The State Employee Benefits Committee (SEBC) reports there is currently a $15 million deficit in state health insurance funding for this fiscal year.
Delaware spends an average of $1.2 billion on the Group Health Insurance Plan (GHIP) to provide healthcare to active state employees, their spouses and dependents, retirees pre-Medicare and state pensioners.
Before the COVID-19 pandemic, Department of Human Resources Secretary Claire DeMatteis says the department saw much larger deficits than the current $15 million, but after the pandemic curtailed health care visits - they have increased over the past year.
“During the COVID years, we just did not see people going into the hospitals and getting procedures. We did not have to raise rates because we were running a really significant surplus in the Group Health Insurance Trust Fund," DeMatteis said.
She requested an increase in GHIP funding for fiscal year 2025, but the $15 million must be paid off by June 30, 2024.
At their November meeting, the SEBC noted weight loss medication coverage as a large contributing factor to the deficit.
DeMatteis says last fall, Delaware joined several states and Medicaid in deciding to cover weight loss drugs, but there have been more prescriptions than expected.
“The projections from our pharmacy benefit manager was that we would likely spend about just shy of $2 million, and instead, it’s well over $7 million," she said.
During the meeting, concerns were raised that anyone who wanted access to weight loss medications could receive a prescription, but DeMatteis explains several conditions need to be met.
The largest factor is a patient must be diagnosed with comorbidity, meaning they must have two chronic diseases, as well as show proof of a diet plan and exercise regime before being considered for a prescription.
DeMatteis says there’s always a chance the funding could level out if fewer state employees utilize their health insurance over the next few months, or an additional appropriation from the General Assembly may be needed to cover the deficit.
She says raising premium rates for state employees would be a last resort, and the committee will continue to monitor spending over the next seven months.
