State Employee Health Benefits NCSL

State Employee Health Benefits

Updated: December 2013; material added December 2014
All 50 states provide health insurance coverage for their state employees.

Most have done so for decades. However, the amount of coverage, who is eligible to enroll, and the portions paid by the state employer and by the individual worker always have varied from state to state.
In the past five years these state benefit plans have attracted much more attention among legislators, governors and policymakers. Often, this is because:

  1. Rapidly rising commercial premiums are impacting state budgets;
  2. State fiscal pressures are leading to more proposals to increase employee share of costs;
  3. Co-payments and deductibles are on the rise in many places, separate from the established premiums.

A few general facts about state employee health plans, based on several national surveys: 1

  • State government employees covered by employer health insurance totaled 5,331,393. Local government employees similarly covered totaled 14,273,847, as reported by the AHRQ 2010 MEPS Survey III.B.1
  • An earlier commercial survey projected that states provided coverage for about 3.4 million state government employees and retirees.  When their covered dependents and family members were included, the total was about seven million people.
  • State and local employee health plans cover about 10 percent of the total U.S. workforce and hold more than 20 percent of the nation’s total pension assets. (CPR Report, 10/2014 & Center for Retirement Research at Boston College, 9/2009)
  • The average state and local employee tends to be older and more expensive to insure compared to private sector
  • In 2013, six states paid 100 percent of the premium for employee only coverage. (CPR Report, 10/2014)
  • Nearly all full-time state workers were eligible for coverage (97%), and take-up was high across most plans, averaging 91%.
  • 74% of part-time state employees had the option of electing health benefits (compared to 48% nationally.)
  • In state employee plans, 37% of workers were in HMOs, 42% in PPOs, 16% in POS plans and 5% were in conventional indemnity coverage. However, Indemnity plans enrolled a majority of retirees in the Midwest, Northeast and South. 2
  • State employer retiree or "post-employment benefits" (OPEB) liabilities and funding progress are featured in a November 2014 report from Standard & Poor’s that contains information about each state’s actions (see Table 2). This research suggests that 32 states now hold some amount in trust, though the amounts are generally quite small, as 93 percent of state liabilities remain unfunded. Also a December 2014 issue brief from National Association of State Retirement Administrators and the Center for State and Local Government Excellence highlights the relative distribution of state OPEB assets and unfunded liabilities. [added Dec. 2014]

Elected state legislators naturally are state employees; however within state personnel definitions, some are considered part-time employees.  The following states offer health insurance to legislators but describe it as "optional at legislator's expense" -- Nebraska, Nevada, New Hampshire, New Mexico, Vermont and West Virginia. In addition,  South Dakota and Wyoming do not offer health benefits to legislators, but do cover legislative staff.

At times states have used their employee benefit plans as a demonstration for a policy or idea - for example several states initiated a mental health coverage mandate specific to the state plan. At least half the states provide for selected non-state employees to be covered under the same, or parallel, health benefit plans.  Most commonly, states include: city, town and/or county workers; public school teachers or employees, or public higher education employees.  A few states have experimented with including segments of the general population in their state plan - see the examples from Connecticut and West Virginia, below.   In the past several years there also are some trends or innovations listed and linked below, including:


 Premium Rates for Employers & Workers, '13 | ACA Effects on State Programs

 State Employee Health Plan Agencies 


Health Savings Accounts

 Self-funded state programs | Premium Surcharges for smoking

 Retiree Benefit cutbacks 


State Contractors to Provide Health Ins.

 State plus local enrollees pooled 


State Employees' Children covered by CHIP

 Wellness Programs for Employees

| Same-Sex Marriage and Domestic Partner Benefits

This web-based report pulls together diverse resources on this growing area of health and personnel policy.

♦ 2013 State Employee Health Premiums: Family and Individual Coverage - Provides state examples of the employer share, the employee share and total premium for 25 states, collected through summer, 2013. Results published by NCSL and posted 4/1/2014.  [download report
♦ 2012 State Employee Health Premiums: Comparative data for 45+ states.  [download report]


♦ Reducing State Employee Health Insurance Costs - NCSL LegisBrief, October, 2014 [download report - member password may be required]"NEW"

♦ 2014 State Employee Health Spending Report released by Pew (August 2014)

A groundbreaking new report examines how states’ employee health plan benefits and costs compare to one another and to other large, private sector employers. The State Health Care Spending Project has worked with global actuarial firm Milliman, Inc. to examine each state’s employee health plan spending and design characteristics, as well as how states compare to one another and to health plans offered in the private sector. The result is nationwide comparison benchmarks never before available to policymakers and other stakeholders.  Download report. 
> View related State Employee Health  
PowerPoint presentation to NCSL on Aug. 22 by Maria Schiff from Pew. [PDF]

Minnesota, Employee Group Insurance Program: PowerPoint presentation to NCSL Midwest States Fiscal Leaders Meeting, Aug. 19, 2014. [PDF]

Key findings from the Pew analysis include:

  • Average per employee premiums; before and after controlling for certain cost-drivers
  • Employer and employee premium contribution arrangements
  • Plan characteristics, including cost sharing arrangements (deductibles, copays, coinsurance)
  • Major cost drivers and sources of spending variation among states, and between states and large private sector employers
  • Key policy approaches available to state policymakers to influence costs

♦ Value Based Purchasing Strategies for State Employees - sponsored by Catalyst for Payment Reform; a KPMG Report, November, 2014. (20 pages; PDF)


♦ A Center for State and Local Government Excellence (SLGE) survey released this month found that 57 percent of respondents made employees pay more for their premiums, 19 percent moved to a high-deductible plan with a health savings account, and 14 percent set up a health reimbursement program, which pays employees for out-of-pocket medical expenses and premiums. Some respondents reported decreased costs as a result of dependent-care audits and on-site clinics. Corpus Christi, Texas, for example, has saved $1.84 million in health-care costs by starting an on-site clinic for its 3,000 employees and running an eligibility audit on all dependents covered by city health insurance plans, which helped to remove ineligible participants.


 NCSL sessions: The ACA Impact on States as Employers.The ACA affects states in many ways. One of the least explored roles of state governments and the ACA is state government’s role as an employer.  This session highlights important issues for states as employers. (8/20/2014) Speaker: 

  How Health Reform Affects States as Employers (December 2012)

In many places state government is the single largest employer. Federal health reform changes some provisions of state employee insurance – programs that affect coverage for more than 6 million enrollees nationwide, including most NCSL members. Speaker: J. Richard Johnson, Senior Vice-President, National Public Sector Health Practice Leader, Segal & Company, Washington, D.C.- "PowerPoint" (PDF file online-16 pages)

  • "2013 State Legislator Compensation- Health, Dental and Optical Benefits" - compiled and researched by NCSL Legislative Management Program.  Request your copy by email  8/2014.



 In The News...
The following reports and news articles are examples of the policy discussions in individual states.  NCSL is not responsible for the content or opinions expressed in these outside linked articles.

States Implement Reform image

Health Reform News for State Employee Plans

The Affordable Care Act (ACA) creates some new requirements and new options for state and public employee health programs.  Examples are summarized below.

CMS overview of  "Self-Funded Non-Federal Government Plans"  The Affordable Care Act has given Americans new rights and benefits, by helping more children get health coverage, ending lifetime and most annual limits on care, allowing young adults under 26 to stay on their parent’s health insurance, and giving patients access to recommended preventive services without cost.

Prior to enactment of the Affordable Care Act, sponsors of self-funded, non-federal governmental plans were permitted to elect to exempt those plans from, or “opt out of,” certain provisions of the Public Health Service (PHS) Act. This election was authorized under section 2722(a)(2) of the PHS Act (42 USC § 300gg-21(a)(2)).  The Affordable Care Act made a number of changes, with the result that sponsors of self-funded, non-federal governmental plans can no longer opt out of as many requirements of Title XXVII. On March 14, 2014, the Department of Health and Human Services, Centers for Medicare and Medicaid Services, published a proposed rule titled “Patient Protection and Affordable Care Act: Exchange and Insurance Market Standards," with details on "Non-Federal Governmental Plans." related to exemptions listed below. 

