When the School Employees’ Health Benefits Commission proposed insurance rates for 2027, the message could not be clearer: New Jersey’s health coverage crisis has reached a point where “later” is no longer an option.
For non-retired members of the School Employees’ Health Benefits Program, average premium increases are scheduled to exceed 34%, with some plans increasing substantially more. These increases come after years of rising health care costs and growing program instability.
When health costs grow far faster than inflation, the impact extends well beyond employee benefits. Districts that spend more on health insurance find it harder to sustain academics, student support and extracurricular opportunities. District leaders face excruciating budget decisions and struggle to maintain necessary staffing. Students experience the consequences when those rising costs consume resources that would otherwise support their education.
At the same time, school employees cannot be expected to absorb these increases. The educators covered by these plans are also New Jersey taxpayers. They are teachers, bus drivers, paraprofessionals, secretaries, custodians, counselors and nurses. They face the same affordability challenges confronting working families throughout our state.
Cost shifting does not work. New Jersey has tried that approach. Employees paid more, health care costs kept rising and the underlying problem remained unaddressed. Asking educators to pay more is not a solution because it avoids the causes of the crisis.
Purchasing together
Fortunately, a better approach is available and ready for action today.
The Public School Employees’ Health Benefits Trust Act, sponsored by Senators Vin Gopal and Joseph Vitale and Assemblymembers Margie Donlon, Sterley Stanley and Andrea Katz, would create a framework focused on accountability and transparency and leverage the collective purchasing power of New Jersey’s public education community.
The legislation recognizes a basic reality. When hundreds of districts pursue health care coverage separately, they negotiate from a position of weakness. Greater coordination would provide greater leverage and a better ability to control costs immediately and over the long term.
For years, the New Jersey Education Association has argued that rising costs are driven by factors like hospital consolidation, prescription drug inflation, lack of transparency and inefficiencies throughout the health care system. Those are the problems that need fixing.
None of this was caused by educators or students. And none of will be solved by higher deductibles, larger copays or increased employee contributions.
The proposed legislation is no magic wand, though it represents a first step to bend the cost curve in the right direction. It would create the scope, governance structure and accountability necessary for meaningful long-term cost control.
Budget season
The Legislature should not wait until the fall to address this issue. School districts are making budget decisions now. Communities are dealing with the consequences now. Every month of delay makes the problem more difficult and more expensive to solve.
This is an affordability issue for working families. It is a fiscal issue for taxpayers. And it is increasingly an education issue for every community that depends on strong public schools. If lawmakers act now, we have an opportunity to enjoy affordable health care and preserve classroom resources.
Educators, school districts and taxpayers cannot absorb endless increases. Most importantly, our students should not have to pay the price for an unsustainable health care system.
The status quo is untenable. The time has come to stop describing the problem and start solving it.
