Pay to Play Trumps SHBP

promoted by Rosi

As aggravating as The Star Ledger’s editorial page has been lately (in regards to its general animus towards the NJEA and public sector unions in general) , I was happy to see today’s editorial, N.J. municipalities waste millions when buying insurance.

The reason I was glad to see the editorial is two fold. One, I concur with the editorial.  The health insurance industry is extremely complex, most cannot grasp it (which is one reason mayors get away with flim flam pay to play broker business).  The reality is that there are power in numbers especially when it comes to a self insured plan, like the SHBP.   Towns that go out and purchase private, fully insured health benefits for small to medium groups cannot realistically compete with a self insured health and prescription plan that has hundreds of thousands of members in it.  Unless these small groups are purchasing benefits with drastically less value (which is not the case) than the SHBP, the argument that they are being prudent is ridiculous.

More below the fold …

Secondly, it is my opinion that Christie would prefer for this story to die.  To my knowledge, he has made no public remarks on the report that spurred this story.  Insurance brokers get paid from the insurance provider, thus when a public entity uses a broker to purchase health benefits, no money is exchanged from the public entity to the broker.  It is a line item that is never seen, and is part of the whole scheme.  If standard commissions are 5% of premium, brokers are basically getting paid 5% of millions of dollars in premiums, year after year.  If you combine the commission payments with the increased costs of writing insurance plans for small groups, one can see how the State Comptroller says a 100 million dollars can be saved.  If Norcross was to lose his public sector business, it would be a tremendous loss to his business.  I don’t think there is a favor big enough that Christie or Sweeney could grant to replace it, which is why I predict this story goes nowhere.  Insurance is how Norcross has made his living, insurance is how he became powerful and has become entwined in the public sector.  Christie needs Norcross, the Christiecrats are Norcross.  This story is going to die on the vine.  More proof that Christie is a corrupt hypocrite.

Comment (1)

  1. 12mileseastofTrenton

    It needs a second party.  The party of corruption and the party of privatization are one.

    Reply

Leave a Comment

Your email address will not be published. Required fields are marked *