The new health plans for educators that Senate President Stephen Sweeney unveiled earlier this week will save school boards money, but will they translate into lower property taxes?
NJBIA thinks they should, and Vice President for Government Affairs Chris Emigholz will be working toward that objective. Despite the savings, the question remains:: What’s to stop a school district from simply spending the money it saves on something else besides property tax relief?
“We need to make sure that tax savings are part of the law and not just something we hope will happen if we make these changes to the health benefits program,” Emigholz said.
Sweeney unveiled the plan Monday at press conference with Marie Blistan, president of the New Jersey Education Association (NJEA), saying it will save over $1 billion a year in health benefits for educators. About $400 million of that savings will go to the educators who opt for the new plans in the form of lower premium contributions. The rest, an estimated $670 million per year, is supposed to be government savings which should benefit taxpayers.
“This plan follows the direction of the Path to Progress reforms that the Senate President has developed and championed for almost two years now,” Emigholz explained. “An older version of Path to Progress healthcare savings legislation sponsored by Senate President Sweeney included a provision to ensure that cost savings to local government were matched dollar for dollar in tax savings for local property taxpayers.
“NJBIA will be looking for a similar provision in this bill,” Emigholz said.
NJBIA has not had a chance to review the implementing legislation yet, but indications are the Senate will move quickly. At Monday’s surprise press conference, Sweeney said the new plans should be ready by July. The fact that the NJEA has agreed to the initiative should make it easier to get through the Legislature.
The agreement calls for creation of a New Jersey Educators Health Plan to replace most other plans currently being offered to teachers. And it provides comprehensive coverage for medical and pharmacy benefits with reasonable member co-payments for physician care and 100% coverage for the use of in-network providers.
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 the currently required percentage of premium, Sweeney explained. Those electing to stay in the SEHBP’s more traditional plans will be required to pay more for their healthcare based on a percentage of their premium.
