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Alabama state employee insurance board to seek more funding, benefit changes

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alabamareflector.com – Anna Barrett – 2025-09-05 07:01:00


Stephanie Azar, CEO of Alabama’s State Employees Insurance Board (SEIB), warned that rising healthcare costs could push SEIB into debt within three years without increased state funding or benefit changes. To address shortfalls, Azar recommended withdrawing the maximum allowable $30.4 million from the Retirees’ Trust Fund and suggested further withdrawals if necessary. The executive committee approved proposed benefit adjustments, including higher deductibles and copays for hospital stays, emergency rooms, and specialist visits, aiming to save up to $6.2 million annually. Azar also recommended increasing monthly premiums from $1,025 to $1,175 per full-time employee, pending legislative approval.

by Anna Barrett, Alabama Reflector
September 5, 2025

In the face of rising insurance rates, Alabama will have to consider allocating more money to the state employees’ health insurance program while altering state workers’ benefits, the State Employees’ Insurance Board leader said during a meeting Wednesday.

Stephanie Azar, CEO of the board, told members of the executive committee that without increased state support or benefit changes, the SEIB would gradually go into debt over the next three years.

“The board has known for some time that there would be difficult decisions coming due to the health care inflation and the issues we may face,” Azar said. “I will say that any changes or any decisions that will be made should not occur at one time, or even in one year, but will require the board to remain open to the pathway over the next several years to ensure the plan remains financially strong while maintaining excellent benefits for the members.”

Azar also recommended the board authorize a withdrawal from the Retirees’ Trust Fund to address funding shortfalls in the coming months. Withdrawals are limited to 10% of the trust’s fair market value on the last day of the previous fiscal year, Azar said, which was $304.7 million. She recommended pulling the maximum amount allowed, $30.4 million.

“I think that is not a good practice to pull from the trust, but I think that this board is going to have to pull from the trust,” Alabama Finance Director Bill Poole said.

Azar said the last time money was taken from the trust was in fiscal years 2015 and 2016, also to address funding shortfalls. She also recommended that the board withdraw 5% of the trust at the end of FY26 if needed.

Although the $30.4 million will help, Azar said the $30.4 million will only pay for about three weeks of expenses. 

“This was enlightening to me when I heard this, but SEIB spends a little over $10 million in a week,” Azar said.

The executive committee approved benefit changes to bring before the full board for a vote, including:

  • Major medical calendar year deductible (from $300 to $350)
  • Inpatient hospital stays (from $250 to $300 deductible, and from $25 to $50 copay)
  • Emergency room visits (from no copay to $250 copay excluding accidents and $300 copay including accidents)
  • Specialist and ER physician visits (from $35 copay to $40) 

Azar said the changes would save SEIB up to $6.2 million per year.

Connie Grier, an elected active employee representative, convinced the executive committee to reduce Azar’s initial recommendation for an increased specialist copay of $50 down to $40.

“I feel like $50 for a specialist is going to discourage some people from going to a specialist,” Grier said. “There are a whole lot of specialists. I think people are actually seeing more specialists now than what we used to 10 years ago.”

Azar said that benefit change was the biggest driver of savings in its original form at about $3.7 million per year. 

“It is still a very rich benefit program, even with benefit changes,” Azar said.

She also recommended increasing the per member per month rate from $1,025 to $1,175 for full-time employees, which the board will request from the Legislature when the 2026 legislative session begins in January. Azar said about 30% of the coverage is paid for by the state, $6% is from the employer, and 28% falls to the employee. The final funding decision will lay with legislators. 

Earlier Wednesday, the Public Education Employees Health Insurance Plan board approved a rate increase request.

“The point is: health care costs are going up everywhere,” Poole said.

Faye Nelson, who chairs SEIB, said she would support the changes the board sought, but that there would have to be changes to premiums.

“The reality is, it’s going to be more of a cost to our employees either now or later,” Nelson said. 

Alabama Reflector is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. Alabama Reflector maintains editorial independence. Contact Editor Brian Lyman for questions: info@alabamareflector.com.

The post Alabama state employee insurance board to seek more funding, benefit changes appeared first on alabamareflector.com



Note: The following A.I. based commentary is not part of the original article, reproduced above, but is offered in the hopes that it will promote greater media literacy and critical thinking, by making any potential bias more visible to the reader –Staff Editor.

Political Bias Rating: Centrist

This content presents a straightforward and factual report on the financial challenges faced by Alabama’s State Employees’ Insurance Board and the steps being considered to address rising healthcare costs. The tone is neutral, focusing on practical concerns such as benefit changes, fund withdrawals, and increased premiums without advancing a particular ideological stance or political agenda. The article emphasizes fiscal responsibility and the balancing act between maintaining benefits and managing costs, reflecting a balanced perspective commonly associated with centrist reporting.

