New Jersey's school employee health plan could be unavailable to districts starting Jan. 1, 2027, unless a state commission approves a 34.4% premium increase at its Monday vote. It covers 53,500 active school employees and roughly 114,000 retirees and their families.
The School Employees' Health Benefits Commission has failed three times in recent months to set rates, either in 4-4 ties or by postponing votes; a ninth seat that could break a tie has been vacant for years. The Division of Pensions and Benefits said rates and individual cost estimates would not be ready for the Oct. 1 open-enrollment start. If the commission approves rates Monday, the division says it will set new enrollment dates.
Under a 2020 law limiting premium increases for school employees, districts would absorb most of the proposed hike, which could mean cuts or higher property taxes where they cannot pay. The NJEA called the state memo a “threat,” while the School Boards Association said some districts are considering other coverage. Officials have warned of a possible “death spiral”: active enrollment fell 11% in fiscal 2025 as districts left for cheaper plans. The actuary projected reserves would fall to negative $42 million by the end of 2025, and the plan must repay a loan expected to top $70 million.
