Florida House Health and Human Services Committee Reviews State Employee Health Insurance Program; Federal Legislation Impact
Jan 27, 2011
The Florida House of Representatives Health and Human Services Committee (“Committee”) met today, January 27, 2011 to review the State of Florida’s employee health insurance program (“program”). To view the meeting packet, click here.
Michelle Robleto, State Group Insurance Director, provided Committee members with a program overview, including information about its offerings, plan types, enrollment trends, funding and budgeting.
The State of Florida currently provides health insurance to approximately 300,000 employees, their dependents and retirees through seven different plans. Employees may choose from a PPO plan administered by Blue Cross and Blue Shield, five HMO plans and a high deductible health savings account plan.
Approximately 90 percent of the cost for these plans is contributed by the State. As a result, for fiscal year 2010-2011, Florida has budgeted $1.45 billion to fund employee health plans, which is about 14 percent of the payroll cost of the enrolled employees.
Currently, 18,000 eligible state employees opt to not enroll in a state-sponsored health care plan for a variety of reasons.
Meanwhile, according to Ms. Robleto, enrollment in the state’s PPO plan is declining, while enrollment in the HMOs is increasing to the point where there are now more HMO participants than those in the PPO plan. Deficits have been forecast for the program in 2012-2013, as well as for 2013-2014, but, while that forecast does not anticipate contribution increases, it does include increased costs due to federal health care reform.
State Representative Mia Jones asked Ms. Robletto why costs were inflating at such a high rate. Ms. Robletto responded that the inflation was due to increased cost of care, not increased plan participation.
In response to a question from Committee Chairman Rob Schenck, Ms. Robleto explained that Florida’s 90 percent employer contribution rate was high in comparison with that of private enterprise.
Tony Holmes, an actuary with Mercer, an employee benefits consulting company, discussed the federal health insurance law impact on government health insurance plans. Based on changes that will take place in 2011, Florida is expected to lose its “grandfathered status” on existing HMO/PPO health plans. By 2014, individual coverage mandates, Medicaid expansion, health insurance exchanges and other critical components of the new legislation will be in effect.
Also, in 2018, an excise tax will be applied to all “Cadillac” health plans. Once the reforms are fully implemented, Mr. Holmes explained, it is possible that Florida could see an increase of up to 40 percent in the cost of providing employee health care.
“This is just the first conversation that lawmakers will have on the federal healthcare law as it will affect Florida dramatically on numerous levels,” concluded Chairman Schenck. “The federal healthcare law is going to have a huge impact on health care in Florida and it is important that our committee is fully briefed on the implications of the federal Patient Protection and Affordable Care Act so that we can make wise policy decisions going forward with respect to the State Employee Health Insurance Program.”
The Committee meeting concluded during Mr. Holmes’ presentation.
Should you have any questions or comments, please contact Colodny Fass.