This section is intended to provide information about this opt out provision.  The information in this section will be of interest to state and local governmental employers that provide self-funded group health plan coverage to their employees, administrators of those group health plans, and employees and dependents who are enrolled, or may enroll, in those plans.  Although self-funded nonfederal governmental plans may still opt out of certain provisions of the PHS Act, they are not exempt from other requirements of the law including the restrictions on annual limits and other provisions of the Patient’s Bill of Rights. 

Provisions subject to opting out included:

  • limitations on preexisting condition exclusion periods; requirements for special enrollment periods; prohibitions on health status discriminations;
  • newborn and mother benefits standards; mental health and substance abuse disorder benefit parity requirements; coverage of reconstructive surgery after mastectomy requirements; and coverage of dependent students on medically necessary leave of absence.

Under the ACA, self-funded non-federal governmental plans may no longer opt out of the first three of these requirements, although they may still opt out of the later four.  Group health plans maintained pursuant to a collective bargaining agreement ratified before March 23, 2010, however, that were exempted from any of the first three requirements do not need to come into compliance with any of these provisions until the first plan year following the expiration of the last plan year governed by the collective bargaining agreement.  These changes had earlier been implemented by guidance, but the proposal would modify the existing rule to bring it into conformity with the statutory provisions.  The amendment would also require electronic submission of the opt-out.

Additional Resources: Fact Sheets & FAQs  |  Other Resources  [includes material added 7/10/2013]

  • The Impact of the So-Called "Cadillac Tax." - Fact sheet by Health Leaders Media and Truven Health Analytics, October 2014. (2 pp., PDF)
  • Health Care Law Raises Pressure on Public Unions - "The so-called Cadillac tax inserted into the Affordable Care Act will tax expensive health insurance plans like those obtained by powerful unions, and switching to cheaper plans will not be easy." New York Times, 8/5/2013
  • FAQs about Grandfatherd Health Plans in 2014 - Important facts and requirements; compiled 8/26/2013 by United Benefit Advisors.
  • State Plans as Essential Health Benefits Template. The HHS bulletin issued December 16, 2011 on Essential Health Benefits allow states to use "one of the three largest state employee health plans" as the coverage standard for all non-grandfathered health insurance plans offered in and out of exchanges. As of mid-2013, two states selected this option --- Details online.

HIPAA Exemptions for Public Employer Health Plans

HIPAA Opt-Out Materials: Memo on Amendments to the HIPAA Opt-Out Provision made by the Affordable Care Act (PDF – 44 KB) CMS, 9/21/2010

Procedures and Requirements for HIPAA Exemption Election  | Model HIPAA Exemption Election Document (PDF – 78 KB) - 4/1/2011  |  Model Notice to Enrollees of HIPAA Exemption (PDF – 7 KB)

Children of State Employees.  On April 4, 2011 CMS issued a letter and Q’s and A’s from Cindy Mann, Director, regarding Children of state employees and the Affordable Care Act. Under previous law, the children of state government employees were not authorized to participate in the Children’s Health Insurance Program (CHIP).  The ACA authorizes the inclusion of the children of state government employees under two conditions:  (1) the state has maintained its contribution levels for coverage for employees with dependent coverage, looking back to 1997); OR (2) the state can demonstrate that the state employee’s health benefit program’s out-of-pocket costs pose a financial hardship for families (premiums and cost-sharing would exceed 5% of family income).

 List of State Employee Health Plan Agencies with Links

Each of the states has evolved a distinct structure for administering state employee health benefits.  Many states offer a relatively complex matrix of plans and premiums, varied by family size, type of plan (HMO, PPO, Indemnity).  A majority of states have some type of employee unions or collective bargaining units that may play a substantial role in defining benefits and costs.  The table below provides some examples from the agencies that run these state programs.


Agency Administering State Employee Health  
also see 50-state Personnel Departments (NASPE link)

Examples of premiums & benefits (state web links*)


Alabama State Employees Insurance Board;
Alabama Public Education Employees Insurance [link: 4/2014]

2011 | 2012 | 2013


Alaska Benefits Section, Department of Administration



Arizona Benefit Options (AzBO), Dept. of Administration

 2011 | 2012 | 2013


Arkansas Employee Benefits Division   [wellness program]

2009 l 2010 l 2011 l 2012 | 2013


CalPERS - California Public Employees Retirement System

 2003 - 2012


Colorado Dept. of Personnel & Administration, Division of Human Resources

2012 - 2013


CT Retirement and Benefits Services Division, State Controller

2011-12 | 2012 - 2013


Delaware Statewide Benefits Office, Office of Management and Budget

 2011 | 2012 - 2013


Florida Div. of State Group Insurance

 2011 - 2012 | 2013


State Health Benefit Plan (SHBP) Division

 2012 | 2013


Hawaii Employer-Union Health Benefits Trust Fund (EUTF)



Dept. of Administration: Employee Group Insurance Benefits (24,000 employees 12/10)

2012 | 2013


Bureau of Benefits, Dept. of Central Management Services



State Personnel Dept.: Benefit Information

 2012 | 2013 | 2014


Department of Administrative Services, Human Resources Enterprise

 2011 | 2013


Kansas Department of Health and Environment



Dept. for Employee Insurance, Kentucky Personnel Cabinet   (245,000 people covered 11/07)



Department of State Civil Service

FY 2010  l 2011 | 2012 | 2013


Maine Div. of Employee Health and Benefits

FY 2011 | 2012 | 2013


Maryland Department of Budget & Management

FY 2013


Massachusetts Group Insurance Commission (413,000 covered lives)

 2011 | 2012 | 2014-15


Michigan Employee Benefits Division

 2009-10 | 2010-11 | 2011-12


Dept. of Employee Relations, Benefits Division



MO Consolidated Health Care Plan

 2011 l 2012


State Insurance Admin., Department of Finance and Administration

 FY 2009-10 l 2011 | 2012


Employee Benefits Bureau, Health Care and Benefits Division



Nebrasks Office of Aministrative Services: Benefits |
Office of Risk Management

2012 - 13 | 2013-2014


Public Employees Benefit Program

 FY 2010 | FY 2011 | FY 2012

New Hampshire

Human Resources, Department of Administrative Services | Health Benefits

 2009 | 2011 | 2012 | 2013

New Jersey

Health Benefits Bureau, Div. of Pensions and Benefits

 2012 | 2013

New Mexico

General Services Division     
[Anual report: Public Employee Health Benefit Plans- Dec. 2013]


2012 - 2013

New York

Employee Benefits Division, Dept. of Civil Service | Governor's Employee Rel.

 2010 & 2011  | 2013

North Carolina

NC State Health Plan  (667,000 state & local employees and retirees)

 2011-2012 | 2012 - 2013

North Dakota

North Dakota Public Employee Retirement System: Group Health Insurance Plan



Ohio Department of Administrative Services: Benefits 

 2010-11 | 2012


Oklahoma Employee Benefits Council [updated 4/2014]

 2012 | 2013 | 2014


Public Employees Benefit Board (PEBB), Oregon Educator's Benefit Board (OEBB)
(128,000 state individuals covered; Educators include 155,000 enrolled in 2010)

 2009 | 2010 | 2011


PA Employees Benefit Trust Fund (PEBTF)   (144,000 state employees, retirees, dependents)


Rhode Island

Department of Administration


South Carolina

Employee Insurance Program, SC Budget and Control Board.
(244,000 employees; 400,000 lives covered)

 2011 | 2012 | 2013

South Dakota

Bureau of Personnel

 2011 | 2012


Insurance Administration, Dept. of Finance & Administration

 2012 | 2013


Texas Employees Group Benefits Program (GBP), Employees Retirement System (ERS)



Public Employees Health Program

unavailable 2014


Department of Human Resources, State Employee Center



Benefits, Department of Human Resource Management

2010-112011-12 | 2012 - 2013


Public Employees Benefit Board (PEBB) 
(229,000 active employees, 335,309 covered members in 2009)

2009 | 2010 | 2011| 2012 | 2013

West Virginia

West Virginia PEIA  [link update 1/10]
(73,000 public employee policyholders; 175,000 covered members in 2008; plus 34,000 retirees in Retiree Health Benefit Trust (RHBT)

 2010 l 2011 | 2012 | 2013


Division of Insurance, Dept. of Employee Trust Funds

 2008  | 2009 l 2010 | 2011 | 2012 | 2013


Department of Administration and Information, Human Resources Division

 2011 | 2012 | 2013

Notes: Plan benefits vary widely from state to state. Numerous states offer a range of plans from basic HMO, to comprehensive HMO, plus PPO and an Indemnity plan. Some have regional pricing as well. Family size almost always affects premiums. For example Louisiana has scaled prices for 1) Single, 2) Single with spouse, 3) Single with children, and 4) Family.  Retirees often have separate premiums and benefits.  Premium rate links (above) connect to state agencies' pages that may change or be deleted without notice.

