Changes few in health plans for small employers in Md.

Premium costs a concern for state regulatory panel

October 18, 2002|By M. William Salganik | M. William Salganik,SUN STAFF

Facing its annual trade-off between demands for more benefits and calls for keeping premiums down, the Maryland Health Care Commission approved yesterday only small changes in the standard benefit package for small employers.

The state-regulated policies for companies with fewer than 50 workers cover 456,000 Marylanders, 2.8 percent fewer than were covered a year earlier. Enrique Martinez-Vidal, deputy director of the commission, said anecdotal evidence suggests that the majority of the decline in participation has resulted from price increases.

The commission did approve one new benefit, requiring coverage for mental health and substance-abuse treatment at residential crisis centers. Martinez-Vidal told the commission that such treatment is less expensive per case than if patients are admitted to hospitals, but that adding the benefit might increase use of the service, producing a slight increase in cost overall.

The commission approved a staff suggestion that it clarify through regulation the coverage required for problems resulting from birth defects.

The changes, which will take effect in July, are projected to push the average cost of coverage to 87.9 percent of the state's affordability ceiling (set at 12 percent of the average wage), slightly more than the estimated 87.8 percent if the changes had not been made.

One commission member, Ernest Crofoot, argued that the commission should add benefits until the ceiling is reached. In particular, he supported requests to cover surgery for morbid obesity and vaccinations against meningitis.

"We're not giving the most health care we can get for the people," Crofoot said.

Other commissioners said they are concerned about affordability. "We can't afford to buy everything for everybody," said J. Dennis Murray.

The commission's chairman, Dr. Donald E. Wilson, warned, "Health insurance this year is going out of sight again." He called for the commission to "take a look at the entire list" of required benefits soon so that it can decide whether some should be dropped and others added.

Coverage should be based on solid research about health benefits, as opposed to "individual testimonials" from people at public hearings, he said.

This year's hearing, held this month, produced few demands for additional benefits, Martinez-Vidal told the commission. Most of the testimony came from business groups and insurers who said no required benefits should be added so that cost increases can be moderated, he said.

A study released this week by the Center for Studying Health System Change in Washington concluded that health insurance cost increases are a greater problem for small employers than for large ones.

"Small employers pay more for coverage and typically have lower-wage workers than large employers," said Paul B. Ginsburg, president of the center.

The average cost to insure an employee through the Maryland small-employer coverage last year was $3,565, according to commission data.

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