As we reported last week, the State Health Benefits Commission (SHBC) posted the final 2025 Local Government Employee Group Rate Setting Recommendation report that was acted on at last week’s meeting. The final Plan Year 2025 rate for local governments is 16.4%.
The final recommended rate change for Local Government Actives is a 14.5% increase for medical and a 28.4% increase for the prescription drug premium rates, for a total increase of 16.3%. The recommended rate change for Local Government Early Retirees is a 15.1% increase for medical and a 33.1% increase for the prescription drug premium rates, for a total increase of 17.9%. The Medicare Retiree medical increase for Plan Year 2024 is 7.0%, which includes both self-insured medical premiums and fully insured Medicare Advantage premiums. The recommended prescription drug rate change in Plan Year 2025 is a 16.5% increase.
The proposed rate increase for Plan Year 2025 for the State Employee Group was changed from 11% to 9.9% and there was no adjustment to the Local Education School Education Health Program at 14.9%.
These adjusted rates are based on a larger Direct Subsidy Payment from Medicare that was underestimated in the Plan Year 2025 design.
As open enrollment approaches, we encourage you to review the report and, given the 7% increase in Plan Year 2024 and the 22% increase in Plan Year 2023, encourage you to review your municipal health benefits plan and consider your options. If your municipality chooses to stay in the SHBP, we encourage you to look at all plan and provider options and consider the cost impacts. As a reminder, there was a special open enrollment earlier in 2024 with a new provider, Aetna, that has similar plans available.
Contact: Paul Penna, Senior Legislative Analyst, ppenna@njlm.org, 609-695-3481, x110.