Health Care Reimbursement Accounts (HRA) - The pre-tax flexible spending accounts that many employees use to cover expenses not covered by insurance, as allowed by IRS Section 125.
Voluntary Employee Beneficiary Association (VEBA) - The federal government allows entities to receive favorable tax treatment on contributions to a trust set up under section 501(c)(9), IRC. Contributions to this trust may be made on a pre-tax basis, assets in the trust may be invested and earnings are tax-exempt, and certain qualified benefits may be paid out on a tax-exempt basis. States also may allow favorable tax treatment for a VEBA trust.  See Montana's example and explanation:

 States That Self-Insure and Self-fund Their State Employee Health Program

Forty-six (92%) of the fifty states now self-insure and/or self-fund at least one of their employee health care plans.  At least 20 states (40%) self-fund all of their health plan offerings, indicated below as [♦]. A self-funded plan means that insurance is not purchased, but rather, the state and employee out-of-pocket insurance contributions are pooled and used to pay claims; a commercial health plan (insurer) or plans often administer the services and benefits for the state program.

See Utah's example, "Why Self-funding matters” online at [link: 4/2014]  

As of 2010 the self-funding states are:

Alabama ♦
Alaska ♦
Arizona a
Arkansas ♦
Colorado b
Connecticut c
Delaware ♦
Hawaii d
Idaho ♦

Kentucky ♦
Minnesota ♦
Mississippi ♦
Montana ♦ 

New Hampshire ♦
New Jersey
New Mexico ♦
North Carolina ♦
Oklahoma ♦
Oregon (2010)
Pennsylvania ♦ g
Rhode Island ♦
South Carolina
South Dakota ♦

Tennessee ♦
Vermont ♦
West Virginia ♦


a -AZ self-funds all PPO and EPO policies as of 2014, also has fully insured plans primarily for a smaller number of state university employees.
b -CO self-funds 3 PPOs, 1 HSA, also fully insures 2 HMOs.
c -CT passed 
d -HI self-funds PPOs and HDHP as of 2007, also has fully insured HMO.
e -NE was added to list in 2010. In a 2007 commercial survey they were reported as "considering implementing a self-funded program in the future."
f - Oregon switched in 2010
g - Pennsylvania offers an indemnity plan to the legislative branch.

All states with self-funded plans contract with outside vendors to provide some type of administrative service. Services include claims payment, utilization review, disease management and pharmacy benefit management. The state of Louisiana was the first state reporting that claims administration and payment is handled in-house. Pennsylvania pays a limited number of claims internally for their supplemental medical plan.

Examples of 2003-2010 Plan Features and Changes


At least nine states now charge or authorize lower premiums to non-smoker state employees and higher premiums to smokers.

  • West Virginia first included such a feature in part several years ago.
  • Kentucky in late 2004, (in H 1a) created a smoker surcharge of $15/month for individuals and $30/month for family coverage. [2008 article]
  • Alabama in December 2004 (in HB 2) authorized smoker rates during special legislative sessions.  For 2010 the smoker surcharge increased from $25 to $30 per month.  In August 2008, Alabama added a premium for obesity [see description below]
  • Georgia initiated a smoker surcharge.  Beginning July 2005, more than 54,000 people covered by the insurance plan for state employees are paying an extra $40 per month because they smoke or use tobacco. For 2013, an additional $80 will be added to the monthly premium if you or your covered dependents use Tobacco products.
  • Indiana added a non-smoker rate incentive in 2006.  For 2007, enrollees save up to $500 /year on annual deductibles when the Tobacco Incentive is applied.
  • Kansas has a smoker surcharge authorized in 2008.
  • Missouri law generally provides that public and private employers may provide health insurance at a reduced premium rate and reduced deductible level for employees who do not smoke or use tobacco products.
  • North Carolina has taken a parallel approach. Beginning July 1, 2010, state employees will be defaulted into the state’s PPO Basic plan. Those who don’t smoke have the option of enrolling in the Standard plan—which has an 80/20 enrollee payment split compared with 70/30 enrollee payment split  under the Basic plan—by attesting that they and their dependents do not use tobacco products.
  • South Carolina's Budget and Control Board voted in August 2008 to impose a $25 monthly surcharge for state public employees and their family members who smoke or chew tobacco, effective 2010.  According to the Augusta Chronicle, an estimated 58,600 people, or roughly 20 percent of the state's more than 400,000 insurance participants, will pay the surcharge.
  • South Dakota has a smoker surcharge authorized in 2008.


A growing number of states, totaling 39 as of March 2010, have launched tobacco cessation programs and policies, primarily using positive incentives, high visibility marketing and some assessment requirements to meet reduced tobacco use goals.  The following are just a few examples.


  • 50-state map of State programs

    • Tobacco Cessation: State and Federal Efforts to Help - NCSL report features 50-state map, laws and program information.

    • Alabama's Tobacco Cessation Program is now provided by the SEIB for its covered members; for 2009 the state will reimburse each member 80% of the cost of the program, with no deductible. There is a lifetime maximum benefit of $150. Tobacco cessation seminars and all forms of nicotine replacement are covered services.  Prescription medications for tobacco cessation are covered and are not subject to the $150 lifetime maximum benefit. [2/09]

    • Idaho’s Wellness Program: First Phase -Tobacco Cessation. For 2008 there will be a $10 co-payment for every thirty-day supply of quit aids.  Pharmacists will  require a state Blue Cross of Idaho identification card to dispense the quit aids.

    • North Carolina, "37 percent of all preventable deaths are attributed to tobacco. Each smoker represents approximately $1, 623 in excess medical expenditures. By making nicotine replacement therapy patches free with counseling, the State Health Plan anticipates improved member health and significant long-term savings for the plan and for taxpayers".

    • North Dakota's Public Employees Retirement System recently received a grant to help state employees and their dependents age 18 and older quit smoking or chewing tobacco. The grant will help pay for participating in one of more than 20 approved smoking cessation programs. Most of these programs are available through public health departments across the state of North Dakota. This project is administered by Blue Cross Blue Shield of North Dakota. The program will pay 100 percent of your out-of-pocket expenses for your office visit and prescription and over-the-counter medication up to $500, for a total benefit of $700. The program will end April 30, 2009.  Program description.

WELLNESS PROGRAMS for state employees becoming more widespread.

U.S. Dept. of Labor ISSUES CHECKLIST FOR WELLNESS PROGRAMS.  Wellness programs must be carefully reviewed to assure that they fit within a variety of legal boundaries. Particularly important for 2008 and beyond are the nondiscrimination rules under HIPAA. The Department of Labor (DOL) has issued helpful guidance in Field Assistance Bulletin 2008-02 (FAB 2008-02), including a useful checklist. This guidance can be reviewed by any policymaker or plan sponsor implementing a wellness program or considering one. "CheckUp" by Sibson, 3/10/08

  • List of state statutes for Public Employee Wellness, 2006-2010  (updated 7/31/2010)
    (Includes Illinois, Kentucky, Maine, Mississippi, North Carolina, Oklahoma, Texas and Washington)

  • State Employee Health Benefits: Coverage for Weight Loss Interventions - 50 State  Survey – published by George Washington University [Link added Feb. 2012]

  • Alabama is the first state to seek to charge overweight state workers who don't work on slimming down.  The State Employees' Insurance Board in August 2008 approved a plan to charge state workers starting in January 2010 if they don't have free health screenings. If the screenings turn up serious problems with blood pressure, cholesterol, glucose or obesity, employees will have a year to see a doctor at no cost, enroll in a wellness program, or take steps on their own to improve their health. If they show progress in a follow-up screening, they won't be charged. But if they don't, they must pay starting in January 2011. The State Employees' Insurance Board implementation plan also includes a discount for participation in Wellness Screenings, with a $30 per month wellness premium discount off the single coverage provided the employee has submitted baseline readings for the following health risk factors: Blood pressure, Cholesterol, Glucose and Body mass index.

