director, lbuckelew@njlm.org, 609-695-3481, x112, or Erin Knoedler, Legislative Analyst, eknoedler@njlm.org, 609-695-3481, x116.