Why State Employees Should Be Skeptical of a Premium for the State Health Plan

In the furor over the state health plan bailout, health plan director Jack Walker has consistently called for a new monthly premium from state employees for individual coverage. State employees – unlike many other workers – now pay no monthly premium for health coverage. Walker – and some legislators – argue that a new $10/month premium would bring in about $90 million a year and that money would be used to lower the sky-high premiums for family coverage in the plan.

State employees might have to look at paying a monthly premium to help save the plan but they have a right to be skeptical. Consider this – since the introduction of the state health plan bill in the Senate, health care special interests, specifically pharmacy chains and pharmacists, chiropractors, and physical and occupational therapists, have gotten amendments to the bill that cost the state health plan $77 million a year. Another amendment added in the House Insurance Committee to change the plan year is estimated to cost $24 million this year.

So, state employees are being asked to pay $90 million a year in new premiums at the same time the NC House and Senate have added over $101 million in costs to the health plan – largely for health care special interests. How can state employees trust that premium increases won’t just go to lining the pockets of the politically powerful instead of really reducing rates for families?

11 Comments

  1. Middle Road

    April 6, 2009 at 2:18 pm

    Adam, this is one of the fundamental weaknesses of government health insurance in general — susceptibility to pressure from special interests, especially ones with strong lobbying arms. Why do you think there was so much pressure to confirm that funds for comparative quality studies in Obama’s stimulus bill would not impact reimbursements?

    If you want the upsides of government health care — no marketing costs, single admin system and a single risk pool (at least potentially) — then you’ve got to take the downsides, too.

  2. Adam Searing

    April 6, 2009 at 2:27 pm

    MR -

    I agree, and that’s why our suggested health reform plan keeps a role for private insurers along with a broader government safety net:

    http://www.ncjustice.org/?q=node/115

  3. IBXer

    April 6, 2009 at 2:53 pm

    “How can state employees trust that premium increases won’t just go to lining the pockets of the politically powerful instead of really reducing rates for families?”

    It’s a government run healthcare plan. That’s what government ran health plans do. Government control of healthcare serves no other purpose than to give more power over our lives to politicians.

  4. Adam Linker

    April 6, 2009 at 4:56 pm

    Not to mention that state employees are being lectured by lawmakers about accepting a premium but legislators are not offering any long-term fixes to the State Health Plan. That means the SHP will continue its death spiral and premiums will continue to increase.

  5. Monkey

    April 6, 2009 at 6:40 pm

    Some state employees are already paying a premium of $43.98 to participate in the “90/10 Plus Plan”, the third and highest tier of coverage. This is the same plan the Senate bill will abolish. Now the legislature wants state employees to pay a premium for a lower quality health plan?

  6. Jake

    April 7, 2009 at 8:44 am

    I saw my children’s pediatrician this weekend and he told me that BCBS has sent medical practices letters that state that future services provided by nurse practitioners and PAs will only be reimbursed at a 25% rate. He is wondering 1) if he should fire his three PAs/FNPs; 2) try to absorb the 75% loss; or stop accepting BCBS (40% of his patients use BCBS). He is seething at the profits this nonprofit makes (I am too and I am a state employee). BCBS seems to be putting everyone in a strangle hold in order to generate more and more profits.

  7. Terry

    April 7, 2009 at 3:25 pm

    State workers have been spoiled far too long. The vast majority of people in this state pay no less than $120 per month for their share of their insurance premium (individual coverage) plus a $350/year deductible (on average). State workers are complaining about paying $10/month towards their health insurance?! Give me a break!

  8. dave

    April 7, 2009 at 9:05 pm

    Thank you Terry for the dose of common sense. I admire Adam’s analysis, but these tough times call for sacrifices from ALL of us, including Mr. Greczyn and all of his BCBS colleagues, and Gov. Perdue and all of her state employee colleagues. $10 a month for health insurance would signal that such coverage is a privilege that comes at a cost, perhaps?

  9. Adam Searing

    April 8, 2009 at 3:34 pm

    Well, perhaps a premium wouldn’t be a bad idea if NC Blue Cross was also offering to reduce its (unaudited so far) charges to the state health plan substantially and the pharmaceutical industry was also agreeing to lower profits on drugs they sell to the state health plan as well (state law protects them now by preventing the state plan from getting really tough on costs). But, surprise, surprise, there’s only one group that’s being asking consistently to pay more, and more, and more – and that’s state employees.

  10. EBB

    April 9, 2009 at 7:15 pm

    Going back to April 6 comments regarding “government run health care” – I would say what we have in NC is government supporting a market-based, for profit health insurance system because of the kick-backs legislators receive. Public plans do NOT have to work this way.
    On April 7 Dave is being understanding that these are tough times and we all need to pay our share, and he mentions “Mr. Greczyn and all of his colleagues” – Somehow I don’t think these folks are being called to make sacrifices, not as long as someone doesn’t audit BC/BS’s books and makes sense of why the SHP ended up in the current mess.

  11. concerned

    April 15, 2009 at 8:42 am

    I pay 430 a month for family coverage as a state employee, now they are talking about 100 more? AND less benefits? I just might not be able to do this. I mean pay more for less?