North Dakota lawmakers consider bill that could lead to state employees paying for health premiums
A committee of lawmakers on Tuesday endorsed a bill that would allow the state to shift health insurance premium costs onto employees.
Senate Bill 2160, sponsored by Rep. Kyle Davison, R-Fargo, would change the state employee health care plan to comply with the federal Affordable Care Act. This change would be irreversible.
The House Appropriations Committee voted 15-7 to give the bill a do-pass recommendation.
It will soon go to the House floor for a vote by the whole chamber.
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Supporters cite two main benefits to the policy. For one, it would cover a greater swath of services for employees — including contraception and preventative procedures like colonoscopies and mammograms.
Under the new plan, co-pays would also apply toward out-of-pocket maximums.
The new plan would cost about $6.6 million to implement for the 2025-2027 budget, according to an analysis attached with the bill. It says it would cost more than $25 million for the 2027-2029 biennium.
One of the more divisive components of the proposal is that it'd give the state the ability to make employees pay a portion of the insurance premiums. Right now, the state covers that cost.
Some said this would allow the state greater flexibility to address rising expenses for medical care.
'We have to start looking at ways to make a change for our budget, because we are not going to have the revenue coming in next time that we've had in the past,' said Rep. David Monson, R-Osnabock. 'To ask people to kick in a little more out of their pocket, put some more skin in the game, I don't think that's unreasonable.'
Critics have said there isn't enough concrete evidence to suggest the policy change is a good idea.
Molly Herrington, chief people officer of the state's Office of Management and Budget, submitted testimony last month in opposition to the bill.
She said the state doesn't have data on how many employees would prefer to change to an Affordable Care Act compliant plan.
'Funding increases for the upcoming biennium are planned to be covered through PERS reserves, but we are concerned with how future costs will be covered long term and the risk that costs would be paid by employees,' Herrington wrote, referring to the North Dakota Public Employees Retirement System. 'If increased costs are pushed to employees, this would significantly dilute the strength of our total rewards package.'
Her testimony included survey results from 2022 and 2024 that indicate employees consider health insurance the most important benefit offered by the state.
'I think we're treading down a very treacherous path that we may not fully appreciate with regards to retention and employees,' said Rep. Eric Murphy, R-Grand Forks, who voted against the bill.
North Dakota United, the union that represents public employees, said he opposes the bill. President Nick Archuleta said the state Legislature should study the issue during the upcoming interim session to field more thorough feedback from state employees about what kind of health insurance they want.
'They should not fear taking the time that it takes to get the information needed to make a good decision,' he said.
Some have testified that they believe the new policy could be a draw for state employees, however.
'We see this bill as, frankly, a retention tool for some of our employees, for the different benefits that are covered that are not covered right now,' Insurance Commissioner Jon Godfread told lawmakers at a previous committee hearing.
In written testimony, Insurance Department Deputy Commissioner John Arnold elaborated that the agency still worries about the long-term impacts of changing the plan.
'A shift in costs could create an additional financial burden on state employees, ultimately affecting the workforce's morale, retention, and the state's ability to attract top talent,' he wrote.
Arnold said the department would support adding an Affordable Care Act plan as an option for employees if it also allowed them to remain on the existing plan.
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