Trouble brewing on insurance front

By By Buddy Bynum / editor
Feb.8, 2004
What is so sacrosanct about state government that state employees couldn't pay at least part of the premiums on their own health insurance?
Nothing.
The idea that state employees may have to ante up for their own health insurance premiums is floating, albeit like a lead balloon, through the hallowed halls of the Capitol. It's one of the tough choices Mississippi lawmakers need to seriously examine if they want to keep the state employees' insurance program afloat.
Currently, state workers including school teachers pay no premium for their own insurance. They pay premiums only if they add family members to their plan.
Before the state plan starts covering expenses, the employees must pay $450 for their annual medical costs $900 for a family. They also have to pay $50 per person for their annual pharmacy costs before insurance starts covering some of the costs.
These are not unreasonable deductibles. Private businesses fight the same battle over insurance costs.
Like a business
So, what's so sacrosanct about state employees?
Nothing. Many people believe state employment should be treated more like a business, and many state employees cringe at the thought.
Gov. Haley Barbour believes the state could save $54 million a year by changing the state insurance plan to make it more like federal employees' coverage. Employees could contribute toward their own premiums to receive more coverage, or they could opt to keep no-premium coverage and possibly have higher deductibles.
According to The Associated Press, some school counselors at the Capitol last week said schools could have trouble attracting and retaining employees if insurance becomes more expensive or benefits decrease. Thousands of Mississippi teachers are eligible to retire.
Is this what state employment has come to, employees working for the insurance and retirement benefits?
Whatever happened to the old notion of public service?
To be sure, many, many public employees are devoted to their jobs and do them quite well. People working in the public sector should not be punished, nor should they get special treatment.
You have to wonder whether an agency like the Mississippi Development Authority, for example, really needs more than 300 employees, some of whom from my personal observation seem fairly distant from the main job of recruiting new businesses to the state.
Too many?
Could it be that there are too many state employees?
The state insurance plan is in trouble and changes are not likely to be popular. But its administrator says the program needs either a 23 percent increase in premium payments, which are now covered by the state; or a 23 percent cut in benefits.
Lawmakers have options:
Make workers pay some out-of-pocket expenses for their own premiums.
Eliminate prescription drug coverage and increase annual deductibles.
Require a combination of higher premiums and fewer benefits.
Change state laws to give workers the option to buy different levels of coverage.
If officials do nothing, the self-funded state employees' insurance plan will run out of money by November.
The state employees' health insurance plan covers 192,053 people, from active employees to retirees to dependents. The plan administrator says 95 percent of the money paid into the plan is paid out in claims, and the remaining 5 percent covers administrative costs.
As with many insurance plans, most healthy people cost the state plan little money in claims and a few seriously ill people cost a lot.
In 2002, 59.7 percent of people on the state plan made claims of zero to $999, and 1.8 percent of the money paid in claims went to them. That year, 6.7 percent of the people on the state plan made claims of $10,000 or more, and 65.4 percent of the money paid in claims went to them.
Health insurance is absolutely essential, but I see nothing inherently unfair in state employees picking up some of the tab for themselves.