Delaware again considering hikes in health care rates for government employees

DOVER — After proposing health care price increases for state government workers earlier this year — and backing away from the proposal following backlash from the employees — state officials are again considering raising co-pays and deductibles.

Currently, about 90 percent of the employees’ health care costs are covered by the state government.
Preliminary discussions have begun with a newly formed task force on what recommendations to issue to the State Employee Benefits Committee and the Legislature.

Deductibles, rates, premiums, cost sharing and efficiency will be among the myriad topics discussed, according to online information on the task force, which consists of several elected officials, other top state executives and union representatives.

“As of now I don’t think anything is off of the table,” said Office of Management and Budget Director Ann Visalli,

Ann Visalli

Ann Visalli

who chairs the task force.

A meeting was held last week, and several public hearings are set for the next five days to allow for state workers to provide testimony.

While a deficit of $70 million to $80 million for the next fiscal year is expected, the panel’s task goes beyond solving that.

“I’m hoping discussions are not just focused on fiscal year ‘17 but also focused on saving money and making changes to replenish the reserve, which has been depleted,” Ms. Visalli said.

In February, officials proposed increases for prescription drugs, co-pays and deductibles. Co-pays would have gone up by $2 to nearly $21, depending on the plan, and individual and family deductibles would have risen by $500 and $1,000, respectively.

State workers and unions pushed back. With lawmakers receiving angry messages, they used their influence to delay a planned vote. After several months of discussion, the benefits committee made mostly minor increases in co-pays and prescription costs. It did not raise deductibles but did cut state coverage of erectile dysfunction drugs.

With those changes and allocation of $21 million in General Fund dollars, the government was able to cover the gap for the current fiscal year. However, problems for the future remained — and still are looming.

The task force will spend time discussing a multitude of options to not only fill the shortfall but to replenish a depleted reserve fund, Ms. Visalli said. If costs drop, money can be put into the reserve, although the prospect of decreased drug prices appears unlikely.

The panel also could recommend specifically setting aside a sum for the reserve.

“If we set the rate and went up X percent and we said, ‘Let’s set the rate at X + 1 percent,’ because we want 1 percent to go into the reserve, I think that’s a great idea and I’d support it, but we’d have to have the agreement of the SEBC,” Ms. Visalli said.

Increasing deductibles and co-pays is not the only way to solve the problem. Improving efficiency and lowering costs also would help. That’s a method supported by Michael Begatto, the executive director of Delaware Public Employees Council 81 and one of the members of the task force.

He believes the union, which represents about 3,500 state workers, was successful in opposing the proposed spring increases. This time around, he is hoping to do something similar.

“The public input at these four meetings that have been scheduled will help us make decisions as well,” he said.

He believes that looking at the examples set by other states and promoting ways to reduce waste and disorganization can help solve the problem without cost hikes.

Rep. Harvey Kenton, R-Milford, had similar thoughts. Rep. Kenton, who is on the task force for the House minority caucus, said he is in favor of cutting expenses if possible.

Ultimately, there’s still time for a decision to be made. The group must make recommendations to the General Assembly and the governor by Dec. 1, and it has several meetings scheduled.

Government employees can provide their thoughts today at Delaware Technical Community College Terry Campus in Dover. Participants can head to the Education Technology Building in Room 727 from 5 to 7:30 p.m..

On Monday, employees can “share opinions” from 5 to 7:30 p.m. in the William Carter Partnership Center’s lecture hall at DelTech’s Owens Campus in Georgetown.

They’ll have two opportunities Tuesday: from noon to 3 p.m. at the Carvel State Office Building’s second-floor auditorium in Wilmington and later at DelTech’s Stanton Campus, conference Rooms A114 and A116 from 5 to 7:30 p.m.

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