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That would be a slightly lower rate of inflation than the state
has seen in recent years. Costs
CMS Director Raven DeVaughn said the increases have been due to
several factors, including growth in the state’s workforce.
Since 2019, she said, the state has added about 10,000
employees. She said the health plan now covers about 470,000
lives, including employees, retirees and qualifying dependents.
But DeVaughn also cited general inflation in the health care
industry as a contributing factor.
“Certainly, there’s the general idea of inflation that we are
all just fighting through as a country,” she said. “We can’t
quite point to one specific thing that has increased our
liabilities.”
According to CMS data, the average cost per participant is
expected to grow 8.3% next year, to $12,051. That would
represent a 45.7% increase over fiscal year 2018.
As an employer, the state offers its employees a variety of
different health benefit plans. They are funded through a
combination of state funds, employee premiums, prescription drug
rebates and other miscellaneous revenues.
The state’s general revenue fund is the largest single source of
funding, accounting for about 62% of the system’s total
revenues. That cost is expected to rise 12.8%, to $2.8 billion
in the upcoming fiscal year. Contributions from the road fund
are expected to decline 10%, to $155.5 million, while funding
from university funds is expected to remain even at $45 million.
Member contributions are expected to increase $30 million, or
4.9%, to $637 million. Member contributions make up about 14% of
the system’s total revenues.
Premiums, which are largely a function of collective bargaining
agreements, are expected to rise $8 per month for employees and
$4 per month for all dependents in both fiscal year 2026 and
2027, the last year of the current labor contract.
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