Health plan cost rises for Md. workers Top insurance to be 5 times more expensive

An article in yesterday's editions of The Sun incorrectly attributed to Frederick W. Puddester, Maryland's deputy budget secretary, a statement that costs for the blue-ribbon health insurance plan for state employees had risen, in part, because of over-utilization and unnecessary testing. In fact, the statement was made by Joseph Adler, deputy secretary of personnel.

The Sun regrets the errors.


Tens of thousands of state workers will have to pay at least five times more for health insurance starting in January if they want to keep their current coverage.

In a cost-cutting measure, the state is shifting much of the burden of its blue-ribbon health care plan onto the shoulders of the 40,000 active and 18,000 retired state workers who use it.


The Blue Cross/Blue Shield preferred provider plan, as it is known, pays 100 percent of health care expenses in many cases. It is by far the most popular choice of state employees.

The problem, state officials say, is that it is not paying for itself.

In the past two years, it has run at least $26 million in the red, according to state officials. If the state didn't raise employee premiums, the plan would cost taxpayers an additional $40 million next year, said Joseph Adler, the state's deputy secretary of personnel.

"If health care's not controlled, it will become a budget buster," Mr. Adler said. "If we continue to have these kinds of deficits, people will have to be laid off."

Employees using the program will not be left without insurance options. Many are expected to jump to one of the seven other plans offered by the state, including four health maintenance organizations.

A lot of people are not happy about it, though. While workers will pay much lower premiums for the other plans, many will also have to give up their personal physicians.

As news of the plan filtered through state offices yesterday, employees and their unions howled with protest.

"They just can't do this," said Sue Esty, the legislative liaison for .. the American Federation of State, County and Municipal Employees Council 92 in Baltimore, which represents about 10,000 state workers.


"There is absolutely no way to justify this kind of increase. We're talking about people who haven't had a pay raise in three years and been subject to the possibility of layoffs."

Workers said they were shocked and angry. "I felt like falling through the floor," said Margaret O'Toole, 55, a secretary with the state Division of Adult and Family Services. "How can all this be happening?"

Like a lot of people, Ms. O'Toole will pay dramatically higher premiums if she sticks with the preferred provider plan. She currently pays $11 every two weeks. Next January, the biweekly premium will rise 490 percent to $65.

That's a lot, she says, for someone who earns $23,000 a year. Ms. O'Toole said she may have to switch to another insurance plan, perhaps an HMO, but she doesn't want to. "I prefer to stay with my doctor," she said.

For a family of three, the premium will rise from the current $26 every two weeks to $147.

The cost of the plan has gone up for a number of reasons, state officials say. Workers have been using the health care system too much, sometimes requesting unnecessary tests and driving the plan's cost up 35 percent in the last year, according to Frederick W. Puddester, the deputy budget secretary.


Currently, the state pays 85 percent of the total cost of the plan and workers pick up the remaining 15 percent. In January, the state will shift the burden so that it pays just over 50 percent, with workers picking up the rest. The cost sharing ratio for the other plans has not changed, Mr. Puddester said.

The state will formally notify workers of the changes in the next week. They will have through the month of November to decide whether to change their insurance.