Senate President Steve Sweeney outlined on March 9 a landmark agreement that will produce more than $1 billion in annual savings for taxpayers and educators by providing a new health benefits plan with reduced contributions by school district employees and major cost savings for local property taxpayers.
Details of the plan proposal are still pending formal introduction in the Legislature, but the seven-year plan is expected to address the issues of cost, quality, health and wellness simultaneously. The annual savings are expected to be $670 million for local school districts and $403 million for employees, according to a press release by the Senate Democrats. When the bill language is available, the NJSBA will review it and further assess the impact on districts.
The savings will result from the creation of a new New Jersey Educators Health Plan. This plan will replace most other plans currently being offered to teachers and provide comprehensive coverage for medical and pharmacy benefits with reasonable member copayments for physician care and 100% coverage for the use of in-network providers, according to the release.
New members coming into service and those electing to switch to this new plan will see their payroll deductions tied to a new contribution schedule, based on a percentage of salary as opposed to a percentage of premiums, instead of the currently required percentage of premium. Those electing to stay in the State Employee Health Benefit Plan’s more traditional plans will be required to pay more for their healthcare based on a percentage of their premium as determined under Chapter 78 requirements.
The agreement will also include the creation next year of the Garden State Health Plan, which will offer NJEA members the voluntary option of a plan that produces even more savings with a network of New Jersey-only healthcare providers. It will provide provisions for out-of-state care not available in the state. It is estimated that care delivered outside of New Jersey is 50% to 100% more than the same services offered by New Jersey providers, according to the release.
A March 10 article on the NJSpotlight.com website provided additional background and detail.