News from the South - Alabama News Feed

Mobile man struggled with drugs after mother’s death ahead of police standoff

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www.youtube.com – WKRG – 2025-09-04 22:02:13

SUMMARY: Woodrow Meservey struggled with drug addiction following the death of his mother, Sally, who was his primary source of comfort after losing his father at age three. Close family friend Regina Rettig explained that Sally’s passing last year deeply affected Meservey, leading to a decline in his well-being. On Bay Front Road, neighbors reported Meservey making threats against police. When officers arrived, Meservey fired shots, prompting a SWAT standoff. Police returned fire, injuring Meservey, who later died in the hospital. Authorities continue investigating the incident, with many questions remaining unanswered as family and friends mourn the tragic outcome.

While investigators may never know why Woodrow Meservey fired at officers on Bay Front Road Wednesday afternoon, family and friends have an idea.

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News from the South - Alabama News Feed

News 5 NOW at 12:30pm | Thursday, Sept. 4, 2025

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www.youtube.com – WKRG – 2025-09-04 12:59:50

SUMMARY: On Thursday, Sept. 4, 2025, News 5 Now covered key local stories: a police standoff in Mobile ended with the suspect, Woodro Messerver, fatally shot after firing at officers. In Escambia County, a traffic stop led to a major drug bust involving meth, cash, and a gun. Mobile’s homeless outreach team is distributing new ID cards to help the homeless in Tilman’s Corner. A Bayonette attorney, Harry Still III, faces assault charges after attacking a city councilman. Downtown Fair Hope mourns Fancy, a beloved local cat. The show also discussed the new Dancing with the Stars cast and asked viewers about their football preferences.

The latest on a police standoff in Mobile yesterday, a major drug bust in Escambia County, and what one group is doing to help the homeless in Mobile.

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News from the South - Alabama News Feed

Analysis says Alabama Department of Corrections received $5 billion in state funding in five years

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alabamareflector.com – Ralph Chapoco – 2025-09-04 07:01:00


A recent report from Alabama Appleseed revealed that Alabama spent $5 billion on its Department of Corrections (ADOC) over five years, including $1.3 billion for a new prison in Elmore County. Corrections consumes about 22% of the state’s General Fund, second only to Medicaid. Rising costs stem from staffing shortages, construction, and legal fees due to prison violence and lawsuits. The aging prison population increases medical expenses, with nearly 30% serving life sentences. Experts suggest reforms like sentence reconsideration and expanded Medicaid for released inmates to reduce costs. New facilities aim to improve conditions, reduce violence, and limit lawsuits.

by Ralph Chapoco, Alabama Reflector
September 4, 2025

A report published last month estimated that Alabama spent $5 billion on the state’s prison system in the past five years.

The report from Alabama Appleseed, a criminal justice organization, said the total included ADOC paid for operations and the costs of a $1.3 billion new prison in Elmore County, including debt payments for the bonds the state issued to assist with the construction costs, contributed to the total.

“What came as a bit of a surprise was the trajectory over 20 years, and how the increase in prison spending has caused this ripple effect where these other important agencies, their budgets are not growing at the same rate,” said Carla Crowder, executive director of Alabama Appleseed.

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A message was sent to the ADOC on Tuesday seeking comment.

Corrections for decades has taken the second-largest chunk out of the state’s General Fund budget, only trailing Alabama Medicaid, which provides health insurance to about 1 million Alabamians, mostly children, elderly people or those with disabilities. The department is budgeted to get $826.7 million in the current fiscal year, about 22% of the total General Fund.

“That is why we have budget hearings, to get a grasp of the direction that we are headed and, more importantly, why,” said Sen. Greg Albritton, R-Atmore, the chair of the Senate in an interview on Tuesday.

He cited several factors for the increase in money allocated to ADOC.

“We are trying to hire people is the first thing,” he said. “The second thing is construction, and the third thing is lawsuits. I think those are three things where money gets sucked up in.”

Corrections has struggled to maintain adequate staffing in the prisons, a major contributor to a wave of violence in the state’s correctional facilities. The state has paid tens of millions of dollars in legal fees over litigation.

The Elmore County prison has proven far more expensive than legislators first expected. Lawmakers approved $1.3 billion for two prisons in 2021, expecting that to cover the cost of the Elmore facility and another prison in Escambia. Now, that amount is enough for only one prison.

Legislators have authorized transferring money from ADOC operations to help pay for the expected cost of the second prison planned for Escambia County. The Legislature has also authorized additional bonding capacity in 2025 should additional funding be needed.

However, legislators also allocate a greater share of the General Fund budget to the ADOC as the cost to operate the state’s prisons has increased dramatically in the past several years.

