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Senate, NJEA Agree to Health Care Plan Expected to Save $1 Billion

Taxpayers and educators will both benefit from new health benefits plans announced by Senate President Steve Sweeney and Marie Blistan, the President of the New Jersey Education Association (NJEA). This landmark agreement calls for reduced contributions by NJEA members, and is expected to produce more than $1 billion in annual savings.

Supporters of the seven-year plan say it will address the issues of cost, quality and health wellness simultaneously. The annual savings are expected to be $670 million for local school districts and $403 million for NJEA members.

“The agreement is the result of several months of intense negotiations and represents a culmination of several years of efforts to identify opportunities to address the quality of healthcare while dealing with the reality of its skyrocketing costs,” said Sen. Sweeney.

Tough Negotiations

Sweeney referred to Blistan as a tough negotiator, but both characterized it as a win-win for both taxpayers and educators.

“It is no secret that our members have suffered a great deal under Ch. 78, which imposed unsustainable and ever-growing health care costs on them,” said Blistan. “With this creative, collaborative approach, that burden is greatly reduced, and our members no longer need to fear that their take-home pay will decrease year after year as a result of those imposed contributions.”

Sen. Anthony M. Bucco praised the work done to create the new plans.

“I’m glad that legislative leaders and the NJEA are finally working together to negotiate cost-saving reforms that are acceptable to both parties,” said Bucco. “The announcement is a reflection that everyone agrees the cost of healthcare is too high and more must be done to lower costs for both teachers and taxpayers.”

New Jersey Educators Health Plan

Driving the savings is the creation of the new New Jersey Educators Health Plan (NJEHP). It will replace most other plans currently being offered to teachers and provide comprehensive coverage for medical and pharmacy benefits with reasonable member copayments for physician care and 100% coverage for the use of in-network providers.

New members coming into service and those electing to switch to this new plan will see their payroll deductions tied to a new contribution schedule, based on a percentage of salary as opposed to a percentage of premiums, as compared with the the currently required percentage of premium.

Those electing to stay in the more traditional plans will be required to pay more for their healthcare based on a percentage of their premium.

Garden State Health Plan

Another part of the agreement is the creation of the Garden State Health Plan in 2021. This plan will offer NJEA members the voluntary option of a plan that produces even more savings with a network of New Jersey-only healthcare providers. It will provide provisions for out-of-state care not available in the state.

“The level of benefits will match that of the NJEHP and will be tied to New Jersey providers who deliver care at quality standards at or superior to what is available outside the area,” said Sen. Sweeney.  

Estimates suggest care delivered outside of New Jersey is 50% to 100% more than the same services offered by New Jersey providers for the same or better quality.

The agreement requires the School Employees’ Health Benefits Program (SEHBP) to continue to promote and look to further expand the use and availability of patient centered medical homes inside the SEHBP.

Additional Legislation

Sweeney agreed to support two Educational Support Professional bills and help move them through the Legislature: S1928 on subcontracting and S993 on due process.

Bucco, the sponsor of the Subcontracting bill, said these announcements are all positive steps for teachers, school workers and taxpayers.

“My legislation will prevent the jobs of our cafeteria and janitorial workers and others who are important members of our school communities from being outsourced to vendors during the term of a contract,” said Bucco.

The bill prohibits an employer from entering into a subcontracting agreement which may affect the employment of any employees in a collective bargaining unit under any circumstances during the term of an existing collective bargaining agreement covering the employees.

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