Sweeney/Beck Bill Undermines Collective Bargaining and Enriches Health Insurance Brokers (Norcross)

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The Sweeney/Beck bill (S2718) to switch costs to New Jersey public workers is exactly what Hetty Rosenstein calls it –  a back door to making collective bargaining illegal.

The Sweeney bill would also have the impact of …

(more below)

The Sweeney bill would also have the impact of lowering total compensation for New Jersey public workers, especially for the professionals who dominate state government employment, significantly below their private sector counterparts.

Governor Christie couldn’t be more pleased with the Sweeney/Beck bill.  But there is another group that will be, if anything, more pleased with the bill – health insurance brokers who sell their services to New Jersey local governments and school districts.

Brokers Lose Business while Local Governments Save –

It’s a tough time for health insurance brokers as many local governments and school districts are joining the two state sponsored health plans — the State Health Benefit Plan (SHBP) and the School Employees Health Benefit Plan (SEHBP) to take advantage of the low rates (for New Jersey) that the state plans offer.  This is a big problem for the brokers since the state plans see no need for health insurance brokers and prohibit health brokers from charging their fees of 2-5% of premiums to any public employer who’s part of the state plans.

   Even worse for the brokers, the trend towards local governments joining the state plans is accelerating.  Since June 2010, 26 local governments with 5131 employees have switched to the State Health Benefit Plan  while only 3 public employers have left.   Since 2008, 100 to 120 school districts have joined the School Employees plan.

   By joining the state plans, local governments and school districts achieved significant savings which also greatly helped resolve many collective bargaining agreements, but health insurance brokers lost fees.

What’s a broker to do? — Get the legislature to End the Low Cost Health Care Alternative

The Sweeney/Beck bill prohibits any additional local governments or school districts from joining the state plans.   If that means that local governments don’t get the best rates and are forced to pay broker fees — oh well!

Who are the Brokers?

Connor Strong describes itself as the biggest broker in New Jersey and its focus is on public employers.   It claims to provide services to 110 New Jersey local governments.

The principle officers of Connor Strong are South Jersey Democratic leader George Norcross and, from the shore, Ocean County Republican leader Joseph Buckelew.  Is it a mere coincidence that the bill’s sponsors reflect the same geographic split?

The Sweeney/Beck bill moves away from shared services and using the massive bargaining clout of the state plans to achieve savings and encourages individual purchase

of health coverage by each municipality.

Even More Costs for Local Governments

The Sweeney/Beck bill seeks to address health quality and cost issues but instead of doing this regionally or state wide on an efficient, shared service basis, the bills mandates that each and every local government and school district set up a Employee Benefits Quality, Cost and Delivery Committee.  Naturally, it should be expected that these committees will require advisors adding even more costs for property taxpayers but providing nice fees for health brokers and advisors like Connor Strong.

Dudley Burdge is a CWA local employee and member of the New Jersey State Health Benefit Commission representing local government employees.  His opinions expressed above don’t necessarily reflect the position of the State Health Benefit Commission.

Comments (19)

  1. firstamend07

    I get it now! All the problems with the health plan being underfunded is really just a smokescreen for a pay day for some politically connected politicians!

    How could so many people have been so dumb!  

    So this is the CWA argument against S2718? unbelievable!  

    Just when my optimism in that organization was starting to rise the CWA mouthpieces come up with this crock.

    Nothing like a good old conspiracy theory!  


  2. cwadudley (Post author)

    Your hatred of CWA makes you completely incapable of basic analysis.   You make up an arguement and claim that it is mine when nothing could be further from the truth.  By the way, the health care funds are not underfunded.   Rates are calculated on a yearly basis

  3. firstamend07

    The pension fund is broke.

    The health plan is broke.

    You spend your time arguing over sidebar issues.

    Every state worker with an ounce of common sense knows that the taxpayers, the Democrats, the Republicans ,and the Governor are demanding that we pay more.


    State workers have 3 choices for health care reform.

    Pay Christie’s draconian demands which would absolutely kill many employees.

    Go with S2718 and the Sweeney/Beck gradual 7 year payment plan,which is VERY  fair.

    Or roll the dice and hope that the CWA negotiating team can get a better deal than the Sweeney plan from Christie.

    There are no other choices.

    I think the best deal is the one on the table, the Sweeney plan.

    What do you think?


  4. William Weber (WjcW)

    Are public entities ALLOWED to switch out of the State plans?

    The gov. has put the cost of the state plan at $24k. Is he full of it?

    That is defintely not cheaper than private insurance.

    I was under the impression that the state plan was some of the best insuranace available. It makes perfect sense that towns were collectively bargained into offering that plan. It also stands to reason that once you get the best insurance available, you wouldn’t want to give that up.

    I’d guess the 3 towns that were able to switch out of it, were only able to do that in exchange for some other concession from the unions.

    I don’t think your being quite honest when you suggest that towns have free will over which insurance to offer, isn’t that all bargained for?

  5. firstamend07

    “The health fund is not broke”

    You actually beleive that?

    Well you win! I am done arguing this. I can’t have an honest arguement with someone who  thinks the fund does not need reform.

    Keep drinking the CWA Kool-Aide and enjoy yourself in la-la land!

  6. William Weber (WjcW)

    “Health Fund”

    it’s pay as you go, isn’t it?

    Every year revenue is generated and spent to pay the premiums.

    Isn’t that correct?

    As such, the ‘fund’ cannot be broke.

    But, the liability can rise to a level where it consumes a disproportionate amount of the budget and/or requires tax increases.

    But that’s what the debate is all about, isn’t it? Where exactly is that level…

  7. 12mileseastofTrenton

    “Christie and Sweeney:  Perfect Together.”  It’s what I’ve been saying for quite a while now.

  8. Bertin Lefkovic

    Make NJFamilyCare the standard for all public employees, including but not limited to elected officials and their staffs.

    Sell NJFamilyCare to anyone who wants to purchase it at a premium over its base cost with the proceeds paying for it to be given to everyone earning 200% of the poverty line or less so that NJ can qualify for federal matching funds under the Obama healthcare plan.

    Requiring elected officials, public employees, and the rest of us to have a stake in the NJFamilyCare program should ensure that it provides sufficient coverage at the right price.  Let the private insurance companies compete with that.

  9. Nick Lento

    Unless the diarist is making up facts, this is an open and shut case of a monied interest group having it’s way with the state of New Jersey.

    When insurance is purchased as part of a large group you get wholesale prices.  No need for “brokers”.

    Better yet, expand the pool to EVERYONE, then there is no need for insurance companies at ALL.

    The ideal is irrefutably logical and simple and right.

    We are being shafted.

    As for fa7, he says good things “Dr Jekyl” generally….right up until any issue comes up that is important to Sweeney/Norcross machine….then “Mr Hyde” shows up.    It’s so overwhelmingly obvious the guy/gal is owned.  He’s been “consistent” for years.


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