Insurance coverage for the state’s retirees and current employees may soon become more costly
Louisiana’s employee health insurance program may be out of money by the end of the state’s budget year, according to Commissioner of Administration Kristy Nichols. Governor Bobby Jindal has proposed significant changes to the program in order to avoid its financial collapse, but these changes have been heavily criticized by many of the state’s lawmakers. If no action is taken on the matter, insurance coverage for the state’s employees could become significantly more expensive.
Rates for employees could grow by as much as 37% beginning in 2015
According to Nichols, if numerous new insurance plans are not put into effect by January 1, 2015, retirees and state employee’s could see their premiums spike by as much as 37%. The premium increase would be necessary to keep the health insurance program solvent. Nichols also notes that state agencies and local school districts would have to pay more money in order to cover their share of insurance costs. This could place agencies and schools under significant financial pressure.
Retirees are noting that they are having trouble covering the cost of insurance coverage
Some retirees are reporting that they are having financial trouble due to increasing out-of-pocket insurance costs. Some claim that they are having to make the choice between paying their electricity bills and paying for the medication they need. These retirees are relying on the state’s health insurance program, but the programs growing financial problems are beginning to wear on its policyholders.
State’s program may be in financial trouble if changes are not made
Insurance premiums for policies sold through the state’s program have actually fallen in recent years. According to Nichols, this was because the state could not afford to increase salaries for its workers and opted to provide them with insurance rate cuts instead. Insurance coverage is expected to become more expensive next year, however, as the cost of medical care continues to grow. In order for the state’s insurance program to cover these costs, it will have to raise rates by a significant degree, unless changes are successfully made to the program itself.