Rate Increase

Profit margins at Maryland hospitals slipped again last year, the fourth straight year of decline, according to figures released yesterday by the Maryland Hospital Association. Operating margins for the hospitals as a group, though tight, gained slightly in 2000, to 1.1 percent from 0.9 percent in 1999, according to the MHA. But total margins - including nonhospital items such as investment income - dipped to 2.4 percent from 2.5 percent in 1999. The profit squeeze prompted the MHA earlier this month to say that it would seek a larger than planned rate increase for the fiscal year beginning in July.

SACRAMENTO, Calif. - After spending months voicing opposition to rate hikes, California Gov. Gray Davis acknowledged to a statewide television audience last night the need for an electricity rate increase that would average 26.5 percent. For the first time calling it an "energy crisis," Davis enumerated steps he has taken, then said he has fought "tooth and nail against raising rates." But saying increases were needed, the Democratic governor called for a tiered system in which people who use the most electricity pay the most - as much as 37 percent if they use more than twice their minimum allotment.

Taxicab riders in Howard County will be paying more for transportation soon if the county government approves a request for a rate increase.Frank Osei-Bonsu, owner of Columbia Cab, the largest operator in the county, is asking for a fare that would match the rates in Montgomery County, which are the highest in the Baltimore-Washington region.Under the requested rates, an average five-mile ride for one person with luggage would cost $2 more than the current $7.60 fare, the cheapest in the region.

Citing sagging revenues and climbing expenses, Baltimore Gas and Electric Co. asked the Maryland Public Service Commission yesterday to boost electric and gas rates by $169.4 million a year, adding $8.12 to the average customer's monthly bill.The rate request would increase the company's electric revenues by $163.8 million, or 8.6 percent, and natural gas sales by $5.6 million, or 1.5 percent.For an average household using 600 kilowatts of electricity and 90 therms of gas each month, the proposed changes would increase the electric bill by $6.79 a month, to $62.95, and the gas bill by $1.33, to $54.75.

WASHINGTON -- The Federal Reserve's interest rate increases could be over for the foreseeable future. Credit luck on the energy front, in part. But a sinking housing market is also playing a prominent role, along with deep troubles in the automobile industry. Falling oil and gasoline prices and the bursting of the housing bubble have helped the central bank and its relatively new chairman, Ben S. Bernanke, breathe a sigh of relief about those haunting fears of inflation he had harbored.

MILLIONS of consumers will get a firsthand look at Federal Reserve monetary policy in action when they tear open their next credit-card statement. After four years without a rate increase, Fed policy-makers last week raised a key short-term interest rate by one-quarter of 1 percent. Many credit-card issuers won't waste much time adjusting the rates they offer customers, experts said. The average interest rate on variable-rate cards last week was 13.5 percent, according to Bankrate.com, and a quarter-point increase won't have a big impact.

Creating leverage in the fight against a 72 percent electric rate increase, a House of Delegates committee voted yesterday to give the General Assembly power to thwart an $11.4 billion merger between Constellation Energy Group and Florida's FPL Group. Legislative leaders said the plan is more than a negotiating ploy, calling it a meaningful tool to confront a sale that they said could hurt customers while making executives and shareholders wealthy. "I think the citizens of Maryland better make sure that in this, the largest merger in the history of the state of Maryland, that they know they are getting a fair shake," said House Speaker Michael E. Busch.

Electric rates will be going up again in January, but by less than half the amount the Baltimore Gas & Electric Co. had sought.The Maryland Public Service Commission today approved a $77 million increase in BG&E's electric rate, to take effect Jan. 1.The 4.7 percent increase is well short of the $194 million, 12 percent rate boost the company sought in its rate request last May. That request -- the largest in the company's history -- would have boosted the...

After several hours of technical debate, the Health Services Cost Review Commission unanimously approved a 6.07 percent rate increase for Johns Hopkins Hospital yesterday. That will add about $42 million a year to patients' bills at Hopkins. Under the commission's rate-setting formula, any extra increase granted to one hospital comes out of the statewide inflation adjustment applicable to all hospitals in the next fiscal year, which begins July 1. Saying they were worried about the affect of the rate increase on the state's 51 other hospitals, the commission agreed to appoint a work group to review the inflation formula.