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LSO outlines state benefits costs: health insurance, PERSI and the role of CEC in compensation
Summary
LSO analysts told JFAC benefits account for about a quarter of personnel costs, health insurance is the largest component, and the Change in Employee Compensation (CEC) process guides salary and benefit changes that feed into program-maintenance budgets.
Frances Lippitt, budget and policy analyst with the Legislative Services Office, summarized how employee benefits fit into Idahos state budget.
Lippitt said benefits currently account for about 26.6% of personnel-cost expenditures and that health insurance comprises nearly half of benefits spending. She explained that variable benefits (employer pension contributions to PERSI, Social Security and Medicare, life insurance, workers' compensation and fees) are budgeted as a percentage of salary; combined, variable benefits are budgeted at roughly 23% of salary for FY2025.
On health insurance budgeting, Lippitt described the per-full-time-position appropriation mechanics that include the premium, a sweep for employees who decline enrollment, and the plan reserve. She explained the statutory or contractual minimum reserve target of 10% of expected premiums and that the governor's recommendation for fiscal 2026 would appropriate a higher per-FTP amount ($14,300) than the strict 10% reserve calculation (about $13,960) to cover plan costs more conservatively; the higher appropriation was estimated to cost about $56.6 million.
Lippitt also summarized current PERSI employer contribution rates in effect for FY2024: 11.96% for general members, 14.65% for public-safety employees and 13.47% for teachers. She said employer contributions totaled about $141.5 million in FY2024.
Ending: Lippitt said the Change in Employee Compensation committee evaluates benefit and compensation recommendations and will report to JFAC; the committee will consider trade-offs among market adjustments, merit, pay-line exceptions and benefit funding as part of program-maintenance deliberations.
