The South Carolina Budget and Control Board has voted to increase the premiums of the state-run health insurance program that offers coverage to public employees. The board voted Tuesday to raise the rates of the program by 4.5% total which will be put into effect at the beginning of next year. More than 400,000 state employees are covered by the program as well as 100,000 retirees. The vote has drawn some criticism from state workers who argue that the increase is unjustifiable.
Employees of the state say that they had not seen an increase in the cost-of-living wage they earn for several years before the 1.5% increase of last year. By raising the rates on health insurance, what little profit workers were able to earn is now going toward paying premiums. This leaves little to no money left for savings or other bills. The new rates will have a more severe impact on retirees who live off of a fixed income that allows for very little flexibility in budgeting.
The Budget and Control Board argues that it has never raised rates unnecessarily. The board claims that the new rates are needed to ensure that the health insurance program remains financially sound in the coming years. The new rates may be spurred by the rising costs of medical care, something that many health insurers have railed against by raising their own rates.
The new rates will not take effect until the beginning of next year.