City workers to pay more for health insurance

Union, nonunion, retired employees all affected

September 30, 2004|By Doug Donovan | Doug Donovan,SUN STAFF

The city's Board of Estimates yesterday approved new cost-sharing for the medical plans of elected, appointed and non-union employees, and approved higher health care premiums that will raise insurance costs for active and retired city workers.

The increased costs, which passed by a 3-2 vote, will take effect Jan. 1 and are needed to help the city afford the $243 million it is projected to spend for health care in 2005, a 9.6 percent increase over this year.

The approximately 1,300 city employees who are appointed, elected or not represented by a union will have to pay a 10 percent premium for health maintenance organization plans. They currently pay nothing.

In addition, retirees and active employees will see the costs of the CareFirst BlueCross BlueShield plans increase 13.4 percent.

Those premium increases will hit the approximately 17,000 retired city employees harder than active employees because retirees must cover 50 percent of their premium costs on their two most popular plans: CareFirst BlueCross BlueShield Traditional and CareFirst BlueCross BlueShield PPN. Active employees covered by unions pay 15 percent of premiums for those plans.

The higher rates will increase how much retirees pay in premiums for those plans. The city's 50 percent share of the premiums, however, will not increase because it is locked into the cheaper current rates.

"Retirees shouldn't take the hit," said City Council President Sheila Dixon, the board's chairwoman, who voted against the increases.

Comptroller Joan M. Pratt, a board member, joined Dixon in her opposition.

Ernest Glinka, an elected trustee for the employees retirement system, accused the board of imposing higher rates on retirees because they have no bargaining rights.

The board did agree in its vote to discuss next week the financial implications of delaying the increases for one year. Last week, the City Council released the report of a task force created to find ways to reduce the city's health care costs.

"During the moratorium, the city and members of the task force can work together to enact changes that are fair, reasonable and responsible instead of just raising the costs and reducing the benefits," Glinka said.

Mayor Martin O'Malley said he did not want to raise the rates but that the city was suffering from the same trend of skyrocketing medical costs gripping the entire nation.

"I wish I had the power to protect my people," O'Malley said.

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