Tallahassee Democrat: Cotterell: State-worker health care in the middle of the pack
August 16, 2014
State employee health insurance is a little like the story of Goldilocks, without the bears.
A new study by the Pew Charitable Trusts and MacArthur Foundation says Florida state workers pay premiums that are not too high, not too low, but just about right. Similarly, what they get for their $50 or $180 a month is neither the best nor worst deal among state employees in all states (Pennsylvania for some reason didn’t respond to the survey).
To get to the meat of it, the study found that Florida state employees pay, on average, 13 percent of the cost of their health insurance. The total cost, paid by employers and employees, is $549 for single coverage and $1,242 for family coverage.
That’s a little below the national average of 16 percent. The average total premium — employee contribution plus employer share — was $571 a month for single coverage and $1,238 for family insurance.
Per-employee costs and average state contributions vary widely, state to state. Employees in Hawaii pay 42 percent of their premium costs, and employees in North Carolina pay 38 percent. Those in North Dakota, meanwhile, pay nothing, Iowa and Alaska put 3 percent of premium cost on their employees and Oregon charges its workers 5 percent, according to the Pew-MacArthur study.
So you might say, all things being equal, we’re right in the middle (assuming Pennsylvania isn’t doing something so vastly different, it would skew the averages nationwide). Florida’s 13 percent employee-borne premium average is 3 percent below the national average.
But all things aren’t equal. The statisticians have to control for the “richness” of the insurance plans, family size, coverage exclusions, copayments and a few other factors — like the high-deductible, low-premium options. Also, there are differences like the cost of health care in different parts of the country, the average age and health status of employees and even the use of “wellness” programs by different state governments.
The money is considerable, in government or the private sector.
“The cost of health insurance has become a leading budget driver for employers of all sizes and in all sectors,” said the study. “From 1992 to 2012, the average cost of insuring each employee and dependent doubled, after adjusting for inflation. This increase has led many employers — including states — to review the benefits they provide, benchmark their offerings to comparable employers and seek ways to control costs.”
Nationwide (minus Pennsylvania), the Pew-MacArthur study found that states spent $30.8 billion insuring 2.7 million employee households. It said this is second only to Medicaid costs, in most states’ overall health-care spending.
In Florida, taxpayers have been pretty lucky. State health plan spending has dropped 3 percent, from $1.7 billion to $1.65 billion, from 2011 through 2013, the study said.
The employee share of health insurance hasn’t gone up lately in Florida government, although the subject has been discussed a lot. Senior Management and Selected Exempt employees used to have their premiums covered entirely by the state but the Legislature changed that a few years ago. For some reason, it settled on one-sixth of the standard premium — $8.34 a month for single coverage and $30 for family insurance.
There have been proposals to have all employees pay the same — that is, to raise premiums for the bosses — but nothing has been done. Maybe that’s partly because legislators don’t want to whack them again, so soon after levying a 3 percent payroll tax on employees for the Florida Retirement System.
One big variable in the nationwide study is the “coverage tiers” from state to state. Florida is among a dozen states with two tiers of insurance coverage — single or family, regardless of family size. There’s only one state, Alaska, with the same premium for all employees, whether they live alone, have just a spouse, or support 10 kids.
The most common structure is four tiers of coverage, in 23 states. Those categories are employee-only, employee and spouse, employee with children and employee plus spouse and children.
Employee health insurance will be a continuing budget issue in Florida. State Rep. Jason Brodeur, R-Sanford, had a bill this year that would led to grades of coverage — loosely termed bronze, silver, gold and platinum plans – while giving employees incentives to shop around.
The down side of that is, most people don’t know much about shopping for health care. State workers struggling to make ends meet might opt for the cheapest coverage — then find out too late that it doesn’t meet their needs.
Brodeur got his bill through the House, in a party-line vote, with a week left in the session but the Senate showed no interest in it.
It will be back.
Contact columnist Bill Cotterell at firstname.lastname@example.org
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