Benton misled legislators, Ford charges

December 10, 1993|By John W. Frece | John W. Frece,Staff Writer

In an extraordinary public feud, one member of the governor's Cabinet is accusing another of intentionally misleading legislators and the public as part of a successful scheme to win control of a huge state program.

State Personnel Secretary Hilda E. Ford, in interviews last week, accused Budget Secretary Charles L. Benton Jr. of wildly exaggerating the size of a deficit in the state employee health insurance program.

The governor transferred authority for the program to Mr. Benton in October amid suggestions that it had been poorly managed under Ms. Ford.

Ms. Ford -- admittedly angry that Mr. Benton has publicly blamed her department for the program's financial problems -- said she believes that Mr. Benton wanted the program for reasons that go well beyond bureaucratic turf-building.

By gaining control of a $300 million-a-year program that is heavily dependent on arbitrary estimates of future costs, she suggested, Mr. Benton has put himself in a position to divert money subtly for other uses, such as for budget initiatives in Gov. William Donald Schaefer's final year in office.

Ms. Ford also theorized that Mr. Benton might hope to use his new authority to make decisions helpful to the financially beleaguered Blue Cross and Blue Shield of Maryland -- which, she now charges, has been "woefully incompetent" in administering the insurance program on behalf of the state.

"Benton has been trying to get the program for seven years. It is no secret. I have fought him for seven years," said Ms. Ford, 69, who, like Mr. Benton, 77, moved to state government with Mr. Schaefer in 1987 after working for him when he was mayor of Baltimore.

"If you can get your hands on the [insurance program], you can skim off whatever you need," she asserted.

Mr. Benton dismissed Ms. Ford's allegations as "ludicrous."

The budget secretary said he never sought control of the insurance program, but rather was asked by the governor to take it over.

"I just don't know how in the world anyone could come to such a conclusion," said Mr. Benton.

Governor Schaefer said he was saddened to learn that two of his longtime associates had chosen to trade allegations in the newspaper. He said, through his press secretary, that he may ask a third party to try to sort out the truth of the various accusations.

He said, however, he is convinced that Mr. Benton is not part of any scheme to divert funds to other state programs or to improperly aid Blue Cross.

Mr. Benton was given authority for the insurance program, administration officials have said, after a furious Mr. Schaefer learned through newspaper stories of a plan attributed to the Personnel Department to increase employee premiums by more than 500 percent.

The budget secretary was soon telling legislators that a subsequent review by his staff revealed that the program was at least $60 million and potentially as much as $117 million in the hole -- a revelation he said "absolutely shocked" Mr. Schaefer.

Mr. Benton said that personnel officials "knew or should have known" what was going on, but never alerted anyone.

Ford position

But Ms. Ford complains that Mr. Benton intentionally painted the situation -- and her department -- in the worst possible light.

She says, for example, that her department was unfairly blamed for the plan to increase premiums five-fold when it was Mr. Benton who "selected and initiated that option -- and insisted we adopt it."

Ms. Ford concedes that the insurance program owes Blue Cross between $22 million and $27 million in reimbursement for disputed claims and fees from 1992, and she acknowledges another $30 million deficit developed this year because of a budgeting mistake.

But she contends that this year's problem, as well as future shortfalls predicted by Mr. Benton, would have been recovered through higher rates her department planned to charge in 1994 and 1995.

Asked about Ms. Ford's assertions, Mr. Benton and his aides say the budget department did endorse the 500-plus percent premium increase because, however onerous, it was better for state workers than a plan being advanced by Ms. Ford's agency.

That would have required employees to pay 20 percent of whatever their medical bills were, without limit.

Mr. Benton also defends his estimate of the insurance program deficit.

William S. Ratchford II, the legislature's chief budget adviser, said he believes that Mr. Benton's numbers are generally accurate.

But Mr. Ratchford also agrees with Ms. Ford that the way Mr. Benton presented the problem in public appeared to "over-dramatize" the severity of the situation.

The true extent of the shortfall, now the focus of auditors, may not be known for months.

Ms. Ford, in her interviews with The Sun, also leveled criticisms at Blue Cross.

Like many big businesses, the state government is self-insured, but pays Blue Cross to administer the program.

Blue Cross pays the doctors, hospitals and others who provide medical care to state employees, and then is reimbursed by the state and paid a fee for its services.

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