Since January 2014, many Georgia schoolteachers and state employees have complained about their health insurance plan, saying they bear a heavier burden in costs.
Last week, the consulting firm Aon Hewitt reported that members of the State Health Benefit Plan pay a greater proportion of health care costs than people covered in six comparable employee plans studied — those of five other Southern states’ plans, plus University System of Georgia workers.
The State Health Benefit Plan (SHBP) covers about 650,000 members, consisting of teachers, other school personnel, state employees, retirees and dependents.
Changes in the health plan, beginning in 2014, limited employee choice to one insurer. State leaders, responding to a groundswell of protests, added a co-pay system, and delivered more insurance choices for members for 2015.
A Facebook group created to protest the SHBP changes, Teachers Rally to Advocate for Georgia Insurance Choices (TRAGIC), applauded the increased choices of health plans when they were announced. But at that time, the group also maintained there was a lack of affordability, citing high deductibles and other employee costs.
TRAGIC reacted swiftly to the new study’s findings.
“The Aon report confirms what the members of TRAGIC have been saying all along: The insurance offered under the SHBP is unaffordable for Georgia’s teachers and state employees,’’ John Palmer, a TRAGIC leader, said in a statement.
The consulting firm study was commissioned by the Georgia General Assembly earlier this year to ascertain “why SHBP’s costs are higher than other comparable government employee health plans.” The study looked at costs for active employees and pre-Medicare retirees.
The Aon Hewitt report also found that in terms of controlling costs, Georgia SHBP was third lowest, on an adjusted basis, among the seven health plans studied. Financial management of the health plan “is at least on par” with other plans, the study added.
But it found that the overall benefits plan design is “relatively lean,’’ producing higher employee cost-sharing (premiums plus out-of-pocket costs), as compared to similar plans in Florida, Kentucky, Mississippi, South Carolina and Tennessee, along with Georgia’s Board of Regents Plan.
“The report placed the high cost for insurance on the SHBP plan designs,’’ Palmer said, adding, “The Affordable Care Act was not cited as a factor.”
TRAGIC has noted that in some years when state revenues are low, Georgia budget writers have raided the financial reserves of the SHBP in order to balance the overall budget.
The report discussed several potential tactics to lower costs, including use of telemedicine, on-site health clinics, and narrowing choices of medical providers.
Palmer said, “The one suggestion that might actually reduce employee costs without reducing benefits would be for the state of Georgia to increase its contribution per employee.”
In another important finding, the consulting firm said that for non-certificate school personnel, such as bus drivers and cafeteria workers, the plan has a shortage of about $40 per member per month. That gap occurs despite the fact that the state has increased the contribution from school districts.
Gov. Nathan Deal’s original budget for fiscal 2016 called for elimination of the benefits for 11,500 part-time school employees who work fewer than 30 hours a week.
The Georgia Legislature, feeling the heat over the unpopular proposal, put the benefits for the non-certificate workers back into the budget. But the legislators shifted that cost — more than $100 million — to the local school districts.
The Aon Hewitt report said that to close the financial gap, the state could charge these school workers a higher premium or reduce their benefits.
Palmer, however, said, “Asking these essential personnel to pay even more is not a viable option.”
“Of all the possible suggestions, the only one that has any chance of bringing the SHBP member costs in-line with other states without reducing member benefits would be for the state Legislature to budget more money to the SHBP,” he said.