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House OKs State Health Plan changes

Posted March 30, 2011
Updated April 14, 2011

— The state House gave final approval Thursday to an overhaul of the health plan that insures about 667,000 state employees, teachers and retirees.

The State Health Plan has run into increasing financial difficulties over the past few years. In 2008, lawmakers scrambled to cover a quarter-billion dollar shortfall. The estimated gap for the coming biennium is more than $500 million.

Senate Bill 265 would cut benefits, raise deductibles and co-pays by around 17 percent and charge workers a monthly insurance premium for individual coverage for the first time.

Employees and teachers could opt for less coverage at around $11 a month or better coverage for $22 a month. Retirees could choose the lower-level coverage for free, but they too would have to pay the $22 premium for the better plan.

State employees’ and teachers’ groups split over the proposal. The North Carolina Association of Educators opposed the premium as a “pay cut” for teachers who haven’t had a raise in years. But the State Employees Association praised provisions that would put the state treasurer in charge of the plan and open its contracts for public scrutiny.

The measure passed the Senate earlier this week. House leaders put it on the fast track and gave tentative OK Wednesday, saying the changes need to be approved by April 1 to give plan administrators time to implement them by the start of the new fiscal year July 1.

Rep. Nelson Dollar, R-Wake, said he doesn’t like the premiums, but he said it was a necessary part of reforming the troubled plan. “Maybe if it had been done a long time ago, we wouldn’t be dealing with the kid of financial situation we are today. But we are where we are,” he said.

House Democrats argued the premiums could be avoided. “We don’t have to put this on our employees. We don’t have to put this on our teachers,” said Rep. Mickey Michaux, D-Durham. “Why not raise the cigarette tax a little bit so it’ll help pay for this situation?”

Rep. Joe Hackney, D-Orange, argued that, between premiums, co-pays and deductibles, the changes in the bill could cost a state employee an additional $1,800 a year.

Republicans responded that things are no better in the private sector. “Folks out in the real world are seeing 30 and 40 percent increases in their insurance coverage,” said Rep. Jerry Dockham, R-Davidson. “Luckily, ours has not been that much.”

Democrats also protested the removal of wellness provisions they instituted in 2009, cutting benefits for workers who are obese or who smoke. But Dollar said the provisions weren’t effective.

“They’re all sticks and no carrots," Dollar said. "They don’t incentivize people to live healthier lives, which is what we need to do.”

Dollar said he’s hopeful that, under the treasurer and a new oversight board, the health plan can develop a better wellness program. He also touted the open records provision, which makes the plan’s contracts with Blue Cross Blue Shield of North Carolina and other providers available to the public.

“Taxpayers are finally going to get to see what they’re paying for. That’s critically important,” Dollar said.

If the bill passes the House, it will go back to the state Senate for one more vote there, and then on to the governor’s desk.

213 Comments

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  • crazywater Apr 1, 2:18 p.m.

    >>>>Why not raise the cigarette tax a little bit so itll help pay for this situation?

  • sg0544 Apr 1, 11:10 a.m.

    As for the average wage numbers cited in the BLS news release, that has nothing to do with pay raises. For example, say you have 10 employees. Four of those employees make $2/hr, 2 make $3/hr, 2 make $4/hr, 1 makes $5/hr, and 1 makes $7/hr. The average wage for those workers is $3.40. Five of those employees are laid off: 3 that make $2/hr, 1 that makes $3/hr, and 1 that makes $4/hr. Now the average wage for the workers is $4.20. Although the average wage went up, not a single employee got a raise. The change was caused by some employees losing their jobs. (Which by the way, is bad.) You keep citing data that has nothing to do with your claim that "most private sector employees in N.C. have been enjoying 2-3% raises the last few years".

  • sg0544 Apr 1, 11:00 a.m.

    Plenty Coups--If I understand correctly you are saying that we have been in a recession for the last few years, people were being laid off and at the same time most private sector employees have also been receiving raises. That doesn't make sense. Do you understand what a recession is? I don't have to provide proof. You made the claim, but haven't shown anything that suggests employees in the U.S., let alone N.C., have been receiving raises. Some of the articles you referenced actually talk about pay freezes over the last few years.

  • Plenty Coups Apr 1, 9:15 a.m.

    sg0544- "However, your assertion that there was no recession "
    I never once said that. That is a lie.

    "and workers in N.C. have not been dealing with job losses"
    Never said that also.
    "and decreased wages and benefits is ridiculous."

