Changes to Louisiana State Health Insurance Program to Be Delayed

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Gov. Bobby Jindal’s administration announced that it was delaying heavily criticized changes to the state health insurance program by two months, but not backing off the rewrite to benefits.

Most changes to the insurance offered through the Office of Group Benefits will begin on March 1, instead of Jan. 1. Also, members of the health insurance program will have an extra month to make decisions about what benefit plan they’ll select.

The enrollment period starts Wednesday and now will extend until Nov. 30.

Retirees and employees who face the higher deductibles and out-of-pocket costs have responded angrily to the changes.

Announcement of the delay comes after a contentious legislative hearing packed with people who said they will be harmed by the insurance plan rewrite. State lawmakers urged the Jindal administration to consider adjustments to the timeline for rolling out the benefit changes and possibly tweaks to the benefit plans themselves.

Commissioner of Administration Kristy Nichols said she wanted to give workers and retirees more time to research the available insurance plans that are replacing all existing benefit plans.

“Obviously, we were very sensitive to the testimony that was provided at the hearing,” Nichols said. “We wanted to make sure that people have every chance that they can so that they can make good decisions.”

The Office of Group Benefits provides health insurance coverage to 230,000 state workers, public school employees, judges, retirees and their dependents. Nichols said the changes are needed because medical inflation and the federal health overhaul are driving up insurance costs. Critics accuse the Jindal administration of program mismanagement.

Nichols said the delay will cost the insurance program as much as $20 million. She said the program couldn’t afford to stall the start of the changes any later than March 1.

But retirees and workers who say they will be paying more and getting less want the changes reconsidered entirely. While the changes will go through a formal process of legislative review and public comment, Nichols said she didn’t expect to tweak much of the insurance benefit redesign.

“We don’t anticipate making changes, certainly not large-scale changes,” she said.

None of the 2015 health insurance plans will be exactly the same, so workers and retirees will need to choose new insurance options in October or November or they could be placed in a default plan that has high out-of-pocket costs and smaller benefits.

Retirees who don’t enroll in a new plan will be placed into a “comparable option,” rather than the default plan that other workers would get, according to the changes announced.