Union Agreement Negotiates Health Plan Cost Increases for State Employees

The State of Montana Benefit Plan is facing rising medical and prescription drug costs, with the state's self-funded plan expected to see nearly double-digit health care cost growth in 2027 due to inflation. The plan's reserve level is projected to fall below a key financial threshold by the end of 2026. Under a new bargaining agreement with the Montana Federation of Public Employees, public employee unions secured lower costs than the state’s earlier 2027 plan notice. The agreement sets the 2027 individual deductible at $2,000 per individual, down from the earlier notice of $3,000.

The rising costs and the potential reserve level issues force the state to consider adjusting employee contributions, deductibles, copays, and out-of-pocket maximums. The new agreement sets the medical out-of-pocket maximum at $6,500 per person and $13,000 per family.