New Mexico workers may be seeing their health insurance premiums spike next year if a new proposal from Governor Susana Martinez wins favor with lawmakers. The proposal aims to increase the rates for worker’s health insurance plans by 15% in an effort to avoid the complete bankruptcy of the state’s health insurance fund. The fund is currently scheduled to run out of money in the next budget year, but higher premiums are expected to remedy the issue handily.
State employees will see an average increase of 15%
The proposal will raise the health insurance premiums of state workers and their dependants by an average of 15%. This will translate into an increase of at least $315 to as much as $914 in yearly premiums. State workers will be able to select from a variety of health insurance plans that suit their needs and budget. The General Services Department will seek $10 million next year in order to help mitigate the financial impact of the higher health insurance rates.
Measure meant to protect state’s insurance fund
If the proposal succeeds in garnering enough support, state employees can expect to see their health insurance rates jump beginning July 1, 2013. Tim Korte, a representative of the General Services Department, notes that the matter is strictly one of budgetary necessity and does not represent any problems that the state is having with insurance companies or health care providers. Korte claims that the 15% increase in premiums is considered by state officials as the most viable way to save the state’s health insurance fund without presenting excessive financial stress to public workers.
Approximately 73,124 employees and their dependants are covered by New Mexico’s health insurance program. If the insurance fund runs out of money, the program will not be able to pay the claims coming from these policyholders. Instead of allowing the insurance fund to run dry, state officials have suggested increasing health insurance premiums. At this time, a raise in premiums is expected to resolve the issue and ensure that policyholders will still be served by the state’s program.
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