8.6% Health Insurance
Premium Increases Possible

Districts that participate in the School Employees Health Benefits Program (SEHBP) would experience an 8.6 percent increase in premiums next January under a recommendation by Aon, the consultant for the state-run medical plan.

The School Employee Health Benefits Commission will act on the recommendation July 21.

Cyndy J. Jahn, NJSBA’s general counsel, is the Association’s representative on the Commission.

Close to half – 48 percent –  of New Jersey’s local school districts participate in the plan. In January 2010, SEHBP-member districts experienced rate increases of up to 25 percent.

To mitigate the financial impact of a second round of premium increases, the commission has been discussing alteration of benefit levels, including changing the program’s basic line of coverage and increasing co-pays for emergency room visits and other services. Some of the changes would require action by the Legislature, however.

The proposed premium increases underscore the significance of a budget cap adjustment for health insurance costs. The state’s new tax levy cap, enacted July 13, provides an NJSBA-supported adjustment for increases in health benefit costs that exceed 2 percent. The administration’s original cap proposal did not include such an exception.

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