by J. Fletcher
Close to 850,000 current and retired state workers can start choosing new health care plans on October 17, 2011 — a normally routine process that this year forms part of the largest overhaul of public-employee health care in the state.
As workers consider a new range of 15 plans, the overall reform may reduce the cost of proving health insurance for towns and state employers but also leave workers with complex calculations to work out their changing payments.
Governor Christie’s health benefits policy aims to save money by shifting union members over the long term to high-deductible plans. The most extreme of those plans — being offered to current state workers and also to retirees — will cover health care only after a patient has incurred and paid $4,000 in out-of-pocket costs.
Public workers and retirees must enroll for their plans between October 17th and November 11th.
In July, workers seeking single coverage will start paying between 2.25 and 17.5 percent of their premiums. By 2014, contributions rise to between 3 and 35 percent.
Governor Christie’s administration hopes to save a projected $10 million in 2012 through reforms.
Future savings will depend on how many workers make the shift to less expensive health plans in subsequent years.
The state’s actuaries predict only 2 percent of current workers will shift plans this year.
That reluctance spells potential problems for Christie: His administration is banking on pushing workers to downgrade from comprehensive — or what he calls “Cadillac” — coverage to those high-deductible plans, to save towns and state employers money. But the unions are ready to actively caution against that push.
The state’s unfunded liability, defined as future costs expected in the health system, is $66.8 billion. With so few workers shifting to cheaper plans, the state expects to save only $10 million in this first year.
Union leaders warned their members late last week not to rush to quickly pick a new health care plan, saying a worker’s upfront cost saving could easily be outpaced by medical bills for a health emergency or procedure.
Patrick Nowlan, who represents the Rutgers Chapter of the American Association of University Professors, said his union members would have to grasp the plan changes quickly.
“I’d say, take time. If you pick a new plan with smaller premiums, your co-pays could be going up and obviously in some cases your deductible is very high as well,” he said. “Savings of any kind are not guaranteed.”
Nowland, who sits on the state review commission, says he expects to hear appeals from workers who at some point argue their plans don’t cover everything they want.
“They could be appealing in larger numbers than ever this year,” he noted. “Which is why we’re asking people to really think through, before making a change.”
“I’d also caution them — you know what you have right now,” he went on.
Some state union heads went further, saying they are going to recommend their members not take the high-deductible options, saying they would essentially be “self-insured.”
“I wouldn’t recommend the high-deductible plans to anyone,” said Hetty Rosenstein, area director for the Communications Workers of America.
Total costs for existing health plans have increased by between 9 and 10.5 percent.
But three providers — Horizon, Aetna and Cigna — will each offer two high-deductible plans, one of which will include employer funding of a Health Savings Account, according to details released late last week by the state.
Nowlan said many nuances in the plans were still being ironed out — among them, whether any of the new plans could be considered managed care plans. Part-time lecturers at state colleges are allowed to buy into managed care plans at full cost plus an extra 10 percent charge.
“Those details still aren’t clear,” Nowlan said. “Luckily, enrollment lasts four weeks.”