In the December 2012 Edition of the New Mexico Legislative Finance Committee Newsletter it stated, “The State Employee Benefit Fund is scheduled to run out of money in 2014 unless premiums are raised and benefits are cut.”
The state fund covers nearly 75,000 people if you include employees and dependents.
In that same newsletter it also said that A.J. Forte was appointed division manager of the health benefits fund. Forte is the third director of Risk Management under the current administration.
According to Forte, something had to be done after five years of no raises in premiums and no new plan designs. His department decided that in order to keep the state fund solvent they needed to raise premiums fifteen percent and charge an annual deductible of $350 dollars. He said the changes to the state plan were communicated to the employees through a couple of ways.
“We educated all state employees either through in-person open enrollment meetings or they can always refer online to the risk management website to get the details of the plan, and the plan redesign,” said Forte.
Connie Derr, Interim Executive Director of the New Mexico Chapter of the American, State, and Municipal Employee Union says her organization was not involved in any discussion regarding the rate change.
“I mean there was no discussion with the unions about it, everything has just been imposed. Even though there is collective bargaining and they have an obligation to bargain with the unions the administration is just one-sided,” said Derr.
A.J. Forte said there are only two options when trying to bring revenue to the plan and that is through increase of premiums and plan redesign.
The increase just took effect yesterday, so more time may need to pass for some employees to realize just how much they are paying for health benefits.