DOVER — The delayed vote involving proposed state employee health care cost hikes is holding certain parts of state government “hostage,” officials say.
Office of Management and Budget Director Ann Visalli, chairwoman of the State Employee Benefits Committee, made the remark Monday when the group gathered to discuss the remaining steps and issues surrounding the plan.
Gov. Jack Markell proposed higher copays, prescription drug costs and deductibles in February to help close a $116.3 million shortfall, but pressure from citizens and lawmakers led to the vote being pushed back from March 20.
Providing $26.1 million in General Fund money, which the committee did on March 20, cut the deficit to $60.1 million. Until that is eliminated, however, the delay is causing problems.
“The longer this process takes, the more we’re spending,” Secretary of Finance Thomas Cook said.
Ms. Visalli agreed, noting the delay has dragged the health care situation into the general budget-crafting. Normally, the two are kept separate, with the Joint Finance Committee of 12 legislators developing the overall budget.
Now, however, the two processes are “married,” according to Ms. Visalli.
At the meeting, she provided an overview of the current options. The state could supply more General Fund money to reduce or altogether cut the gap. Thanks to Special Fund dollars and money from other sources, it’s not a 1:1 match, meaning the state gets more bang for its buck that just what it uses from the General Fund. Allocating $28 million would completely clear the gap.
At the same time, that reduces the money available for the fiscal year 2016 budget.
Various other suggestions would save several million here and there, such as cutting coverage for erectile dysfunction drugs (picking up $2.7 million), increasing 30-day drug supplies by a few dollars and raising copays. Bumping up deductibles — including adding them for some plans that do not currently have them — would also provide funds, in some cases substantial amounts.
Entities designated as participating groups, such as municipalities, fire companies and universities, have seen their costs go up as a result of the delay. A hike from 5 to 15 percent to help cover their share means higher expenses for those groups.
Ms. Visalli said Monday while she has been open to negotiations and will listen to suggestions, she is unwilling to be “irresponsible” for much longer. Pushing the vote beyond a certain point will have consequences.
The problem must be resolved by May 18, when the JFC will begin finalizing the state budget. If not done by then, lawmakers will not know how much money they have to work with, creating a conundrum.
The committee is set to meet again on April 27.