Montclair Considers Insurance Switch Amid Spike In NJ Health Costs

MONTCLAIR, NJ — As health insurance costs spike for governments across New Jersey taking part in the state’s health benefit plan, Montclair officials are pondering a switch to the town’s own plan for municipal workers.

On Tuesday evening, Thomas Ucko, a representative with Belleville-based IMAC Insurance Agency gave a presentation to the Montclair Town Council (watch the video below). The presentation was for informative purposes and no council vote was taken.

Ucko said IMAC took a look at the state health benefit plan versus the commercial insurance market to see which might be more cost efficient for Montclair, which saw a 20.5 percent rate increase this year. The most favorable proposal came from a sub-fund of the Gateway BMED Health Insurance Fund, which would offer a 4.8 percent gross savings versus the 2023 rate of the state plan, which translates to about $460,000 over 12 months.

Ucko said the change would result in insurance coverage that is “equal to or better than” the plan township workers currently have, as required by union contracts.

After the presentation, Mayor Sean Spiller said the township has switched its health insurance providers multiple times in the past, and has seen savings over the years by doing so.

“I think everyone’s seen in the press where we’ve seen some spikes in some of these costs,” Spiller said.

Based on a vote by the State Health Benefits Commission in September 2022, a wave of municipal governments in New Jersey are seeing double-digit increases for their health insurance this year.

The rate increases have riled up several local elected officials in Essex County. In October, elected officials from Maplewood joined their peers at a rally in South Orange, uniting alongside union members, employees and school officials to decry the situation.

In a joint statement, South Orange and Maplewood leaders blasted the rate hikes, calling them “unprecedented, unexpected and irresponsible.” Read More: Rallies, Outrage In Essex County Over NJ Health Care Hikes

At Tuesday evening’s meeting, Ucko pointed out some local governments and boards of education have departed the state health plan amid the rising costs, including Newark, the state’s largest city.

After the commission’s vote last year, Newark Mayor Ras Baraka said the city faced “astronomical” health insurance rate hikes for its city employees – which would have ended up getting passed on to local taxpayers. Newark officials recently announced that the city is dropping the state health benefits plan and going with a private insurer, Aetna.

Read More: Newark Faces 'Astronomical' Health Insurance Hikes For City Workers

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