Dramatic Increases of State Healthcare Premiums Poised to Hit January 1st

the staff of the Ridgewood blog

Ridgewood NJ,  an unprecedented coalition of government unions, elected officials, the NJ League of Municipalities, NJ Association of Counties, NJ Urban Mayors Association and NJ Conference of Mayors joined to advocate for a solution to impending, dramatic increases to healthcare premium poised to hit January 1^st.  If these hikes go through, it will be devastating to both workers and property taxpayers.

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It is rare that unions and management are completely on the same page. However, the fact that these egregious healthcare premium hikes are so completely unfair to workers, property taxpayers, local municipalities and counties has brought these sides together. For months, the union side of the Plan Design Committee (PDC) has been publicly promoting several significant cost-savings measures that do not involve cost-shifting to the workers. Local governments are now faced with a difficult fiscal challenge mere weeks away – having to pay an additional 20% insurance increase, compounded by an 18% pension increase on top of that. These dual factors will cause property taxes to spike and also pass along significant increases to local and county government workers.

Time is ticking to find a solution to this impending problem. So the unions and local government management are joining together to call for support of a legislative policy proposal consisting of a one-time appropriation to offset increases in the State Health Benefits Plan (SHBP) in 2023.  This plan would also guarantee $100 million annually in true cost savings – not cost-shifting onto employees – which would directly result in benefiting taxpayers.  If the $100 million does not materialize via the PDC, then the proposal empowers the State Treasurer to implement savings unilaterally.  It also provides a brief enrollment period, so union members can accurately assess the impact of their current plan and make informed decisions concerning their health insurance coverage going forward.  (Please find the full plan at the bottom of this document)

“Much of the positive work the legislature has done to stabilize property taxes over the last several years is going to be marginalized if nothing is done to address this massive cost increase in local government health care insurance,” said Charles Wowkanech, NJ State AFL-CIO President.  “It’s not often that unions and local government management see eye-to-eye on an issue, but on this issue we are unified.  It is clear to all stakeholders that if nothing is done, not only will our members and taxpayers see a financial hardship, but ‘kicking the can’ down the road on controlling health care costs will continue to plague taxpayers, towns and counties each and every year to come.  This proposal is an opportunity for significant, meaningful savings that will help to reign in out-of-control health insurance costs.”

“Today we have an unprecedented coalition, representing both labor and management, speaking with one voice and offering a solution to an unprecedented and devastating increase in health care contribution for local governments, local employees and property taxpayers,” said Millstone Borough Mayor Raymond Heck, President of NJ League of Municipalities.  “We urge the Administration and Legislature to engage with this group of partners, consider and advance this solution to benefit our public servants and our property taxpayers.”

“The fair and equitable recommendations proposed by labor and management to mitigate the staggering health benefit rate increases approved by the State Health Benefits Commission (SHBC) earlier this year, afford state leaders the opportunity to provide both immediate financial relief and long-term cost savings for property taxpayers, local governments, and public employees already struggling to make ends meet,” said John Donnadio, Executive Director, New Jersey Association of Counties. 

“This unprecedented coalition between management and labor is offering common sense solutions to avert tremendously negative consequences on taxpayers and public workers,” said Steve Tully, Executive Director, AFSCME NJ Council 63. “These recommendations provide adequate funding to local governments to offset the drastic premium increases for public employees while also addressing the factors that continue to drive health care costs higher. This is a fair solution for taxpayers, local governments and public employees.”

“IFPTE’s locals across New Jersey stand in Solidarity with the larger labor movement in calling for a worker friendly solution to this crisis.  Municipal workers across our State, including those represented by IFPTE, take great pride in public service,” said Sean McBride, IFTPE Local 196 President/Atlantic Area Vice President. “To allow them to have to absorb huge and unprecedented increases to their health insurance premiums is unjust, a cost that these workers simply can’t afford, and could lead to tax increases.  We must to do what’s right by these public servants and find an acceptable solution to this crisis by year’s end.”