Legislative Changes to Health Benefits

Many of you have been following in the news the changes that the New Jersey Legislature has made in the State Health Benefits Plan and Pension Programs.  In an effort to keep you informed of the direct impact of these changes on you, the Division of Human Resources will issue a series of communications as details of these changes become clear.  In this first communication, we highlight the more immediate impact of the changes on the cost of your health benefits:
  • New deduction amounts are slated to take effect on the paycheck issued October 14, 2011.
  •  Percentages for employees hired prior to June 28, 2011 have a phase-in of four years and these employees will contribute Year 1 percentage rate on the paycheck issued October 14, 2011.   
  • Employees with a hire date on or after June 28, 2011 will contribute the Year 4 percentage rate as of the paycheck issued October 14, 2011.

To calculate your own cost, please follow the steps set forth below:


Use the link on our website, Health Benefits Salary Bands, for the listing of salary bands provided in the recent legislation.

 

Locate your salary band to check the percentage of premium you will be responsible to contribute.  The cost of medical and the cost of prescription are listed separately so they must be added prior to the calculation.  The current premium chart is posted on our website at: Biweekly Premium Rates

Once you have located the level of coverage (individual, family, etc) and the salary band within that level, the associated percentage of premium can be calculated in this manner:

 
For employees hired prior to June 28, 2011 only:

  •  There is a phase-in period of four years, so you will only be paying 1/4 of that percentage in the first year.  
  • For example, if you find your salary band and see you are responsible for 12% of the premium by the fourth year, then 1/4 of that means you will be responsible for a payment of 3% of the premium effective with the paycheck issued 10-14-2011.
  • In that example, if you were to multiply .03 times a sample premium amount of $300 you would see a responsibility of $9 per pay with the paycheck issued 10-14-2011.
  • Since the payment would be below 1.5% of salary you would remain responsible for the same amount you are currently paying during the first year.
A committee at the State level will be working to redesign the medical and prescription plans offered in order to provide different options for co-pays and other employee costs, including a high-deductible plan.We will provide specific information on plan offerings and new premium amounts for 2012 as soon as the State has developed them and provided the information to us.  This will be no later than prior to the open enrollment period in the month October at which time you will be able to change your coverage if you wish to do so.

So you have a sense of the magnitude of the legislative changes in the cost of benefits effective in October, 2011, we developed the following paycheck illustration.  We chose an employee with base annual earnings of $75,000 with the most often selected plan and coverage: a NJ Direct 15 plan with the contribution towards member/spouse/partner coverage:


 


Before the 
  change to

contribution

After the
 change to

           contribution


Gross Pay/pay period

$2873.56

    $2873.56

NJ Direct 15

43.10

44.40














In our efforts to keep you informed about these matters of interest and concern, we will continue to provide online messages, printed materials, and offer scheduled walk-in opportunities held in University Hall to address specific questions.  It is also our intention to be available at different locations around campus in the fall with materials and opportunities for individuals to ask and get answers to their questions.