Agency tasked with managing public employees’ health insurance set to run out of cash

An agency tasked with overseeing health insurance for public employees appears set to run out of money to pay claims Monday after Beacon Hill lawmakers made clear they would not advance a $240 million spending bill to Gov. Maura Healey’s desk in time to replenish funding.

The Group Insurance Commission — which is responsible for health insurance for 460,000 public employees, retirees, and their dependents — warned earlier this year that cash would dry up to pay claims by Monday. Healey filed legislation to refill the commission’s coffers in April.

But a spokesperson for Senate President Karen Spilka said her chamber plans to take up the spending bill Thursday after House lawmakers sent them the $240 million proposal Monday.

“Providing health insurance for the people who serve our commonwealth is one of our most important responsibilities. We are glad that the House decided to take action on this bill, which was filed five weeks ago on April 2,” Spilka’s spokesperson said in a statement.

Spilka’s spokesperson did not say why the Senate planned to take up the proposal Thursday when the chamber held a roughly 10-minute session Monday morning.

The Group Insurance Commission did not immediately respond to a set of Herald questions Monday.

The legislation the House approved is a pared-down version of a $756 million proposal Healey filed last month. At the time, Healey told lawmakers her spending plan included money to address “time-sensitive deficiencies” like the Group Insurance Commmission funding shortfall.

“This legislation provides additional resources for our most time-sensitive deficiencies to ensure the continuation of critical state services and programs,” Healey said in an April 2 letter to lawmakers. “The administration continues to prioritize good fiscal management of the budget, which has been even more important during these times of high inflation and federal uncertainty.”

A spokesperson for House Speaker Ron Mariano said his chamber has been in “close contact” with the Healey administration regarding funding for the Group Insurance Commission.

“The House advanced $240 million for the GIC, ensuring that the commission can continue to provide insurance benefits to current and retired state employees and their families,” the spokesperson said in a statement. “The House Committee on Ways and Means will continue to work through the remainder of the governor’s supplemental budget proposal during the coming weeks.”

Officials at the Group Insurance Commission said rising provider costs and higher demand for prescription benefits like weight loss drugs led to an average $20 million monthly deficit this fiscal year.

At a meeting last month, Group Insurance Commission Executive Director Matthew Veno said the agency wanted to “avoid disruption to our members, our health plans, and to the providers that rely on our prompt payment of claims.”

“We are likewise in the process of meeting with our health plans to make sure that we’re prepared to manage any disruption that may come along our way if there’s delayed action,” Veno said.

Healey’s original spending bill included millions for other programs.

The legislation had $189 million for child care financial assistance programs, $60 million for the Executive Office of Aging and Independence’s direct care services, and $42 million for a residential assistance program for families at risk of eviction.

A Healey spokesperson did not immediately respond to a Herald inquiry.

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