    What is ridiculous is how far you are willing to go to deny what's in front of you to suit your needs. The fact remains, wages are currently going up and have been doing so the last couple of years. Unemployment, while still relatively high, is slowly going down. I'll leave you again with a link to your own BLS website. Read it closely. Table 1 clearly shows increases in the average wage here in NC. (3.2%)This is from the last quarter of 2009. Table 3 compares NC to the rest of the states. Notice how some have negatives (Missouri, Wyoming)-that means wages are going down there. (bad) Notice how most states have positives for the precent change (like NC!!!) That is good.

    http://www.bls.gov/ro4/qcewnc.pdf

  • Plenty Coups Apr 1, 9:06 a.m.

    sg0544-"You have yet to show any data to support your claim that "most private sector employees in N.C. have been enjoying 2-3% raises the last few years"."

    I showed you proof. You seem to try desperately to discount it but never provide clear links to back up YOUR claims. I'm still waiting for any links to support you. Telling me to go to the BLS isn't a link because nothing there backs you up.

    When I tell you private sector jobs are giving raises and show you the surveys- you at first deny it then say "because it includes over seas companies it must somehow be invalid". When I point out that it clearly says US companies, you then say "you should look at NC data". When I look at NC data as available at the BLS website, the data CLEARLY states wages are increasing at a 3.2% rate here in NC. The argument isn't about unemployement rates or comparing NC's wages to the rest of the US, it is about PAY RAISES. Teachers here in NC make far less than other states also!

  • cpa126 Apr 1, 8:54 a.m.

    It is a little vague to me exactly what the changes are going to be in the state health plan, it says that there will be higher co-pays and deductibles and then there is the insurance premium that will have to be paid. It also says that there will be changes in the benefits provided under the policy, but it does not spell out the changes. Therefore, it is dificult to see exactly how much of these changes state employees will have to absorb. What I see here is that whether you are a state employee or not we are all in the same boat and pointing fingers at one group as the cause of the NC State deficit problems is counter productive. I think that the blame is due to mishandling of the taxes that we all pay. Taxes are collected to fund the state expenditures and are supposed to support the repair of roads, schools, etc. Each fund should be separate and a set amount alloted for each fund as the need be and should not be borrowed from, therefore, if you need $300,000. for roads then you use

  • sg0544 Apr 1, 8:39 a.m.

    Plenty Coups--You have yet to show any data to support your claim that "most private sector employees in N.C. have been enjoying 2-3% raises the last few years". If you ever really want to get an accurate picture of the state of jobs/economy in N.C. the BLS website is a good place to start. There is a lot of information, even statistics for years after 2009, about both the U.S. and N.C. (The link I provided was just to get you to the website and get you started. Since wral has a character limit I couldn't put links to every page that has information about N.C. in a post, even if I wanted to.) I have nothing against state employees. Most public sector employees are good people who work hard and do their jobs well. They take care of their families and contribute to their communities. However, your assertion that there was no recession and workers in N.C. have not been dealing with job losses and decreased wages and benefits is ridiculous.

  • sg0544 Apr 1, 8:29 a.m.

    Plenty Coups—“Look at chart 3 for the average wage percent increase here in NC. It was 3.2% for the 4th quarter of 2008-2009 (the last year they have data)”
    First, 2008-2009 is not the last year for which there is data. Second, the news release you cited showed employment in all nine of N.C.’s largest counties decreased between Dec. 2008 and Dec. 2009. It also states average weekly wages in the other 91 counties were below the national average. It does not say anything about pay raises. Comparing the average wage in Dec. 2008 to the average wage in Dec. 2009 is like comparing apples to oranges since the jobs that existed in 2008 weren’t the same jobs that existed in 2009. If more jobs paying less than the average wage were lost than jobs paying more than the average wage there will be an increase in the average wage without any individual's salary changing. Many of the jobs that were lost during this time were lower wage jobs in industries like manufacturing.

  • sg0544 Apr 1, 8:24 a.m.

    sg0544- "Just because a company's headquarters is based in the U.S. (making it a U.S. company) doesn't mean all of its workers are in the U.S.

    "

Plenty Coups—“So? They're still giving out raises.”

    Since workers in China and India don’t pay taxes in North Carolina, the fact that the base pay for those workers has gone up in the last few years has nothing to do with the state health plan for North Carolina state employees. Again, your argument that because workers in China and India are being paid more workers in N.C., many of whom have lost their jobs to workers in China and India, should pay more taxes is absurd.

  • Plenty Coups Mar 31, 7:57 p.m.

    "You've got a union - The NCAE - which is an arm of the NEA. The NEA is the largest union in the USA. Blame them if you don't like what's transpired."

    Still puzzled over this statement. Blame the people who want professional pay for teachers even though they are opposed by all republicans and some democrats?????? Shouldn't I blame the people who oppose them?

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