Unions See No Reason ARP Money Can’t be Used for Healthcare Premium Relief

TRENTON – Several hundred of New Jersey’s essential public workers filled the State Capitol Annex for a boisterous noon rally to protest what could be at least a 20 percent spike in their healthcare premium as early as January of next year. The crowd’s spirited chants, sirens, bells, and whistles echoed beyond the empty corridors of the State Capitol into the surrounding streets of downtown Trenton.

Preliminary action to advance the hike could come as early as later Wednesday at an afternoon meeting of the State Health Benefit Commission.

After two years of a pandemic, that killed dozens of their colleagues and disabled even more, this crowd was angry that the state they had put so much on the line for, was poised to dramatically hike up the cost of their health insurance with an explanation that it was justified because the workers had collectively increased utilization of healthcare services. 

FOOD VERSUS HEALTHCARE

“There’s no way that we should have to choose between healthcare and feeding our families,” Michael Jackson, with AFSCME Council 52 Local 2272 told the energized crowd. “The excuse that there was more usage of our healthcare plan is not in any way a justification of an increase. We all know the biggest reason for these increases was because of the COVID pandemic which we stood on the front lines fighting to keep our communities safe.”

Jackson continued. “All public employers made it mandatory for us to be tested weekly and that’s where these costs came from. New Jersey received billions of dollars [for COVID relief from Washington] and not one cent was allocated to help negate the rise in healthcare costs. Doesn’t this sound like an economic impact of COVID? That’s what the American Rescue Plan was made for, correct?

The loud crowd cheered in response.

The only elected official to address the rally was Trenton Mayor Reed  Gusciora (below) who reminded the crowd that “without the unions, without the workers, the city and the state would be shut down.”

SLOW RATE HIKE EXPRESS

In a statement, Senate Majority Leader M. Teresea Ruiz implored the panels reviewing the healthcare plan premium rate structure not to be in a rush. 

“The financial realities we have faced due to the pandemic have been tough,” Ruiz wrote. “With the recent announcement of a double digit increase for public employee health benefits, the outpouring of concern on this issue is understandable. While nationwide health benefit rate trends have increased roughly 10 percent, New Jersey’s increase absent any solution, could ultimately lead to higher property taxes. We should all be concerned because there are consequences for employees, state and local government, schools and the taxpayers.”

Ruiz continued. “More robust discussions need to occur to find immediate solutions to lessen the financial impact this year and to produce long term cost savings. The committees should put off approval of the proposal to allow for productive negotiations to find these solutions.”

At the rally, behind a sea of CWA red T-shirts that filled the annex was the NJ PBA hospitality trailer with a strong showing of PBA delegates from around the state quite vocal about their opposition to the rate hike. Large contingents from the American Federation of Teachers, the American Federation of State, County and Municipal Employees intermingled with representatives from smaller unions. Throughout the rally the crowd would break out into chants like “all day, all night, health care is a right”.

As Banita Herndon, a nurse at University Hospital and a member of the Health Professionals  and Allied Employees, took to the podium she extended her fist up in the air with a defiance that engaged the crowd looking to vent.

HURTING THOSE THAT HELPED?

“If you are in health care you know about short staffing,” Herndon told the rally. “At University Hospital in Newark we have labored for years under a substandard healthcare shortage and today we are trying to prevent that for us. This hike will make it even more difficult for healthcare workers to get good healthcare. Imagine that—the people working in the trenches.”

Herndon described the “drastic” premium price hike as just another affront to healthcare workers already dealing with the myriad of moral injuries they suffered during the pandemic which also saw a rise in assaults on them.

Katwanna Noble, a member of CWA, works for New Jersey’s Division of Youth and Family Services. She described helping the State of New Jersey maintain its social safety net when it was most challenged during the pandemic.

“State, county and municipal workers were called upon to continue working, often putting ourselves at risk to ensure we continued to serve our communities with critical services and now its time for the state to help those who took the risks to continue serving our communities,” Noble declared. “I agree with Gov. Murphy when he calls for a ‘stronger and fairer New Jersey’ but raising our healthcare costs won’t make New Jersey stronger or fairer.” 

Patrick Colligan, the president of the New Jersey State Policemen’s Benevolent Association, said during an interview that he estimated the healthcare premium hike would translate to a 1.5 percent payout for his members. 

Colligan said that historically, individuals who went into government employment knew they would never get rich “or join an expensive country club” but “we counted on the pension and health benefits to be there but now in Jersey the pension is in peril and the benefits are a complete disgrace.”

Even before the pandemic that claimed the lives of 17 New Jersey PBA members, recruiting police officers was a problem, according to Collegian, who expects the further erosion of benefits to prompt more of his members to leave the profession. 

Debbie White, RN, and president of HPAE said she was troubled by how much higher New Jersey’s premium increases were when compared to the rest of the country.

“That would be our question,” White said. “Just what is the premise for the 21 percent increase when the average of other plans is five to 10 percent. It makes no sense. We’ve gotten no answer to that.”

The proposed hike in the premiums has prompted calls by the unions for additional scrutiny of Horizon Blue Cross and Blue Shield, the state’s healthcare benefits administrator for New Jersey’s self-insured plan.

HORIZON’S CASE

InsiderNJ asked Tom Wilson, HBCBS’s director of communications, to respond to the roiling rate hike controversy and the critique that his company had some culpability for the premium’s skyrocketing. 

“As the State has acknowledged, Horizon does not set rates,” Wilson replied.  “Horizon’s bid for the State contract promised to deliver $200 million in savings achieved by managing the total cost of care and we are fulfilling our promise and our contractual obligations. Our contract includes specific claims cost benchmarks backed by performance guarantees.”

Wilson said that according to the State and its consultants, Horizon had met those cost benchmarks while it scored a “91 percent member satisfaction rating” in the most recent survey.”

As for the rate hike, Wilson said it would have no impact on HBCBS’s bottom line.

“Horizon administers the State’s self-funded health plan and is paid a fixed administrative fee per employee enrolled in the plans,” Wilson wrote. “Changes in the rates charged….do not impact that fee or the total amount that Horizon earns; it is based solely on enrollment and Horizon will not benefit in any way from a change in the rates.”

Back in July, when word of the possible hikes broke, Gov. Murphy told reporters it was linked to “a surge post-pandemic in the pursuit of medical services and medical attention….that’s not unique to New Jersey—this is a phenomenon around the country if not around the world.”

Murphy asserted his administration had “done more than any state in America to make healthcare accessible and affordable than any state in America”  and that the premium hikes were “yet another reminder we have more work to do.”

 

 

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