DES MOINES — The Iowa Executive Council voted 5-0 Monday to authorize a new two-year state employee health insurance contract calling for a modest increase in premiums with projected claims of $332.4 million for the plan year beginning next Jan. 1.
The new contract with Blue Cross-Blue Shield would cover slightly more employee contracts (21,442 versus 21,203) with the same plan design now in place and would provide coverage for a projected 54,374 members, said Janet Phipps, director of the state Department of Administrative Services.
“It’s pretty much status quo,” Phipps said. “It maintains our plans. It appears to be competitive with what we have, and we should be doing OK.”
The projected claims were up $2.4 million from the current coverage year, which would be less than 1 percent, she said. The department did not provide a breakdown for the state share and the employees’ share of the slightly higher $332.4 million for the 2019 calendar year.
During the 2017 legislative session, majority Republicans in the House and Senate revamped the collective bargaining law to remove health insurance and other benefits as subjects for negotiations — except for the State Police Officers Council, whose roughly 600 members still bargain over benefits. Former Gov. Terry Branstad signed House File 291 into law before he resigned as governor to become ambassador to China.
An analysis by the state Department of Management determined the state experienced a $44.86 million net gain in 2018 from its reworked public employee health insurance plan that is costing an extra $13.2 million for thousands of state workers — many who no longer are allowed to bargain collectively for benefits.
During Monday’s brief discussion of the new contract with Blue Cross-Blue Shield, Phipps said the plan called for keeping the Iowa Choice and National Choice options for participants with slightly higher premiums, but “nothing changed” for co-payments, coinsurance or value-programs.
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She said the state sought three bidders, but two withdrew, leaving only the offer made by Blue Cross-Blue Shield for a two-year contract, with options for four one-year extensions.
In 2016, state employees paid $20 a month for a single or a family health insurance plan. After collective bargaining changes Republicans made in 2017, that monthly fee was doubled to $40 for individual in-state health insurance plans and $150 a month for a family plan under the current contract. A more expensive national option was available, too.
Gov. Kim Reynolds, who approved the new plan along with State Treasurer Mike Fitzgerald, State Auditor Mary Mosiman, Iowa Agriculture Secretary Mike Naig and Iowa Secretary of State Paul Pate, said the modest increase to provide health, dental and life insurance options for state employees was “good news.”
“Hopefully,” she added, “we’re starting to see some of the results” of strategies put in place to help employees exercise healthy options that also assist in managing costs.