  • Arkansas Incentives for Wellness.  Arkansas provides health care benefits through plans offered to state and public school employees and their families, covering approximately 120,000 people. In this role, the state has a financial interest in improving the health status of this population. In 2004, it began a long-term strategy to avoid preventable diseases and encourage healthy behaviors. It introduced Health Risk Assessments (HRA) to gauge member behaviors in five areas: smoking, alcohol consumption, seat belt usage, body mass index, and weekly physical activity.  The state’s strategy relies heavily on incentives for positive behaviors. Members who complete an HRA receive a $10 monthly discount to their health insurance premium; those who are found to be at low risk receive an additional $10 discount. In 2005, more than half of members completed the HRA. Arkansas has introduced enhanced tobacco cessation and obesity management (including nutrition counseling) benefits, and has proposed a further expansion of coverage for clinically directed weight-loss programs and surgical obesity interventions. State employees who assist in management of their health risks are also eligible for three days of vacation, known as “health days.”  This is complementary to the state’s effort, through the Healthy Arkansas initiative, to advance the idea of “worksite wellness.” This effort promotes the notion that because adults spend most of their waking lives at work, work environments should promote healthy choices and healthy behaviors.  Arkansas also has an expanded Healthy Lifestyle program, whereby state employees can earn up to three days per year for participating in a voluntary program that focuses on increasing physical activity, increasing consumption of fruits and vegetables and decreasing or eliminating the use of tobacco products.  See savings examples in the 2009 premium rate chart.
    Arkansas Wellness Benefits (updated Sept 2009).  [Sources: Arkansas Governor’s Office SHAPES survey response, presentation by Rhonda Jaster, presentation by Joseph Thompson.]

  • Connecticut: State Plan Offers Employees Incentives To Access Needed Services and Health Enhancement Activities, Leading to High Participation, More Appropriate Utilization, and Slower Cost Growth. Read the full report January 2014. by AHRQ.

  • Delaware officially launched DelaWELL on April 1, 2007, as a comprehensive wellness program for state employees. This statewide initiative is available free to all full-time State employees, school district, charter school and higher education employees and pre-65 retirees currently enrolled in group health insurance programs. The program assesses employee health risks and provide confidential, personalized feedback, and coaching interventional strategies that target lifestyle topics such as back care, blood pressure management, exercise, nutrition, and stress management through various modes of communication and health-related events.
    >  Starting October 1, 2010, eligible members earn Wellness Credits for participating in program activities; credits can translate into DelaWELL Rewards of $100-$200.

  • Indiana: The state personnel health plan has a cutting edge “Upgrade your health plan” that lowers premiums for documented healthy actions. For 2014-15 they descriribe it this way: "To qualify for the Wellness CDHP plan, employees currently enrolled in state medical benefits qualify for the Wellness CDHP plan by completing three easy steps before Aug. 31, 2014. These steps help you to take control of your health and improve your overall well-being. By upgrading your health, you have the opportunity to upgrade your plan." [Updated 6/2014]

  • Kansas, in September 2007, launched a program so that state workers will be able to volunteer for personal health-risk assessments.

  • Minnesota highlights various health improvement services offered through the Minnesota Advantage Health Plan for insurance-eligible state employees and their covered family members. An online wellness chart provides details for 2010. [6/10]

  • Massachusetts: For 2014 most active state employees have an opportunity to improve their health with the GIC’s pilot WellMASS program; it "provides helpful tools to improve participant’s health and wellbeing including Health Assessments, Online Resources and Health Coaching for eligible participants." [Updated 6/2014]

  • Mississippi2010 "Healthy You!" Health/Wellness Initiative, administered by BC/BS of Mississippi.

  • Missouri has incentive rates for employees, saving up to $25 /mo, who take the PHA and participate in Lifestyle Ladder or Smart Steps® to be eligible for the incentive rate.

  • Montana announced Wellness Programs including, new for 2007, all State employees and their adult dependents have access to free health coaching, intended to "help individuals make permanent changes in their lives."  The wellness program also offers options such as health screenings, spring fitness, and lunch and learn programs, which are designed to maintain and promote healthy lifestyles for members.  New features for 2010.

  • New Hampshire's wellness program includes a risk assessment, run by Anthem. (2008)

  • North Dakota wellness services are included in the state BC/BS managed plan.

  • Ohio: The Healthy Ohioans initiative, which includes wellness activities and resources, is sponsored by the State Employee Health and Fitness Taskforce. The taskforce was charged with: (1) developing guidelines for state agency health and fitness programs; (2) identifying tools to annually measure the effectiveness of such programs; (3) identifying models for on-site wellness programs; and (4) identifying community partnerships or resources that might be utilized to further wellness programming for state employees. For 2010 Ohio's "Take Charge! Live Well!" program can earn employees a $25-$200 incentive payment.

  • Oklahoma in 2006 launched "OK Health wellness program," providing "All active state employees the opportunity to participate in the state's wellness mentoring program offered by the Employees Benefits Council State Wellness Program.  The goal of OK Health is to give you the right tools to help you feel better and improve your health."  Enrollment in the OK Health Program,  involves completing an online health risk assessment (HRA). An OK Health representative will call and arrange an initial visit with your Primary Care Physician for some basic measurements and labs.  They say, "As a program participant, the initial cost to visit your physician and receive lab work (specific to OK Health) will be waived by your health care provider.  Following your initial PCP visit, you will receive your first orientation call from a professional health mentor."

  • South Dakota: For 2010, members who attend a free Health Screening will receive a $50 non-tax Health Screening incentive.

  • Utah Public Employee Health Plan Wellness Works is an interactive PEHP Wellness Works website for diet, nutrition, and fitness support exclusively for PEHP members. For 2011, it offers an array of customizable tools and wellness information.  PEHP Waist Aweigh is for PEHP members with a BMI of 30 or higher. It provides support, education, and financial incentives.  Healthy Utah  is a free program for eligible PEHP members and their spouses. It offers a variety of programs, services, and resources to help you get and stay well. Among its many tools and services is a rebate program that offers cash rewards for good health and health improvements.  Enrolled employees may submit results to Healthy Utah and receive rebates for making the health improvements in the following areas:  BMI Improvement ($50 each drop of 5 BMI points); Blood Pressure Improvement ($50); Diabetes Management ($300); Lipid Improvement ($50); Tobacco Cessation Program ($100).

  • Virginia: (2007-08):  Routine wellness care is covered for children through age 6 and for children and adults age 7 and over. There is no deductible, copayment or coinsurance for the member to pay before the plan pays for routine wellness coverage.  Routine well child care through age 6 covers at no cost office visits at specified intervals, immunizations, routine lab tests and x-rays at facilities and doctors’ offices. Routine well adult care age 7 and older includes a routine annual wellness check-up at no cost, as well as routine lab tests, immunizations and x-rays at facilities and doctors’ offices.  Preventive care benefits include for specified ages at no cost an annual gynecological exam or prostate exam, and the following services once per calendar year: a Pap test, mammography screening, prostate specific antigen (PSA) test and colorectal cancer screening.

  • Washington: Washington Wellness, 4 Steps to Better Health, 2010

    • Wellness Initiative, 2006: King County, which comprises the greater Seattle area and is the 12th largest county in the nation, is projecting a reduction in rising healthcare costs by as much as $40 million over the 2007-2009 period due to wellness initiatives. (10/17/06; link update 6/10)

  • West Virginia created the Pathways to Wellness program by law (W. Va. Code § 5-16-8). It requires the Public Employee Insurance Plan to provide wellness programs and activities which include benefit plan incentives to discourage tobacco, alcohol and chemical abuse and an educational program to encourage proper diet and exercise. 

HEALTH SAVINGS ACCOUNTS: Early examples of states offering HSA's to their state employees:

By 2014 a large majority of states offer some type of Health HSA and high deductible combination health coverage.  The states listed below were the "early adaptors" , with up to a decade of experience.

