State employee health insurance premiums to increase for second straight year

Aug. 21--State employees will see another increase in their health insurance premiums next year after the board overseeing the health plan unanimously approved the increase on Wednesday.

The Group Insurance Board approved a 2.7% rate increase for 2021's state employee health insurance premium, the second year in a row the premium has increased after the board approved a 4% increase last year. The rate had not changed for three years prior to last year.

The impact of the 2.7% increase will vary between state government active employees and retirees, according to the state Department of Employee Trust Funds.

Segal Consulting, the board's actuary, found the increase to be less than the national trend for the second year in a row.

According to Segal, the rate would not have changed next year but would have increased by 10.6% in 2023 had the board stuck to its past strategy for drawing down reserves. The board decided to change its approach to drawing down reserves with plans to revisit the policy in November.

Board chair Herschel Day said he would rather "smooth out" premium increases over the next three years.

"I find myself feeling that is easier to accept from a budgetary perspective," Day said. "It gives us maximum flexibility in a time of maximum variability."

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