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When Fred A. Burdette retired from Blue Cross and Blue Shield of Maryland in 1985, the company promised him health benefits he thought would last the rest of his life.

But now, following a nationwide corporate trend, Blue Cross is scaling back benefits for 300 former workers. Angry retirees say they face higher out-of-pocket medical expenses and a diminished sense of security.

"We all retired with the expectation of keeping our benefits," said Mr. Burdette, 73, of Phoenix, Baltimore County. "If they're knocking the benefits all to heck, a lot of people are going to get hurt."

Blue Cross officials emphasize that -- unlike many corporations -- the company is continuing to offer retiree health benefits.

The changes, which go into effect tomorrow, mean that 300 people who retired before 1992 will receive the same benefits as those who retired later. The biggest difference for most of the 300 is cost. The level of insurance coverage remains about the same, according to company officials.

Blue Cross will no longer pay the Part B Medicare premium of retirees, a $552 annual cost, and the retirees' share of prescription costs will increase. The company will continue to pay the premiums for health and life insurance.

John A. Picciotto, Blue Cross general counsel, said the changes are part of a companywide cost-cutting program that is saving $2 million.

In taking this step, Blue Cross joins a growing number of companies trying to trim health benefit costs of retirees. Fewer and fewer companies even offer health benefits to former employees.

In 1994, 43 percent of employers provided health benefits to most retirees under age 65, down from 46 percent in 1993, according to Foster Higgins, a benefits consulting firm. Only 24 percent of employers pay all the premiums; 30 percent require workers to pay the full costs.

Forty percent offered coverage to retirees 65 and older who are eligible for Medicare.

Such statistics don't console Blue Cross retirees. Changes in the company's retiree plan appear designed to pressure people to give up traditional insurance and join less expensive health maintenance organizations, said Mr. Burdette and C. Carroll Miller, 62, a former Blue Cross employee who lives in Rodgers Forge.

Retirees in HMOs will pay $5 per drug prescription, instead of the current $1 fee. But people who choose a non-HMO plan will pay 20 percent of the price of each prescription, a prohibitive cost for many elderly people who take a lot of medicine.

"We have one retiree whose prescription drug bills are over $4,000 a month," said Marie Frizzell, vice president of the Blue Cross and Blue Shield Retirees Club, which issued a statement criticizing the company.

Mr. Miller said he helped establish the Freestate HMO owned by Blue Cross and believes in the HMO concept. "But it's not for everyone," he said, adding that switching from traditional insurance to an HMO may require patients to end long-standing relationships with doctors.

The company also is limiting its life insurance coverage for retirees to a maximum of $25,000. Previously, it provided as much as twice a worker's final salary.

Mr. Burdette, who is recovering from shoulder surgery and uses a wheelchair because of problems caused by polio, is further incensed because, he said, Blue Cross isn't willing to compromise. But Blue Cross denies that.

To help lower drug costs for retirees, the company will investigate whether it can use a cheaper mail-order source of medicines, Mr. Picciotto said.

But Blue Cross officials could not allay retirees' fears about future benefits. "We must continue to maintain flexibility to make changes to retiree benefits as necessary over time," Chief Operating Officer David D. Wolf said in a letter June 21 to Mr. Miller.

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