  • Arkansas: (2004) For teachers, first-year open enrollment in 2004 results were reported as "disappointing."
  • Florida: (2005) The state contributed $500 for an individual, $1,000 for a family account and paired that with a $1,250 (individual) $2,500 (family) deductible plan.
  • Georgia offers a health reimbursement account (HRA) plan and a high deductible health plan (HDHP) that are very similar in design to the PPO with higher employee costs through deductibles, co-pays, and co-insurance. Public employees hired after January 1, 2009 in Georgia are only given the option of enrolling in the HRA/HDHP plans.
  • Indiana: (2007) The state offered two HDHP/HSA choices.  Plan 1 has a $2,000 individual/$5,000 family deductible; the state's annual contribution includes up to $1,375 for single or $2,750 annually for family to the HSA for active employees; the out-of-pocket annual maximum is $8,000.  Plan 2 has a $3,400 family deductible.
  • Kansas: (2006) added an HSA/HDHP choice with a $1,500/$3,000 deductible if network providers are used and a $2,000/$4,000 deductible if non network providers are used. [KS HSA plan]
  • Nebraska: (2007) offered a PPO Consumer Driven Health Plan. The CDHP has a $1,000 per calendar year deductible for in-network expenses with a $2,000 per calendar year maximum out of pocket. In addition, the new CDHP implements a four-tier formulary prescription plan with higher co-pays and/or co-insurance.
  • Pennsylvania: (2009) Offered a UnitedHealthCare CDHP option as of 2006. In 2009 it features 100 percent coverage for preventive care services (PEBTF members have up to $500 maximum for single members/$1,000 for family per year).
  • South Carolina: (2004) The plan conducts state employee open enrollment at the end of each October.
  • South Dakota offered a $2000 deductible HSA-compatible plan for 2007; employees selecting this options receive $300 per plan year in Flex Credits in a Medical Expense Spending Account.  An offered $1000 deductible plan is not HSA compatible.
  • Utah: (2006) HB 76 requires a High Deductible Health Plan and HSA option for Public Employees Benefit and Insurance Program (PEHP).
  • Virginia: For benefit years 2007-10, the state paid 100 percent of the premium cost for a high-deductible health plan (individual or family), with other plans requiring modest employee contribution (HDHP is $40/mo less expensive than the full HMO option for an inividual, as of 7/09.)
  • Wyoming: (2006) implemented a federally-qualified high deductible health plan.  Employees may select a state HSA vendor or their own. HSA contributions are 100% from employees.

Federal health law offers new benefits for children of state workers

The Affordable Care Act (ACA) of 2010  lifted a ban on state employees enrolling their children in the federally subsidized Children’s Health Insurance Plan (CHIP).  This little discussed provision can provide relief from the federal 13-year long restriction considered  unfair by many low-income teachers, university staff and other members of the state workforce.  As of November 2011, only six states had completed the process to take advantage of this provision.

CMS Guidance and Q & A's,"CHIP Coverage of Children of Public Employees," issued April 4, 2011.  The new federal guidance states the following:

'In response to States’ repeated requests for Federal support in this area, Congress added the new option for States in the Affordable Care Act. Specifically, section 10203(b)(2)(D) of the Affordable Care Act amends the definition of a targeted low-income child in section 2110(b)(2)(B) of the Act by permitting States to extend CHIP eligibility to children of State
employees who are otherwise eligible under the State child health plan to the extent that one of two conditions is met. These conditions are described in a new section 2110(b)(6) (added by the Affordable Care Act and amended by Public Law 111-309) of the Act and will be referred to as the maintenance of agency contribution condition and the hardship condition. States now have the opportunity to receive Federal funding to provide CHIP coverage to children of State employees when either of these conditions is met.'

In January 2012, CMS officials clarified that the effective date for coverage, which state agencies are included, and even which employeee familiies qualify generally are state decisions, normally reported within a CHIP state plan amendment.  For example a state's existing eligibility process may mean that adding the CHIP option would become a "qualifying event" because it can result in a premium change, meaning that adding or shifting dependents can be effectve immediately rather than waiting for an annual enrollment window.

Alabama, Georgia, Kentucky, Montana, Pennsylvania and Texas (as of 1/25/2012) have cleared the federal regulatory requirements, usually a  state plan amendment, needed to make the federal benefit available to state government workers and their families. All states that applied have been approved so far.  According to an analysis by Stateline, (December, 2011) the number of states using this feature seems low "despite the fact that the provision has the potential to save states millions in employee benefits, lower the number of uninsured children, and improve the household income of thousands of low-wage state workers."


  • Oregon's Experience With Value-Based Insurance Design: In 2010 two Oregon public employee benefit boards adopted a value-based insurance design system that is showing results, writes Joan Kapowich, who administers Oregon's Public Employees' Benefit Board and Educators Benefit Board. This article presents lessons learned from offering value-based tier benefit plans for 128,000 state and university employees and dependents and 155,000 public education employees and dependents. The plans increased copayments for overused or preference-sensitive services of low relative value and they covered preventive and high-value services at low or no cost. Kapowich says one lesson is that many purchasers will choose the path of least resistance and increase traditional cost sharing, rather than add copay disincentives to their value-based benefit programs, to avoid employee pushback. Source: Health Affairs November 2010.

  • The idea of "value driven purchasing" through pooled negotiation, common contracts and purchases is often discussed but less commonly implemented.  Four states have initiated or joined such efforts, and now have handy reports written and published through the Commonwealth Fund in 2006 and 2007.

    • In California, CalPERS offers lower health premiums in 2009 if members enroll in one of the "newer plan options – Blue Shield of California NetValue (HMO) and PERS Select (PPO). These “high performance network” plans provide the same level of benefi ts and quality of care as Blue Shield Access+ HMO and PERS Choice, respectively. The difference is that enrollees pay a lower premium in exchange for choosing from a smaller panel of physicians.  A CA example" "To illustrate the value of a high performance network plan, let’s use the example of a State member who currently has health coverage for herself and her family (husband, 4-year old child, and a baby on the way) through Blue Shield. If this member transfers from the standard Blue Shield Access+ HMO family plan to Blue Shield NetValue, she would save more than $1,800 in premiums in 2009. She could use this savings to pay for additional health care services for her family, such as co-payments for 20 office visits for non-preventive care, 20 retail generic drug prescriptions, 20 retail brand prescriptions, 4 mail-order brand prescriptions, 4 mail-order nonformulary prescriptions, 12 urgent care visits, and 4 emergency room visits (without being admitted) – and still keep an extra $348 in her pocket.

    • The Massachusetts Group Insurance Commission (GIC), a state entity that provides and administers health insurance and other benefits to the commonwealth's employees, retirees, and their dependents and survivors, is trying to improve provider performance through "tiering." GIC assigns its health plan members to a particular tier, based on quality and efficiency, and requires these plans to offer their members different levels of cost sharing, depending on which tier their chosen hospital or provider is designated.  8/07.

    • The Minnesota Smart Buy Alliance is a group of public and private health care purchasers, including the state agencies overseeing Medicaid and public employee health benefits, along with coalitions of businesses and labor unions. The alliance is developing common value-driven principles, and its members are sharing VBP strategies.  8/07

    • Washington State's Puget Sound Health Alliance, a broad group of public and private health care purchasers, providers, payers (health plans), and consumers, is working to develop public performance reports on health care providers and evidence-based clinical guidelines.

    • The Wisconsin Department of Employee Trust Funds (ETF), the state agency that administers health benefits for state and local government employees, is pursuing value through a variety of purchasing strategies. EFT is also becoming involved in public-private collaboratives such as a statewide health data repository.  ETF is the largest employer purchaser in the state, covering more than 250,000 active state and local employees and 115,000 retirees and their dependents.**  The state also has a "high performance tiered" network structure - see description under Wisconsin, below.


More than half the states allow, and in a few cases require, state employee health plans to combine with other government employee participants.  These include:

  • Cities, towns and counties.  Permitted in AL, CA, HI, IL, LA, ME, MD, MA, MO, NJ, ND, NM, NY, OK, SC, TN, UT, VA, WA, WV and WI.
    * California's CalPERS agency provides the largest combined health program, serving 1.6 million  members; as of June 2009, 30% of their enrollees were state employees, 38% were school employees and 32% were local public agency employees. [CA report.] 
    * Massachusetts in 2008 expanded eligibility to all cities and towns.
    * New Jersey includes 31% public school employees, 18% cities and towns and 15% universities and colleges.
    * In North Carolina, the program has 58% public school employees and 11% universities and colleges. 
    * Washington enrollment includes 40% universities and colleges, 2% public schools and 3% cities and towns.

