Thousands of Yukoners have sticker shock over a 52.8-per-cent increase in their extended health care premiums – news that arrived late last week with no warning or explanation.

Yukon government employees, teachers, and even cabinet and caucus employees are affected, both current and retired.

Canada Life is the provider involved.

On Monday, Finance Minister Sandy Silver laid the blame on a joint management committee, which has employer and employee representatives administer group insurance plans for the government.

He said the increase is “not unique to the Yukon” because of inflation and more claims being filed.

“The government pays 85 per cent of the premium (for employees), so (the increased costs) are not lost on us,” Silver told MLAs Monday.

“It’s not up to the minister to negotiate. We have one of the best plans in the country. The rates are going up anywhere from $15 to $50.”

Last week, the Public Service Commission (PSC) sent out emails and letters to current and retired employees advising that, as of April 1, extended health care premiums will increase by 52.8 per cent.

Retired clients have until March 25 to decide if they want to cancel or not; current employees are required to have extended health benefits.

YG itself will be on the hook for an additional $7.6 million this year.

Exceptionally high costs in 2023-24

No explanation was provided in that letter for the increase.

In a separate email from the PSC, Michelle King, the director of compensation and benefit programs, said Monday the increase is due to:

• Rates set too low for the 2023-24 coverage;

• Increase in overall usage (e.g. high-cost specialty drugs);

• Plan design changes in 2023 that had higher-than-predicted costs for vision and hearing aids;

• Inflation; and

• Increase in costs for services (e.g. paramedical practitioner fees).

“Claims for the current benefit year have been exceptionally high and exceeded the premiums …. We are aware that this increase will impact retirees who are on a fixed income,” King said.

“Switching to a different carrier (than Canada Life) would not have an impact on the premium rates set for April 1, 2024.”

Justin Lemphers, the president of the Yukon Employees’ Union (YEU), said his union was surprised by the PSC’s announcement – especially since the YEU representative on the joint management committee was not at the Feb. 29 meeting that approved the change recommended by Mercer, a national benefits consulting firm.

“Many members have expressed sticker shock at the substantial increase in their premiums,” Lemphers said.

“We have heard from several YG retirees since this was announced, and they are very critical of the short notice they have been given to decide if they can afford to remain in the plan.”

Lemphers says the Public Service Group Insurance Benefit Plan Act does, in fact, give the Finance minister decision-making power, despite Silver’s claim to the contrary.

“We ask if minister Silver or the Yukon government can reduce the impact on retired and current members,” Lemphers said.

“Based on previous reporting to the committee, could they have been more proactive and better positioned to blunt the pain of this increase?”

Increases ‘distressing, shocking’

On Monday, Yukon Party MLA Yvonne Clarke wanted to know why the PSC waited until the last minute to inform staff about the dramatic increase.

“Even the pension administrators who are tasked with responding to the dozens of concerned emails from current and former employees have acknowledged this increase is dramatic,” she said.

“Some have called the increases distressing and shocking, and judging from the many emails (the Yukon Party) has received, I think that those statements are accurate.”

Silver – who is also the minister responsible for the PSC – said the responsibility lies with the joint management committee.

“These (extended health) benefits are crucial for peace of mind and quality of life,” he noted in a statement Tueday morning.

NDP Leader Kate White also has questions about the “sudden, massive bump” in premiums.

“We know premiums are adjusted every year, and that single-digit increases have been the norm.

“What happened last year to justify a 52.8-per-cent bump on such short notice?” White asked.

She noted that it’s “especially concerning” that retired government employees are not represented on the joint management committee that decides what benefits to provide and how to pay for them.

“That’s a problem because retirees don’t have an employer to offset rising premiums the way that working Yukon government employees do.”

One retired employee, paying for a “Single RHS100” plan, will have a $60.35 increase come April 1.

Another, paying for a “Family RHF85” plan, will have a $89.95 increase.

Premium rate changes over the past five years for Yukon government staff and retirees were: eight per cent increase (April 2023), eight per cent decrease (April 2022), no change (April 2021), 7.1 per cent increase (April 2020), and a two per cent increase (April 2019).