The Recent Government Employee Healthcare Protests Explained: NJ Taxpayers Will Lose Again

Given the protests in Trenton and the loud public outcry, Sunlight will weigh in on the health benefit premium hikes for New Jersey government employees, if only to clarify matters for our readers.

There was a protest yesterday by state and municipal employees about the 20% rate hikes for their health insurance benefits.  It was then announced that Governor Murphy – always on the side of his government union benefactors – had cut a deal that greatly reduced the increase to a mere 3%, well below the 8%-level of inflation.  But this was only for state employees because they collectively bargain with the state.

Municipal workers collectively bargain with municipalities, and they have their own, separate contracts.  There’s no doubt that Murphy could cut a deal for them as well – there are lots of federal pandemic relief dollars available – but these local unions aren’t the mega-Murphy donors that the state-level unions are.  We will see what happens here.

What Sunlight readers should understand is that inflation is driving all prices up, including prices for health care.  Given this increase in the cost of healthcare, any reduction in the amount paid by government employees perforce means that New Jersey taxpayers will pick up the tab – either at the local or state level, or both.  

Where is the state’s largest government union, the NJEA, in all of this?  Well, there’s a reason they were not at the Trenton protest and a reason why they aren’t cashing in their chits with their pal, Murphy: the 2020 deal cut by then-Senate President Sweeney and the NJEA changed the structure of the (separate) healthcare plan for teachers.  Instead of paying a percentage of the premium, teachers only have to pay a percentage of their salaries towards their premiums. So, by design, teachers will be insulated from the increased premium costs, which will almost entirely be passed on to local property taxpayers.  

The bottom line is that it was already clear that the 2020 Sweeney-NJEA deal has cost local property taxpayers more than advertised, and this recent inflationary boost to healthcare premiums will cost them even more. Sunlight wonders how Murphy’s highly touted temporary property tax rebates will compare to this permanent increase in their property taxes.

Once again, the politically connected special interests win and New Jersey taxpayers lose.