  • Universities and colleges. Permitted in at least 16 states: CA, HI, IL, LA, MA, NV, NJ, NC, ND, OK, OR TX, WV, MO, UT and WA.  13 other states classify state college employees as state employees and do not list them separately.

  • Public Schools. Permitted to be included in about 19 states including AR, DE, FL, GA, HI, KY, LA, MS, MO, NV, NJ, NY, NC, OK, SC, TN, UT, VA, WA and WV.  Actual practices vary considerably since no state directly runs its public schools.

  • Other local districts or units, such as fire districts, recreation districts.  Local statistics are not available .


For at least a decade, individual states created specific, sometimes inclusive, policies allowing coverage of domestic partners. This policy parallels initiatives of the largest employers. As of 2010, at least 22 states (plus D.C.) had "a law, policy, court decision or union contract that provide state employees with domestic partner benefits." Normally health care is covered within the term "benefits." 

-NEW-  With the rapid increase of binding court decisions, the landscape of coverage has shifted.  A map of same-sex marriage status as of October 2014 shows the latest decisions by jurisdiction, including 32 states and D.C.

State Same-Sex Marriage Laws: Legislatures and Courts

50-state map of same-sex and domestic partner status

By comparison, the earlier adaptors, as of 2010 included: 

 (domestic partnerships, 1999, expanded in 2005),
Colorado (designated beneficiaries, 2009),
Connecticut ,
District of Columbia  
(also same-sex marriages, 2009),
Hawaii (2004),
Illinois (civil unions, 2011) ,
(also same sex marriages, 2009),
(also same sex marriages, 2004),
Nevada (domestic partnerships, 2009),
New Hampshire (same-sex marriages, 2010),
New Jersey, (civil unions, 2007) ,
New Mexico,
New York,
(domestic partnerships, 2008),
Pennsylvania (effective July 2009),
Rhode Island,
Vermont (
also same-sex marriages, 2009),
Washington (domestic partnerships, 2007, 2009; same sex marriages, 2010),
Wisconsin (domestic partnerships,2009).
  • There are several additional states that prohibit discrimination against public employees based on sexual orientation/gender identity.  These states do not necessarily cover health care costs for a same-sex partner.  The states are: Indiana, Louisiana, Michigan and Virginia.  Some states with domestic partner benefits also prohibit discrimination, for example, Alaska, Arizona, Colorado and Pennsylvania.

    • State Retiree benefit programs now extend retirement benefits to domestic partners in about a dozen states, with descriptions of policies and debates in other states. See Domestic Partner Retirement Benefits: NCSL Survey of legislative staff (03/06)

    • Expedited Partner Therapy (EPT) - State Information - Legal status and barriers by state to providing medications to persons infected with certain STDs to be administered to their sexual partners. 26 states permit EPT; 16 states are classified as "potentially allowable" and eight states prohibt EPT.  The information applies generally, not just to public employees. (compiled by CDC, updated July 2010)


A few states require their private contractors to compensate their personnel using prevailing wage and benefit standards similar to public employees.

  • Illinois - Contractor employees must be paid prevailing wages and benefits and work under "conditions prevalent in the location where the work is to be performed." This applies to contracting in the areas of public works, printing, janitorial services, window washing and security guard services. 44 Ill. Adm. Code 1.2560.
  • Massachusetts - Contractors are required to provide their employees wages and benefits comparable to those paid to state employees performing similar services. The wages and benefits must be included in the bid and must be reported to the contracting agency on a quarterly basis. M.G.L.A. Ch. 7 Sec. 54.
  • California, Rhode Island and Washington require prevailing rates or wages for state contractors, but do not specify health coverage in statute.  The District of Columbia, Maryland and San Francisco, CA require paying a living wage.

RETIREE & PENSION PROGRAMS: Cutbacks  - Some Examples, 2007-2012

The retirement of baby boomers — 79 million born from 1946 to 1964 — will make it hard for state and local governments to keep up with the cost of medical benefits for retirees. What governments are doing recently (includes archive releases and reports):

  • 2011 Pension Legislation  - Pension plans have a major impact on state budget planning and lawmakers continue to address pension fund shortfalls. Read the details in our most recent summary of 2011 proposed legislation. Also check out this NCSL report that summarizes selected state pension and retirement legislation enacted from January to April 30 this year.
  • Illinois: State ends free state retiree health careMore than 80,000 retired government employees will have to start paying for health insurance under legislation Gov. Pat Quinn signed Thursday, ending a major benefit that Illinois had promised to employees.  Future state retirees will also have to pay under the legislation, part of a push to curb state spending on retirement benefits. That applies to roughly 200,000 people who already took government jobs with the understanding that they would not pay insurance premiums after retirement.  St. Louis Today/AP, June 22, 2012.
  • Results of the Segal Medicare Part D Survey of Public Sector Plans. A summer 2006 survey shows that 79% of public employee plans that responded took the federal 28% subsidy, but that more would reevaluate for 2007.


  • In 2009, 14 states paid for 100 percent of the monthly premium costs for a basic or "standard" health plan for some or all individual state employees (Alabama, Alaska, Delaware, Florida1, Iowa, Kentucky, Maine, Minnesota, North Carolina,  North Dakota, Oklahoma, Oregon, South Dakota & Texas)
  • In 2009, seven states paid for 100 percent of the "defined standard" monthly premium costs for at least some families of state employees. (Alaska, Delaware, Iowa2, North Carolina, North Dakota, Oklahoma and Oregon).

Alabama: Alabama was the first state to charge overweight state workers who don't work on slimming down, while a handful of other states reward employees who adopt healthy behaviors. The State Employees' Insurance Board in August 2008 approved a plan to charge state workers starting in January 2010 if they don't have free health screenings. If the screenings turn up serious problems with blood pressure, cholesterol, glucose or obesity, employees will have a year to see a doctor at no cost, enroll in a wellness program, or take steps on their own to improve their health. If they show progress in a follow-up screening, they won't be charged. But if they don't, they must pay starting in January 2011.

  • AL: Bill would increase health insurance cost for many Alabama teachers, public employees - Many teachers and other public employees in Alabama would pay more for health insurance under a bill filed by a state lawmaker, though their premiums still would be less than national averages.  State agency employees who don't smoke now pay nothing in premiums for single coverage and $180 per month for family coverage. Those monthly premiums would rise to $25 for single coverage and remain at $180 per month for family coverage starting Oct. 1, 2009.


  • (2014 update) The California Employees Retirement System (CALPERS), in collaboration with WellPoint, Inc., introduced reference pricing for knee and hip replacement surgery. This meant that the employer would pay a fixed fee - and no more - to have the operations done at high-quality, low-priced facilities. Beginning in 2008, employees who wanted to go to higher-priced facilities paid the difference. As a result, high-priced facilities cut their rates by one third.  However, the U.S. Department of Labor (DOL) is examining regulating this practice: Reference pricing aims to encourage plans to negotiate cost effective treatments with high quality providers at reduced costs. At the same time, the Departments are concerned that such a pricing structure may be a subterfuge for the imposition of otherwise prohibited limitations on coverage, without ensuring access to quality care and an adequate network of providers.

  • CalPERS offers lower health premiums if members enroll in one of the "newer plan options – Blue Shield of California NetValue (HMO) and PERS Select (PPO). These “high performance network” plans provide the same level of benefi ts and quality of care as Blue Shield Access+ HMO and PERS Choice, respectively. The difference is that enrollees pay a lower premium in exchange for choosing from a smaller panel of physicians.  A CA example" "To illustrate the value of a high performance network plan, let’s use the example of a State member who currently has health coverage for herself and her family (husband, 4-year old child, and a baby on the way) through Blue Shield. If this member transfers from the standard Blue Shield Access+ HMO family plan to Blue Shield NetValue, she would save more than $1,800 in premiums in 2009. She could use this savings to pay for additional health care services for her family, such as co-payments for 20 office visits for non-preventive care, 20 retail generic drug prescriptions, 20 retail brand prescriptions, 4 mail-order brand prescriptions, 4 mail-order nonformulary prescriptions, 12 urgent care visits, and 4 emergency room visits (without being admitted) – and still keep an extra $348 in her pocket.


