Mur­phy sets up lis­ten­ing tour for health ben­e­fits panel

The Trentonian (Trenton, NJ) - - FRONT PAGE - By Mike Catal­ini

TREN­TON » New Jersey Gov. Phil Mur­phy is tak­ing his ad­min­is­tra­tion’s health ben­e­fits re­view on the road.

The fresh­man Demo­crat an­nounced this week that the task force he put to­gether this sum­mer to re­view New Jersey’s multi­bil­lion-dol­lar pub­lic worker health ben­e­fits will go on a three-stop lis­ten­ing tour.

The task force’s meet­ings, one each in the cen­tral, north­ern and south­ern parts of the state, will take place through Novem­ber and come soon af­ter a bi­par­ti­san leg­isla­tive com­mis­sion un­veiled its own find­ings about how to ad­dress this peren­nial is­sue.

Mur­phy has not tipped his hand about what changes he would ac­cept, but has al­lied him­self closely with the state’s pub­lic-sec­tor unions, which gen­er­ally op­pose ben­e­fits cuts and waged a war of words over give­backs un­der Repub­li­can Chris Christie.

That sets up some po­ten­tial ten­sion with the Demo­crat-led Leg­is­la­ture be­cause the leg­isla­tive blue rib­bon panel rec­om­mended a cut in ben­e­fits for the state’s roughly 800,000 work­ers and re­tirees.

A closer look at the is­sues:

WHAT’S THE PROB­LEM?

In a word: money. The state has a com­bined pen­sion and health benefit li­a­bil­ity of about $152 bil­lion, ac­cord­ing to the leg­isla­tive panel that re­leased its find­ings weeks ago. That’s roughly four times the size of the state bud­get and three times the size of the state’s bonded debt. Health ben­e­fits this fis­cal year run $3.4 bil­lion, or just less than 10 per­cent of the over­all bud­get, and are ex­pected to climb by $700 mil­lion over the next four years.

The Leg­is­la­ture’s re­port es­ti­mates that the ris­ing costs are about $200 mil­lion more than state rev­enues are pro­jected to grow over the same time pe­riod.

WHAT PRO­POS­ALS ARE ON THE TA­BLE AL­READY?

Mur­phy has been mostly ret­i­cent about how he would pro­ceed. He an­nounced the task force, which in­cludes mem­bers of la­bor and his ad­min­is­tra­tion, in May and said in a later ex­ec­u­tive or­der that he wanted it to look for “short-term im­prove­ments” and “long-term re­forms.”

Law­mak­ers al­ready put some­thing on the ta­ble, though they have not yet ad­vanced any leg­is­la­tion.

The leg­isla­tive work group rec­om­mended re­duc­ing pub­lic worker ben­e­fits from plat­inum level to gold level. That change alone would save $587 mil­lion from state re­tiree ben­e­fits pre­mi­ums in one fis­cal year alone, ac­cord­ing to the com­mis­sion. An­other big change would be re­quir­ing re­tirees to shoul­der the same per­cent­age of the cost of ben­e­fits as cur­rent work­ers, at 21 per­cent. New re­tirees in 2016 paid just $50 mil­lion out of $2 bil­lion for health care, ac­cord­ing to the leg­isla­tive panel.

WHAT’S THE KEY CON­TEXT?

Un­der Christie, pub­lic sec­tor unions op­posed cuts, and Mur­phy cam­paigned and won last year with their as­sis­tance. He’s made no pub­lic prom­ises on health ben­e­fits, but he has taken some ac­tions to show how close he is with la­bor: He de­clined to re­new a 2 per­cent cap on the amount that could be awarded in ar­bi­tra­tion cases be­tween po­lice and fire work­ers and towns. That was a win for la­bor unions. He also agreed to pub­lic worker con­tracts that re­sulted in across-the­board raises to the ac­claim to unions. But Mur­phy also headed a 2005 health ben­e­fits re­view com­mis­sion for then Act­ing Gov. Richard Codey. That re­port called for work­ers to shoul­der a larger share of ben­e­fits costs.

WHAT’S NEXT?

The first task force lis­ten­ing ses­sion is Thurs­day evening in Hamil­ton. The sec­ond is Oct. 25 in Rutherford, and the fi­nal meet­ing is Nov. 14 in Mount Lau­rel. Res­i­dents can sub­mit com­ments to the task force at StateHealthBen­e­fit­sTaskForce@NJ.Gov.

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