Taxpayer Costs for State Employees’ Health Insurance Rises

The Iowa Executive Council met on October 3 with a number of items on the agenda. One such piece was a vote to renew the state’s group insurance contract with Wellmark Blue Cross/Blue Shield. The renewal was accompanied by premium increases for two of the four covered areas. Health premiums are going to increase by 0.8% and dental rates will increase at a rate of 4.4%. The rates for term life insurance and long term disability will remain constant.

“…87% of state employees pay nothing toward their health insurance premiums”

These rate increases translate into an additional $12 million in spending the state has to pay in order to cover its employees. For purposes of health insurance, the state pays 100% of single and double spouse contracts and 85% of an employee’s family premium. According to the nonpartisan Legislative Services Agency, 87% of state employees pay nothing toward their health insurance premiums.

House Republicans attempted multiple times last session to restore some equity to the taxpayer by requiring state employees to contribute as little as $100 a month toward their health insurance. Each time the issue was raised, it was met with strong resistance by Democrats. In an analysis conducted for HF 525, the collective bargaining reform bill that House Republicans offered and passed, LSA estimated that by requiring a $100 contribution to the premium, the state would save $33.3 million per year.

However, due to Governor Culver’s acceptance of the initial union collective bargaining agreement offer, the state is locked in to paying these rates for the next two years. At that point, a new agreement will have to be reached and Governor Branstad has made it clear that he will not accept the first offer the union presents without making a counter-offer. Governor Branstad has said he intends to take a hard look at the cost of insurance and that it will be on the table for discussions.

  • Joe Smith

    State workers are already paid less and better qualified than private sector workers, why is the legislature preoccupied with sticking it to the state worker rather than reviewing which programs should be eliminated but are kept around simply because they generate revenue

  • L Devoe

    Agree with Joe, the workers have a great health insurance, HOWEVER it is in compensation for lower wages that have been bargained for. So you just want to cut the wages of your state workers, who by the way work very hard.