The New Mexico Legislative Finance Committee Third Quarter Report Card gave a low rating to the State Health Benefit Program.
The New Mexico LFC Report States, “The program is not currently pursuing strategies to preserve benefit quality, and control costs outside of increasing premiums and requiring greater cost sharing plans with employees.”
State employee health benefits have risen fifteen percent along with a three-hundred fifty dollar annual deductible.
The Report Further States, "The Risk Management Advisory Board and The Group Benefits Committee have not met in over a year and could be helpful in identifying cost drivers and refining loss prevention of Risk Management Program Procedures."
New Mexico has a self-insured plan for state employees, that is managed by the Risk Management Program.
State Representative Luciano “Lucky” Verela, Chairman of the Legislative Finance Committee says that a greater increase in pay and transfer of funds from other surpluses will help keep the health benefits fund solvent.
“I’m suggesting more than the one percent salary increase that the legislature provided for. There are other surplus dollars in salaries and benefits," said Rep.Verela.
Rising health care costs along with the incoming Affordable Care Act has some employers concerned about how to minimize costs.
Andre Moquin, Benefit Director of Human Resources the city of Las Cruces said the state self-insured plan is currently the best option for the city. However, his department has started to research data on alternative options for health benefits.
“Our second phase now is going to be to take a test of market and review of market to see if initial analysis will result in the potential for lower premiums for employees and that is underway as we speak,” said Moquin.
Moquin says that there are some things that he would like to see change with the state plan, like offer more incentives for preventative care.
“One of the things we would to see through the state program, if we do remain with them is the opportunity to look at wellness initiatives; and that the employees that are actively taking part in maintaining a healthy lifestyle will have a positive impact on their premiums to encourage that. Preventative care and preventative lifestyles are integral in keeping health care costs down,” said Moquin.
Moquin says, another concern is that increases to premiums may become too large and the city could be penalized under the incoming Affordable Care Act that says employers must offer affordable health care plans.