Premiums for most of the state’s health insurance options will go up more than 15 percent in January, according to a memo sent to employees early this month.

State employees will pay almost $50 a month more for family coverage, and about $14 a month more  for single coverage, under the state’s most expensive plan. About 13,500 workers use the state’s health insurance.

State taxpayers will spend an additional $14.4 million for employee health insurance next year under the current premium split: 79 percent is paid by the state, 21 percent by the employee.

The increase, which begins in January, is based on the costs for the claims this year, and the need to fatten up the reserve for the program.

“The state is self-insured, so rates are driven by use and the costs our employees incur in receiving services,” said Bill Wood, the state’s employee relations administrator.

Part of the increase is needed to rebuild the reserve, which had been depleted in recent years, said Roger Wilson, controller for the state. 

“We have to build up that reserve. We can’t live like this,” he said. 

Rebuilding the reserve will be a multi-year project, Wilson said.

The increase for next year seems in line with increases for similar programs in the Midwest, according to Mike Marvin, executive director of NAPE/AFSCME Local 61.

The cost of health insurance plans with no deductibles is rising faster than plans with deductibles, he said.

Four of the state’s health insurance plans are first dollar coverage, with no deductibles. Premiums for the four will rise by more than 15 percent. Premiums for one plan, with a deductible, will increase by 7.6 percent.

“This is pretty much in line with what our international (union) has seen,” Marvin  said.

The state will be looking at other options, including plans with deductibles, in order to hold down costs in the future, said Wilson.

The total annual family plan premium for the state’s most expensive and one of the most popular plans, Blue Choice, will be more than $21,400 next year.  

The University of Nebraska, another large public employer, doesn’t know what its health insurance rate increase will be for next year. Last year, NU had no premium increase.

Premium costs for 30,000 teachers and other school employees who use the Nebraska State Education Association plan went up an average 8 percent in September.

All NSEA plans have deductibles, which have seen lower growth in costs, said Craig R. Christiansen, executive director of the NSEA.

Reach Nancy Hicks at 473-7250 or nhicks@journalstar.com.