Earlier today the State Health Benefits Commission (SHBC) met for a presentation by AON outlining the recommended rate increases for the State Health Benefits Plan (SHBP) for plan year 2026. For plan year 2026, AON has recommended a rate increase of 37% for SHBP Local Governments and 19.7% for SHBP.
The recommended 37% for SHBP Local Governments does not include fully funding the $200 million borrowed to date under c. 66 (law that allowed SHBP to loan funds to SHBP Local Government to meet cash flow) nor bring the claims stabilization reserve up to the required a 2-month balance. But 10% of the 37% is attributed to capturing the $200 million. If the rate was to include paying back the $200 million and bringing the claims stabilization reserve to a 2-month balance, the increase would be 63%.
The recommended increases for Dental plans are 6.1% for active employees and 5.48% for retirees.
The staggering 37% increase for local government participating employers and employees is unsustainable, creating a significant burden for employees, local government employers, and our property taxpayers. Relief and substantive reforms are necessary. We will be working with the administration, legislature, and interested stakeholders to find a common solution.
The AON report was unavailable at the meeting but will be posted shortly. Once it is available, we will provide greater detail.