continued Health Care System Redesign: The agreement includes a series of reforms in the employee health care system. If adopted by all bargaining units, these reforms would save $1.27 billion. The components of the health system redesign are:
Health Care Contributions: The agreement includes substantial changes to employee health care contributions bringing public employee benefits more in line with the private sector. The agreement reflects a two percent increase in contributions for Grade 9 employees and below, and a six percent increase for Grade 10 employees and above. (Under the agreement, for example, the state will pay 69 percent of family coverage for a Grade 10 employee and above, and the employee will pay 31 percent. The prior split was 75 percent state/25 percent employee. For individual coverage, a Grade 10 employee and above will pay 16 percent and the state share will be 84 percent. The prior split was 10 percent employee/90 percent state).
Savings: If adopted for the entire workforce, this change will save $165 million per year, and $764 million over the term of the contract.
Health Care Opt Out: For the first time, the state is offering an opt-out option. Health care premiums cost $16,600 for family coverage and $7300 for individual coverage. Employees electing to opt out of the health insurance program must provide proof of alternative coverage and will receive $1,000 or $3,000 for the cessation of individual or family coverage, respectively.
Health Benefit Redesign: The health benefit plan system of co-pays, deductibles, and programs has been redesigned to encourage healthy choices and control costs of pharmaceutical products. For example, for the first time the plan will cover the use of nurse practitioners and “minute clinics” and encourage employees to use these services when appropriate instead of hospital emergency rooms.
Savings: If adopted by all bargaining units, these changes generate $85.5 million annually when adopted statewide, and $361.4 million over the term of the contract.