BISMARCK – A third option for state employee health insurance coverage was struck down by the North Dakota State House Thursday.
Senate Bill 2171 would have directed the Public Employees’ Retirement System board to develop a third option for state employee health insurance plans that would provide enhanced coverages for expenses on colonoscopies, breast pumps, and contraceptives. The Industry, Business and Labor committee gave the bill a Do Not Pass recommendation by a vote of seven to three.
The bill carrier, Rep. Mitch Ostlie, R-Dis. 12, Jamestown, said currently employees can choose between the state high deductible health plan, which also provides a state paid contribution to a health savings account, and the main state uniform group insurance, which is a grandfathered plan under the Affordable Care Act, meaning certain coverages are not required to be offered in this plan. The state currently pays the entire family or individual premium for these two options. Ostlie added that the new plan in the bill would be a non-grandfathered plan under the ACA and due to the added coverages, there would be an additional cost to this plan of about $700 more per year which would be paid by the employees themselves.
“Those opposed to this additional plan were concerned that the added benefits would cause too much adverse selection, which will result in increased cost,” said Ostlie. “Also, with this plan being the only option that asks for a cost share to the employees, there was a concern that this would only be temporary, and that as premiums increase, the ask for the state to pick up that added cost would be very likely.”
Rep. Jorin Johnson, R-Dis. 41, Fargo, said the IBL committee was assured by the director of Human Resource Management Services Division and the Chief Benefits Officer for NDPERS that adding this third option would not cause the state to lose its grandfathering status. Johnson said the committee was also told that in the last 30 years more bills have been introduced to require employees to share in the costs.
“There was no opposition testimony,” said Johnson. “The PERS board developed this additional health care plan based on surveys, wants and needs by the employees. It’s paid solely by the employee. It’s voluntary. We’re always looking for additional benefits to entice employees and encourage them to come and work with us. It’s not costing us anything, let’s give them that option.”
“How are the actuaries going to price this plan when they have no idea who is going to use it?” said Rep. Jim Kasper, R-Dis. 46, Fargo. “Once it’s in place and used, I would almost guarantee that there’s going to be way more expenses in costs than premiums collected. That will negatively impact the premium renewal for all of the PERS health plans, and the people who used it one year will go back to the other plan where it’s paid 100%.”
SB2171 had passed the Senate by a vote of 45 to 0 but failed in the House by a vote of 62 to 31.