The Alabama Department of Mental Health, for example, received $244 million, or almost 8% of the General Fund dollars, for the current fiscal year, roughly a fourth of what ADOC was allocated. Another agency, the Alabama Department of Public Health, will receive about $160 million, almost 3% of the General Fund budget.

Agencies have other funds from which to draw, but the General Fund comprises a significant portion of their budgets.

Medicaid and Corrections’ share of the budget have grown significantly over the last 20 years. In 2002, they were responsible for about a third of the spending. By 2024 it increased to slightly more than half.

Medicaid went from $231 million in 2002 to $955 million in 2025, a 313% increase. Corrections went from $197 million to $737 million, an increase of 274% over the same period.

Crowder said part of the reason for the increased funding is meant to address years of underinvestment in the prison system. The additional allocations also deal with the problems that ADOC currently has recruiting and retaining corrections officers and the medical costs because of an aging prison population.

A higher percentage of people in Alabama’s prisons are expected to spend a greater share of their lives incarcerated in prison.

A study from The Sentencing Project published in 2024, a research and advocacy organization, said that almost 30% of people in state prison are practically serving a life sentence, meaning they will spend decades incarcerated before possibly getting released. This is compared to the national percentage at 16%.

“When you are sentencing a lot of people to life, that is a dramatic way of increasing the prison population numbers,” said Nazgol Ghandnoosh, director of research at The Sentencing Project.

As they age, their medical needs increase along with the corresponding costs.

“The best way to curb these costs is to evaluate older people who are serving unnecessary and extreme sentences, then rehabilitate and find pathways to release,” Crowder said. “To increase the availability of Medicaid for people who are leaving prison, other states have done this through a waiver program. And to invest more in front-end solutions like mental health care and drug treatment.”

There are limits for how much states can decrease the cost of incarcerating people solely by releasing some of those who are incarcerated.

“That is partly because the main significant way to experience savings in correctional costs is to shut down facilities or large sections of facilities,” Ghandnoosh said. “Just reducing the number of people and leaving the number of prisons the same doesn’t lower cost because every year you are going to have likely increases in staffing costs and so on.”

Some states, to reduce costs, are beginning to close facilities.

“By building a new facility and expanding capacity, that is likely going to result in prosecutorial decisions, legislative decisions, to fill up those prison beds,” she said.

The state, for its part, said the new facilities will not add new capacity to the system, but simply replace the capacity at other facilities slated to be closed. However, some lawmakers, like Rep. Chris England, D-Tuscaloosa, are starting to doubt if those facilities can close given the increase in the prison population.

Appleseed has been urging the Legislature to pass a bill for the past several years to allow judges to reconsider the sentences of people who spent decades in prison, and who did not cause any physical harm during their offenses.

Appleseed published its findings just as the Legislature received an update on the status of both the Educational Trust Fund and General Fund budgets prior to the start of the 2026 session in January.

ADOC was scheduled to appear before the Legislature last week as part of the budget hearings, but the appearance was cancelled. Despite that, Albritton said in an interview on Tuesday that he spoke with ADOC Commissioner John Hamm.

“I don’t see the increases continuing to develop,” he said. “I think we have gotten pretty close to the level of what the needs are. We seem to have gotten the pay scales up to a point that is making a difference, and gives us an opportunity to retain people.”

For Albritton, the key to bending the cost curve will be the construction of the new facility because the sources of increased expenses stem from problems with infrastructure.

“It does not cure all of our problems, but it will remove the threat and the aspect of several lawsuits that is on us right now and the cost that is associated with that,” he said. “It will also give us a means to control the violence better in the prisons themselves, and reduce the number of incidents there. It will also protect the corrections officers more and it will give us the facilities to maintain them, so just don’t ignore them and let them deteriorate.”

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Alabama Reflector is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. Alabama Reflector maintains editorial independence. Contact Editor Brian Lyman for questions: info@alabamareflector.com.

The post Analysis says Alabama Department of Corrections received $5 billion in state funding in five years appeared first on alabamareflector.com



Note: The following A.I. based commentary is not part of the original article, reproduced above, but is offered in the hopes that it will promote greater media literacy and critical thinking, by making any potential bias more visible to the reader –Staff Editor.

Political Bias Rating: Center-Left

This content presents a factual, investigative approach focused on the high costs and systemic challenges facing Alabama’s prison system. It highlights concerns about underfunding in other public sectors and the need for reform, issues often prioritized by center-left perspectives. The article references advocacy groups and acknowledges structural problems like lengthy sentencing and prison violence, while also including viewpoints from state officials, lending a balanced tone overall but leaning toward advocating for reform and increased scrutiny of current spending and incarceration policies.

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