GIC needs $120m more to cover shortfall

Could accentuate state budget problem

STATE HOUSE NEWS SERVICE

The state commission that oversees public employee health insurance coverage will likely need at least $120 million in additional funding this fiscal year, a request that would contribute to ongoing state budget problems.

“It’s probably going to be north of $120 million,” Group Insurance Commission (GIC) Executive Director Dolores Mitchell told the News Service after a meeting on Friday morning.

While GIC underfunding was not flagged by state budget writers when they agreed on a $36.5 billion budget in July, Mitchell on Friday said, “Everybody knows that we had an appropriation amount that was lower than what we predicted we’d be spending.”

Mitchell said annual state budget funding has not caught up with the influx of new members. The GIC is still adding members from the MBTA, and a 2011 state law eased the ability of municipalities to join the state health plan. Mitchell also said a federal fund the GIC used to pay claims has dried up.

“In most cases it is not over-spending. We have one outlier plan that we’re having conversations with that appears to be not controlling their spending as rigorously as we would like,” said Mitchell, who declined to name the plan.

The Massachusetts Taxpayers Foundation this week predicted $100 million in needed GIC spending as part of its estimated $1 billion budget deficit. Administration and Finance Secretary Glen Shor has disputed portions of the MTF analysis and maintains the budget shortfall is about $330 million.

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Andy Metzger

Reporter, CommonWealth magazine

About Andy Metzger

Andy Metzger joined CommonWealth Magazine as a reporter in January 2019. He has covered news in Massachusetts since 2007. For more than six years starting in May 2012 he wrote about state politics and government for the State House News Service.  At the News Service, he followed three criminal trials from opening statements to verdicts, tracked bills through the flumes and eddies of the Legislature, and sounded out the governor’s point of view on a host of issues – from the proposed Olympics bid to federal politics.

Before that, Metzger worked at the Chelmsford Independent, The Arlington Advocate, the Somerville Journal and the Cambridge Chronicle, weekly community newspapers that cover an array of local topics. Metzger graduated from UMass Boston in 2006. In addition to his written journalism, Metzger produced a work of illustrated journalism about Gov. Charlie Baker’s record regarding the MBTA. He lives in Somerville and commutes mainly by bicycle.

About Andy Metzger

Andy Metzger joined CommonWealth Magazine as a reporter in January 2019. He has covered news in Massachusetts since 2007. For more than six years starting in May 2012 he wrote about state politics and government for the State House News Service.  At the News Service, he followed three criminal trials from opening statements to verdicts, tracked bills through the flumes and eddies of the Legislature, and sounded out the governor’s point of view on a host of issues – from the proposed Olympics bid to federal politics.

Before that, Metzger worked at the Chelmsford Independent, The Arlington Advocate, the Somerville Journal and the Cambridge Chronicle, weekly community newspapers that cover an array of local topics. Metzger graduated from UMass Boston in 2006. In addition to his written journalism, Metzger produced a work of illustrated journalism about Gov. Charlie Baker’s record regarding the MBTA. He lives in Somerville and commutes mainly by bicycle.

The GIC received $1.9 billion in the current fiscal 2015 state budget and covers more than 420,000 people, according to its website. In fiscal 2014, the Legislature provided the GIC an additional $16 million in March and another $50 million in May.

Also in March, the GIC voted for an overall 1 percent premium increase in its plans for fiscal 2015, describing it as the lowest increase in more than ten years.