The Connecticut Partnership Plan, a state-administered health insurance option for municipal and non-state public-sector employees, reported a substantial deficit in the last fiscal year after paying out significantly more in claims than it collected in premiums. Specifically, the program disbursed nearly $731.4 million in claims expenses for the 2024-25 fiscal year, ending June 30, which was approximately $22.6 million more than the premiums gathered from around 60,000 public-sector workers and their dependents.
This information comes from a recent detailed report published by Connecticut State Comptroller Sean Scanlon’s office. Despite the fiscal imbalance, Scanlon stresses that the Partnership Plan remains on sound financial footing. He points out that since modifications to premium calculations were established in 2019, the plan has generally operated without deficits.
"The Partnership Plan, like many healthcare programs across the country, faced significant challenges last year," Scanlon commented, highlighting the impact of rising hospital service fees and widespread medical inflation. These increases reflect continuing pressures from the healthcare industry, including hospitals’ efforts to raise employee wages to combat workforce shortages and other pandemic-related strains. Additionally, federal reimbursements through Medicaid and Medicare have not kept pace with the growing costs, according to insights from the American Hospital Association.
Moreover, the pandemic has led to an increase in patient volumes coupled with more complex health conditions presenting at healthcare facilities, further exacerbating financial strain on insurers like the Partnership Plan.
The plan was designed to provide an alternative health coverage option to municipal employees who might otherwise rely solely on their local government or regional plans. Established by legislative vote in 2015, it now serves workers from 109 out of Connecticut’s 169 municipalities either fully or partially.
Since its inception, financial balance has been an ongoing concern. In its first two fiscal years, the Partnership Plan experienced a claims deficit of $31 million. This prompted the legislature to revise premium-setting methods, which resulted in increased fees for many enrollees to stabilize the program’s finances.
The program's funding also benefited from a one-time transfer of nearly $40 million from a federal COVID-19 relief grant to bolster its reserves. This intervention was aimed at preserving the plan’s fiscal health during uncertain times.
However, these recent negative results have drawn criticism from minority Republicans in the Connecticut General Assembly. Sen. Tony Hwang and Senate Minority Leader Stephen Harding voiced concerns, stating in a joint release that the Partnership Plan’s financial challenges could signal moves toward broader state-provided, single-payer healthcare coverage. They questioned if the state might further intervene in public health insurance offerings instead of allowing private insurers to serve public-sector workers.
Comptroller Scanlon addressed these assertions by dismissing them as political rhetoric tied to the upcoming 2026 campaign season. He regards last year’s financial performance as consistent with broader trends affecting all healthcare plans and not indicative of systemic collapse.
He also emphasized that since the premium reforms in 2019, the Partnership Plan has exceeded claim payments with premium collections in four of the past six years, acknowledging that periodic deficits are not unusual in insurance plan financial cycles.
In response to rising healthcare costs, Scanlon’s office is actively pursuing cost-saving measures. Efforts include negotiating savings by encouraging the use of generic medications wherever possible to reduce prescription expenses. This reflects a commitment to managing expenses proactively rather than acquiescing to unavoidable increases in healthcare costs.
He cautioned, however, that ongoing federal healthcare funding cuts could compound challenges ahead, potentially limiting Americans’ access to primary care and further increasing strain on insurance programs. Despite these concerns, the Connecticut Partnership Plan aims to maintain sustainable operations through careful administrative oversight and policy adjustments.