Unionized government workers in the Mid-Atlantic region contribute a much smaller portion toward the cost of their health care than do private workers and pay less even than any other public employees in the country, analysis of federal data shows.
Bureau of Labor Statistics figures reflecting costs as of March 2010, the most recent available, show public workers in Northeastern states including New Jersey but not including the New England region contribute 10 percent of the cost of their health-plan premiums for family coverage and 8 percent of the premium cost for individual health plans.
That is less than half the percentage typically paid by private industry workers in the region, who pay about 27 percent for family coverage and 18 percent for single coverage.
The numbers show the gap between public and private workers' contributions during a time when the disparity has fueled a statewide battle in New Jersey over changes to public health benefits. The issue of whether state workers should pay more of the cost of the benefits is a major issue as the Legislature works to pass a state budget.
Top state lawmakers from both parties have called for reform of the health-benefits system, which both sides say has a massive $67 billion in current liabilities.
As Republican Gov. Chris Christie said during a town hall meeting recently in Hammonton, that deficit makes the $54 billion indebted state pension system "look healthy."
In response, Christie has proposed making all state and public employees phase in to pay 30 percent of their premiums by 2014. He also promises to pay into pensions and increase property-tax relief credits if that legislation gets passed.
New Jersey Senate President Steve Sweeney, D-Salem, Gloucester, Cumberland, has been citing similar statistics as he presses for reform of the benefits contributions formula.
The trend shows public unions in this geographic region have negotiated lower contributions than public workers employed elsewhere. Not only do public workers contribute less than their private-industry counterparts, but Mid-Atlantic public workers also pay a lower percentage of their health premiums than other public-sector workers in other parts of the country.
In Arizona and other surrounding states, for example, public workers may contribute as much as 45 percent for a family health plan, the BLS data show, more than four times as much as those in Northeastern states contribute.
Union officials say singling out those numbers risks painting a skewed picture that doesn't take into account public workers' lower salaries compared with those of private workers' salaries. They also say legislation is inappropriate for an issue that has been traditionally bargained collectively in union contracts.
Steve Baker, a spokesman for the New Jersey Education Association, said that the debate would not give the whole picture of benefits received by public workers.
"These benefits have always been part of a package, a package set through collective bargaining," he said. "If you single out one part of the package, you won't understand the context. Maybe workers gave up raises, or took smaller raises."
The details of the back-and-forth of contract negotiations are mostly kept confidential, he said, meaning those concessions were often "not acknowledged."
Looking at health benefits alone, he said, made little sense without similarly comparing private and public salaries - taking into account the education and an employee's years of service.
Public workers also do without other incentives, he said.
"Bonuses are something that private workers often receive - but they're not mostly given in the public sector," Baker added.
However, he pointed to the geographic difference, and argued that more expensive health plans in Northeastern states may mean unions contribute less of a percentage while employers pick up more, but workers are still paying significant chunks of their salary.
Michael Drewniak, a spokesman for Christie, said Monday that geographic variables would not sway the administration in its call for quick reform.
"Call me parochial if you like, but we're really concerned about New Jersey and what's best for New Jersey taxpayers," Drewniak said.
However, of the disparity in contributions, he said: "That's unsustainable."
Sweeney has proposed making employees pay on a sliding scale tied to salary, so that within seven years the highest earners would pay 30 percent, while the lowest earners would pay 12 percent. He argued last week that legislating the change would provide stability and bring public-sector unions closer to the private-sector unions whose health benefits are set by labor boards, not through contract negotiation.
Making the shift would not only close the gap between private and public workers, but would mean it couldn't reopen in the future.
"I'm in a private-sector union," Sweeney said in an interview.
Representing ironworkers, whose health care is set by the labor board, not through bargaining, he said, "We manage our health care. And we don't have a $100 million problem, because we manage it."
He said every public employee costs $20,000 to the state in health benefits alone.
Democrats have argued in support of Sweeney's plan that the typical cost for a health care plan is high in this region, but that even by those standards the state plan is expensive.
Research indicates a public-sector family plan is generally worth $19,000, Democrats say, while they cite a Kaiser/HRET survey of health care costs to estimate a private-sector worker's plan between $8,000 and $10,000.
While the average worker nationwide pays roughly $4,000 a year toward premiums, a public employee making $60,000 a year in New Jersey is paying only $900 a year for family coverage.
Michael Egenton, senior vice president for the New Jersey Chamber of Commerce, welcomed the figures that gave a sense of the actual cost of health care for businesses. He said those figures bear out what he hears from private companies all the time.
"We frankly hear about this all the time from private businesses," Egenton said. "Private companies feel like providing benefits for an employee - that's like hiring a second employee, right there."
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