After months of tough bargaining with the State of New Jersey, we are proud to announce that our union has reached an agreement on the State Health Benefit Plan that protects our access to quality, affordable healthcare while pushing back against a potential double-digit increase to our contributions and $100 million in cost-shifting that had been mandated by the State budget.

Why This Matters

The State Health Benefits Plan premiums were projected to rise over 17% in 2026, which would cause a double-digit increase in our paycheck contributions. Our state executive branch contracts require bargaining to try to minimize this increase. CWA partnered with all other executive branch unions to jointly negotiate against these premium hikes.
Also, the State’s budget included a mandate for $100 million in healthcare “savings” in the first half of 2026. Too often, those “savings” come straight out of workers’ pockets in the form of worse benefits, much higher copays, and deductibles. In fact, the State proposed changes to our plans that would have shifted thousands of dollars onto members. We went to the table determined to prevent that. The agreement we won ensures healthcare costs are reduced without putting the entire burden on you and your family by getting the State to agree to actual cost-saving measures that will help reduce further unnecessary increases in healthcare costs.

Key Wins for Members

• Protected current copays for Primary Care, Specialist and Urgent Care office visits
• Zero increase to member contributions for 2026
• Budget Resolution Reversed: The Legislature will be asked by the Governor to rescind the budget language that triggered this fight. That ensures negotiated agreements, not political mandates, govern your healthcare.
• Union Seat at the Table: A joint working group, with union representatives included, will create a roadmap for the next Administration and Legislature to tackle the real driver of rising costs: healthcare provider prices and lack of oversight in the system.
• Minimized impact to out of pocket costs: While the MOA adjusts certain copays and out of pocket expenses, they are contained to a fraction of what the State was seeking through legislative mandates.
• Vendor Report by October 2025: An independent review will expand claims audits,
  identifying and recovering provider overpayments to save money for the plan without cutting benefits.
• Pharmacy Costs Cut: The State will use a reverse auction to secure a pharmacy benefit manager (PBM) contract, projected to save hundreds of millions of dollars.
  Responsible Use of GLP-1 Medications: Members prescribed GLP-1s for weight loss will have access to counseling support, improving outcomes and controlling costs so the plan remains sustainable.
• Protecting In-Network Strength: Design changes will encourage use of the plan’s
  excellent, extensive in-network providers, preventing unnecessary out-of-network costs.
• Lower-Cost Surgery Options: The plan will steer appropriate procedures like carpal
  tunnel surgery, colonoscopies, and arthroscopies to high-quality ambulatory surgery centers, saving money while keeping quality of care high.

When will this go into effect?

Most changes (with a notable exception being GLP-1 Weight Loss co-pays) will not go into effect until 2026. Members will have suitable time to learn about the changes and how they will affect them before and during the open enrollment period, and members will have the opportunity to speak with their CWA Healthcare Ombudsperson with any questions they have about plan changes.

What’s Next

This is not the end of our fight—it’s a step forward. The agreement requires continued oversight, innovation, and accountability from the State. Whether we win stronger governance and cost-reductions through bargaining, legislation or joint efforts with the State, we will keep fighting for high-quality, affordable healthcare. Your union will remain vigilant and engaged at every stage to make sure these commitments translate into real savings for the plan, not cost-shifting onto members. We reached this outcome because of the strength and solidarity of our members. By standing together, we forced the State to work with us in addressing the rising costs of healthcare.

Public Sector Healthcare Affordability and Responsible Governance Act (A5903)

Click here for a PDF version of this fact sheet. 

New Jersey’s public sector workers in State and Local Governments deserve access to affordable, high-quality healthcare. Just after the latest state budget cut $200 million from healthcare benefits for the 2026 plan year, the actuary for the State Health Benefits Program Commission (SHBP) proposed rate increases of 37% for local government workers and 19.7% for state government workers. 

These rate increases are another devastating blow to the health benefits plan covering 450,000 active and retired public servants. For example, a local government worker earning $50,000 a year with family coverage will contribute over $8,300 or 17% of their pay for benefits. A5903 will tackle this problem by addressing healthcare affordability, cost control, and governance & transparency.

Cost Control

Healthcare costs are skyrocketing, enriching hospital CEOs and health insurance companies at the expense of working people. The bill helps control costs by:

• Expanding an existing claims review program, which has already resulted in hundreds of millions of dollars of savings
• Putting guardrails on the use of GLP-1s, high-cost weight loss drugs that are driving up costs, while ensuring that employees and their dependents continue to have access to prescription drugs that are medically necessary. 
• Requiring more frequent review and approval of new FDA-approved drugs to market, and controlling some of the highest-priced medications

Affordability

As a result of high costs, premiums, and out-of-pocket costs are increasingly unaffordable for State and Local Government workers. If the State adopts the latest proposal, local government workers are facing a 112% compounded increase in premiums, and state workers are facing a 69% compounded increase since 2021. This is unsustainable – and unacceptable. This bill will ensure affordability for Local Government employees and Local Governments by: 

• Requiring the SHBP to offer 5 high-quality plans and, for 2 of those plans, base contribution rates on a percentage of salary rather than premiums
• For local governments outside of the SHBP, this bill triggers collective bargaining if the privately managed plan costs are higher than the SHBP

Governance & Transparency

For years, the State Health Benefits Plan (SHBP) has been mismanaged and is now on the brink of collapse. In order to ensure effective administration and management of the plan, the bill will reform the governance structure by: 

• Expanding the State Health Benefits Commission to ensure equal representation for employees and employers and making sure all key stakeholders are at the table, including representatives from the League of Municipalities and the Association of Counties.
• Merging the powers of the Commission and the Plan Design Committee to make the governance of the SHBP more efficient 
• Requiring transparency of insurance prices, performance of the insurance carriers and pharmacy benefit managers, and public contracting

We all remember what happened in 2022 — a 20% increase in premiums that blindsided state workers with no warning, no transparency, and no accountability. We fought it then, we’ve been fighting it ever since, and unfortunately, we are back in that fight today — because once again, state workers are being forced to carry the cost of decisions we had no hand in making.
Here’s what’s happening right now:
Last week, the State Health Benefits Commission released a proposal for a 19.7% increase in state worker healthcare premiums.
At the same time, the Governor and Legislature passed a budget that includes $100 million in cuts to the SHBP — not real savings, but a budget gimmick that they will almost certainly try to make us bear the brunt of through increased costs or cuts to our care.
This wasn’t a mistake. This was a demand made in a backroom by Governor Murphy, and once again, state workers are being treated like a line item instead of the people who keep New Jersey running.
Let me be clear: this is a crisis, and CWA is not standing by. We’ve spent the past several months organizing and mobilizing, speaking with legislators, and building a broad coalition with a dozen other public worker unions to demand a solution to these unsustainable healthcare cost increases. And while the Governor has refused to negotiate or include us in the process, we have legislative allies who are standing with us, and a plan to fix this.
If you missed last night’s discussion and presentation, click here to watch the recording.
The only thing that changes the outcome is collective action. We’ve done it before — and we’ll do it again.

-Billy Gallagher, Assistant to the Vice President, CWA District 1

Upcoming Actions & Meetings

We’ll need big turnout for these! Reach out to your CWA Local for more details and how to attend
• Thursday, July 24 – Committee Hearing in the Assembly on our healthcare bill, A5903
• Monday, July 28 – State Health Benefits Plan (SHBP) Meeting