PEIP changes aim to lower costs, provide stability

Per its website, “The Public Employees Insurance Program (PEIP) was created by special legislation to make a comprehensive package of medical, dental and life insurance benefits available to employees of Minnesota's cities, townships, counties, school districts and other units of local government. PEIP was designed exclusively to give public employees the comprehensive coverage they deserve; while giving public employers access to a high-quality benefits package that will attract and retain outstanding employees.”

The voluntary plan covers about 17,000 employees and affects 35,000 lives.

Effective May 7, 2024, a new law increases from two to four years the commitment groups in the program must make to participate in the pool. Participation will be automatically renewed for an additional four-year term — previous law was two years — unless a notice of withdrawal is provided.

The law also lowers the threshold for groups to exit the pool when premiums increase 20% or more from one insurance year to the next. Current law is 50%.

The changes are based off a Minnesota Management and Budget analysis of the pool structure compared to other states with similar insurance programs for public employees. The office administers the program.

Rep. Liz Olson (DFL-Duluth) and Sen. Erin Maye Quade (DFL-Apple Valley) are the sponsors.

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