Employer-sponsored health insurance for government workers evolving

Group Health Insurance

Employer-sponsored health insurance gap shortening between public and private sectors

A new analysis from USA Today has found that many state and local governments throughout the country are saving significant amounts of money on employer-sponsored health insurance by cutting the benefits that are provided to workers. According to federal data, government workers typically have access to more generous health insurance benefits than those in the private sector. Several economic factors, such as a major recession, have encouraged sGroup Health Insurancetates to make changes to the coverage they offer employees, in an attempt to save money.

Analysis shows that government workers are paying more for coverage

According to USA Today, the advantage that government employees received in terms of health insurance has dropped from $1,523 in 2007 to just $891 in 2012.  Employees are also being tapped to contribute more to the coverage they are receiving from the state. The analysis notes that approximately 39% of workers in 2007 paid nothing for their health insurance coverage. In 2012, that has dropped to 30%. In the private sector, only 17% of workers pay nothing for their employer-sponsored health insurance.

Public sector still receives better benefits than private sector

Despite cut backs, state and local governments are still providing workers with more generous benefits than can be found in the private sector. Many of these benefits come in the form of more choices for coverage, lower deductibles, and reduced co-payments. Though public employees typically receive better benefits, they are now paying roughly the same amount as those in the private sector. According to the Labor Department’s recent National Compensation Survey, both the private and public sectors see paycheck withdrawals for health insurance come in around $425 each month for family plans.

Some workers seek legal action to resolve coverage problems

Government employees are not necessarily pleased with the changes they are seeing. Many have begun taking the matter to court, hoping to have the costs of their coverage returned to what it had been in previous years. The issue is even up for public vote in upcoming elections, but whether these efforts will be successful has yet to be seen. Many Republican Governors have vowed to reduce the costs states face from employer-sponsored health insurance.

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