On Aug. 3 the state Treasury Department released a report from AON, the state’s actuary for its School Employees Health Benefits Plan indicating that the changes from Chapter 44 had resulted in savings of more than $462.7 million.
The Treasury Department’s press release noted that those savings surpassed the $300 million in net savings that are required under the law.
Chapter 44, signed in July 2020, made significant changes to the health benefit plans that school districts must offer to their employees, while simultaneously altering how much those employees contribute to the cost of their insurance coverage. At the time the bill was signed, the New Jersey School Boards Association expressed concerns that Chapter 44 would not result in savings for all member districts.
The Association is continuing to assess the report but reiterated that school districts in the state have had different experiences with Chapter 44.
“We recognize that for many communities, Chapter 44 generated savings for school districts, employees and taxpayers,” said Dr. Timothy Purnell, NJSBA executive director and CEO. “However, we also recognize that many school districts are experiencing the opposite – increased health care costs. In some cases, the premiums for the New Jersey Educator Health Plan are higher than the premiums for the collectively bargained plans previously offered by the districts; in others, the reduction in employee contributions offset any overall premium savings, resulting in increased net costs to the district.
“The bottom line is this: Chapter 44 has had mixed results. We continue to urge the state to reassess these changes and to explore additional mechanisms for delivering school districts needed relief from rising costs.”