  • Colorado has a separate agency, PERA, that administers health benefits for all retirees, including state and loacl jurisdictions.


  • With the FY 2012 budget deep in the red the governor sought concessions from the 15 employee unions represented by the group called SEBAC.  SEBAC negotiated a deal that creates a system with “Value Based Health Care.”  It keeps the increase in costs for employees to 5% for this year- starting July 1st, 2011. The answer was to save money by keeping employees healthier, a concept known as Value Based Health Care. It is based on employees signing a commitment form each year promising to get scheduled yearly physicals, age appropriate diagnostics (such as a colonoscopy), and two free dental cleanings per years. In addition, employees with one or more of the 5 listed diseases (Diabetes, COPD or ASTHMA, Hypertension, Hyperlipidemia (high cholesterol), and Heart Failure ) which respond particularly well to disease management programs and which are a large part of total healthcare costs ––must enroll and comply with the disease management programs. [Summary of the Plan - Connecticut 5/2011]
  • The new Connecticut Health Partnership (sHB 5536) allows municipalities, certain municipal service contractors, nonprofit organizations, and small businesses to provide coverage for their employees and retirees by joining the state employee health insurance plan. All new employees will be pooled with state employees in the state insurance plan if the State Employees’ Bargaining Agent Coalition consents. The act requires the comptroller to provide insurance for employers that seek to cover all their employees or all their retirees.  The law was effective September 1, 2008, except the definitions, the provision creating the advisory committees, and the SEBAC approval are effective upon passage, and the report and the authority for municipalities jointly to purchase health insurance are effective January 1, 2009.
  •  Public Act 03-149 of 2003 -  Authorizes the agency "To allow small employers and all nonprofit corporations to obtain coverage under the state employee health plan and to provide that such coverage be exempt from the state insurance premium tax." S 353 was signed into law June 2003.
  • Connecticut (effective 2008) provides for a reduced monthly employee contribution when both spouses are employed by the state.  For example, for family coverage a regular employee pays $122.85 per month, while a two-state employee household pays $50.57, a reduction of $72 for their household.

Delaware:  NCSL presentation on welness initiatives, by Kimberly Wells [PowerPoint download,] Deputy Principal Assistant, Office of the Director, Office of Management and Budget, Delaware.

  • DE: The State Employee Benefits Committee (SEBC) has awarded Blue Cross Blue Shield of Delaware and Aetna the contracts to administer the state group health insurance program, while dropping Coventry Health, effective July 1, 2007.

Florida  "Florida taxpayers foot bill for Gov. Crist, top lawmakers' health care subsidy." reports the Miami Herald, only six other states offer free insurance premiums to some employees and their families, according to the National Conference of State Legislatures. Even members of Congress pay monthly fees for health benefits. [Miami Herald, 11/30/09]

  • To state workers: get fit or lose your job? "The state's new secretary of Corrections, Mr. McDonough has proposed mandatory fitness levels for 19,000 of his employees – some of whom have desk jobs. It's meeting resistance from a union representing prison and probation officers and making experts wonder whether requiring workers to become physically fit, or risk losing their jobs, is the best way to tackle the country's growing obesity crisis. - news article, 1/31/07.
  • Florida: In May 2004 Governor Bush signed  HB 1837, which established the state employees' prescription drug program. The new program "shall create a preferred drug list" and shall be subject to new copayments (effective 1/1/04) as follows:  For generic drug with card....$10. For preferred brand name drug with card....$25.  For nonpreferred brand name drug with card....$40.  For generic mail order drug....$20.  For preferred brand name mail order drug....$50.  For nonpreferred brand name drug....$80.

Georgia:  The State Health Benefit Plan covered 664,703 people as of January 1, 2007. Teachers and school personnel represent almost 77% of the covered lives.

  • The state requires a $50 monthly "Spousal Surcharge" be applied to members whose spouse is eligible for coverage through his/her (non-state) employer but elects not to take the coverage. (2008, revised 2011)
  • A $40 Tobacco Surcharge applies to any member and/or one of his/her dependents who use(s) tobacco products. This surcharge is designed to encourage tobacco users to a healthier lifestyle. Smoking cessation classes are offered to members and dependents who want to stop using tobacco products. (2008)
  • Pharmacy Preferred Drug List (2010)
  • Tobacco Surcharge (2010)


  • A 2001 law, Chapter 87A of the Hawaii Revised Statutes, established the Hawaii Employer-Union Health Benefits Trust Fund. The Trust Fund "is to provide eligible state and county employees, retirees, and their dependents with health and other benefit plans at a cost affordable to both the public employers and the public employees beginning July 1, 2003." The new office was created because the cost of employer contributions was projected to grow to $949 million in 2013 compared to $266 million in 1998. As of July 2003 the state eliminated the option of having the employer contribution forwarded to an employee's union and enrolling in union plans.


  • 2012 Premium Rates:  Each of the state’s group medical and dental plans have been renewed with Blue Cross of Idaho with no premium rate changes for FY2012.
  • Idaho in 2006 enacted a mental health benefit specifically for state employees and their families. The link to the statute (ID Stat.: §67-5761A) [updated 6/10]
  • Idaho has a separate School District Council ( ) that contracts with Blue Cross to make available to each of Idaho’s 152 school districts and charter schools a custom tailored health insurance plan.  While Blue Cross is the a single provider, each district still has an individual plan and there is no pooling of  employees.   124 districts participate. None of the districts participate in the state of Idaho employee group insurance plan that has over 24,000 employees.

Iowa: As of July 1, 2009,  84 percent of the 28,522 state employees enrolled in health insurance through their jobs participated in plans for which they paid no premiums, according to the Iowa Department of Management. That number includes employees in all branches of state government. Iowa offers employees a variety of insurance plans. Generally, the 16 percent of state employees who pay part of their premium costs have chosen more comprehensive insurance, which covers more medical conditions, such as chronic illnesses, or pays a greater percentage of total claims. [Des Moines Register, 11/29/09]

Kansas: 2008 legislation (HB 2172) establishing a pilot project allowing certain small businesses to join the state employee health plan died in committee.

  •  Health assessment program focuses on state employees. All state workers will be able to volunteer for personal health-risk assessments. There will be a variety of assistance offered to those wanting to lose weight, stop smoking and find services for dealing with chronic disease or other problems. (9/07).

Maine: A 2007 law (HP 1093, signed 6/21/07) directs the State Employee Health Commission to evaluate the feasibility of the Legislature being an employer group in the Dirigo Health Program and to evaluate any effect on retirees who are Legislators. 

Maryland:  In April 2008, the state released "Measuring the Quality of Maryland HMOs and POS Plans, 2009" [2/10] which provides "validated results that compare the performance of the Maryland plans offered to State employees on measures important for ensuring high-quality care and services."

  • Maryland has authorized a new drug program to allow local government and businesses to buy in a pool with state employees.  As of early 2007, price negotiations await a contract ruling and have delayed the drug program.


  • Mass. Lawmakers Divided On Health Insurance Proposals - The House Speaker favors a plan to combine all cities and towns with state workers; unions and 50 legislators favor a version that would require cities and towns to continue to get union approval for changes in co-pays and deductibles.  4/21/11.
  • FY 2010 rates increase only 3.2%.  In the face of escalating health care costs and contracting state revenues, the Group Insurance Commission (GIC) initially was able to hold the line in its health plan rate increases for Fiscal Year 2010. At yesterday’s Commission meeting, the Commission approved 3.19% average rate increases across its fifteen employee and Medicare health plans for the upcoming fiscal year, which begins July 1. The GIC has consistently had more modest increases than other employers. For FY09, the GIC average rate increase was 6.37% and for FY08 it was 3.75%. [3/9/09 release]
  • For FY 2010, because of the state’s fiscal crisis, the legislature changed the premium contribution split. This was then signed into law by the Governor as part of the FY10 Appropriation Act, and the new contribution percentage split went into effect August 1, 2009. State employees who paid 20% of the basic life and health insurance premium (if they were hired after June 30, 2003) now pay 25%; those who paid 15% (if they were hired on or before June 30, 2003) now pay 20%.
  • A state budget analysis published March 2008 provided a 10-year history of state employee health spending.  It included the following figures, in 2007 state spending dollars (in millions): FY1987 = $464M; FY2006 = $1,012M; 10 year increase = $548M or 118%. The average annual change = +4.2%. "Point of Reckoning," 3/08.
  • In July 2007 the Legislature approved a plan, Chapter 67, the Municipal Partnership Act, to allow city and town employees to join in with the state employee program. 7/13/07.
  • MA: Cities, towns urged to join health plan; Statewide pool may save $100m.  Massachusetts cities and towns could save $100 million on the rapidly spiraling cost of health insurance in the fiscal year 2009 alone if they took advantage of a new law allowing them to join the state's health insurance program. According to the report, healthcare costs for municipal employees jumped 63 percent between fiscal year 2001 and 2005, while municipal budgets increased 15 percent. (Boston Globe, 8/20/07).

Michigan:  In July 2009 the House Speaker Dillon initiated a proposal to pool all state employees with city, town, county, district and K-12 school public employees.

Minnesota Governor Tim Pawlenty vetoed HF 1875 in 2008, which would have created a board to design a statewide health insurance pool for local school employees.  The initiative was designed, in part, to assist municipalities that do not currently provide coverage. (6/08)

Mississippi2010 "Healthy You!" Health/Wellness Initiative, administered by BC/BS of Mississippi.

Montana:  Montana's free health clinic for state employees sees early success | National Public Radio July 30, 2013

  • For 2011 Montana's state contribution, $733 per month in 2011, covered the cost of "core" medical, dental, and basic life insurance. Additional coverage was available for enrollees and eligible dependents.

North Carolina: State Health Plan members now have access to two online tools that empower users to monitor and compare average costs for physician office visits, diagnostic procedures and screenings, disease treatments, and prescription drugs. The updated tools are: Blue Cross Blue Shield of North Carolina’s (BCBSNC) Health Cost Estimator and Medco’s “My Rx Choices®,” listing prescriptions from a Preferred Drug List.

Ohio:  For 2010-11, full-time state employees pay a 15% share of the total costs of health coverage.


  • OK: Health care costs for public employees — the next big issue?  For decades, the troubling issue of rising public pension liabilities was perhaps the state's worst-kept financial secret.  Editorial by The Oklahoman (Oklahoma City, 8/12/2011)
  • The Oklahoma employee and teacher retirement system has become a federally qualified PDP (Medicare Prescription Drug Plan) in order to coordinate Rx services to its members while obtaining federal reimbursement for virtually all transactions.
  • In 2006 launched "OK Health wellness program," providing "All active state employees the opportunity to participate in the state's wellness mentoring program offered by the Employees Benefits Council State Wellness Program.  The goal of OK Health is to give you the right tools to help you feel better and improve your health."  Enrollment in the OK Health Program,  involves completing an online health risk assessment (HRA). An OK Health representative will call and arrange an initial visit with your Primary Care Physician for some basic measurements and labs.  They say, "As a program participant, the initial cost to visit your physician and receive lab work (specific to OK Health) will be waived by your health care provider.  Following your initial PCP visit, you will receive your first Orientation call from a professional health mentor."

Oregon:  For 2010 the entire Oregon plan will become self-insured.  More than 95 percent of all providers used by PEBB members are already in the network. [Bulletin -August 2009  | Self-Insured decision]

  • For 2009-2010 Oregon members in designated rural counties will get a "rural subsidy" and be responsible only for in-network coinsurance rates when they see providers who are not in the network.  Several special categories of residents are eligibile for state membership in PEBB, including  Blind Business Enterprise agents,  State-certified foster parents,  Oregon Liquor Control Commission agentsand Oregon State University and University of Oregon post doctorates and J1 Visa recipients.

Pennsylvania:  As of July 1, 2009, all enrollees and covered spouses that complete the 2009 Health Assessment saved ½ of the employee contribution or one percent of the gross base salary contribution. Based on an average salary of $46,000, an employee would see savings of $460 a year.

  • Pennsylvania added Adult Dependent Coverage for state employee families, effective January 1, 2010
  • For Pennsylvania, Senate members contribute 1 percent of salary toward health premiums; House members receive 100 percent coverage by the state.
  • Pennsylvania proposal seeks health insurance savings.  Hoping to save money for his state on health-care costs—and to hold down local property-tax rates used to pay for benefits—Pennsylvania Gov. Edward G. Rendell is proposing to bring all school employees under one insurance plan. Education Week 9/27/07. article.
  • Pennsylvania: has posted a detailed pharmaceutical Preferred Drug List for 2007 for all active state employees.  The system has been administered by ExpressScripts since 2004.  The program maintains a separate Prior Authorization list that allows use of some non-preferred drugs.

South Carolina:  Smokers face monthly surcharge; Tobacco users would start paying $25 in 2010.  Roughly 400,000 people are covered by the state plans, including 244,000 employees and their family members. The plans are available to teachers, state workers and local government employees, among others.

South Dakota:  The state has a carved-out Prescription Drug Plan, emphasizing mail order and administered by Prescription Solutions.  A mandatory generics policy took effect on July 1, 2004. If enrollees choose a name brand drug, and could use a generic, they will pay the generic copayment plus the difference in cost between the generic drug and the cost of the name brand drug.

Texas:  Texas law passed in 2005 allows for a Health Insurance Opt-Out Credit, which enables employees and retirees in the Texas Employees Group Benefits Program (GBP) to get money toward optional coverage if they give up their state-provided health insurance.

Utah: the Public Employee Health Plans (PEHP)  has published a price transparency online Treatment Cost Estimator

  • PEHP Children's Health, CHIP Master Policy - 2010
  • The Public Employees Health Program launched a "Utah Timely Topics" program, which promotes information on topics like Avian Flu, Prostate Cancer and Influenza.  They also publish a separate "Provider Bulletin."

Virginia: VA has a high deductible health plan for which the state pays the entire premium for the employee (all categories: individual, individual + one family member, & individual + two or more family members).

Washington:  Washington State Health Care Authority administers a Medicaition Therapy Management ( MTM) program for eligible enrollees of the Uniform Medical Plan (UMP) and the Aetna Public Employees Plan of Washington, paying pharmacists to find errors and dangerous interactions.

West Virginia: In 2004, West Virginia passed legislation (SB 143) intended to help uninsured small businesses provide coverage for their employees. The new law creates a private/public partnership between the West Virginia Public Employees Insurance Agency (PEIA) and insurance companies that choose to offer the plan. West Virginia's plan will allow carriers to access PEIA's reimbursement rates and drug purchasing plan, enabling the new small business coverage cost to be 20-25 percent below the usual market rate. This has expanded the pool of insured working West Virginia residents.

  • WV Public Employees Preferred Drug List, Approved as of 07/01/10.
  • WV Comprehensive Financial Report, FY 2009
  • West Virginia: also created the Pathways to Wellness program by law (W. Va. Code § 5-16-8). It requires the Public Employee Insurance Plan to provide wellness programs and activities which include benefit plan incentives to discourage tobacco, alcohol and chemical abuse and an educational program to encourage proper diet and exercise. The cost of the exercise program shall be paid by county boards of education, the public employees insurance agency, or participating employees, their spouses or dependents. All exercise programs shall be made available to all employees, their spouses or dependents and shall not be limited to employees of county boards of education.
  • West Virginia: Surgery abroad an option for 2007?  West Virginia, Republican legislator Ray Canterbury has proposed allowing state employees to go overseas for health care if they want, as long as the cost, including travel and accommodations, is less than the expense in the United States.  The bill is in a special study committee that will take it up next year.  Mr. Canterbury hopes that the state legislature will at least approve a pilot program testing overseas care.  (Post-Gazette, 9/10/06)
  • In December 2009 PEIA "due to escalating health care costs", approved changes for FY 2010-11 including a 4 percent premium increase for all active and retired employees. Additionally, changes affecting the benefit structure were approved, including expanded lifetime maximum benefit from $1 million to $1.5 million per member and an increase to the family out-of-pocket maximum to one and half times the single maximum. They also added a wellness program incentive that ensures members are aware of their modifiable risk factors, including blood pressure and cholesterol. For retired employees, the new plan includes an increase of $25 in their medical deductible and the implementation of the Express Scripts High Performance Formulary.

Wisconsin :   The state agency covers 550,000 people, including state and local government employees. For 2010, The core are 72,103 active employees (98.1% in HMOs) and 22,286 retirees (67.3% enrolled in HMOs).

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