Conn Health Pooling Plan Faces Delay

HARTFORD (AP) — Governor Dannel P. Malloy’s budget director on December 12 said he has serious concerns about opening up the state of Connecticut’s health insurance plan next month to municipal workers and wants the initiative delayed until the state’s risks can be examined further.

In a letter obtained by The Associated Press, Benjamin Barnes said he’s worried the state could face financial exposure if only small groups of city and town workers are pooled into the self-insured, state employee and retiree health insurance system.

“In particular, I am concerned that the plan will not be able to accommodate most municipal employees because of collective bargaining agreements in place,” said Mr Barnes, the secretary of the Office of Policy of Management (OMP), in the letter to Comptroller Kevin Lembo. He said if union contracts prevent many municipal workers from immediately switching over to the state’s plan, the groups that do agree to participate could have older, sicker employees with high utilization rates, possibly driving up the state’s costs.

Mr Barnes told the AP that while he sees health care pooling “as a very viable way to cut costs,” he wants the state’s health care actuary to analyze the program further to determine how many municipal employees can be expected to participate, what their health insurance utilization rates would be, and how much risk the state’s insurance plan could expect. He said it could take years to get a large enrollment.

Earlier this year, the General Assembly passed legislation requiring Lembo to offer coverage to municipalities. At the time, state officials estimated that nearly 578,000 municipal employees, retirees, and their dependents could join the state plan, which currently covers about more than 202,000 state employees, retirees, and dependents.

The legislation, a key issue for House Speaker Chris Donovan, D-Meriden, currently a candidate in the Fifth Congressional District race, also called for allowing more than 174,342 employees of nonprofit agencies to join the state plan beginning 2013.

Rep Donovan and other advocates maintain that by grouping more people together, the state can help drive down health care costs and make sure more people are insured.

The legislation required Mr Lembo to open up the plan to municipalities in January. However, Mr Barnes said OPM and the State Employees Bargaining Agent Coalition, which represents unionized state employee on health and benefits matters, have to first sign off on the proposal before any municipal workers could join. He said in his letter OPM “will not be able to support it absent significant changes and more rigorous evaluation.”

Mr Barnes said he understands that additional analysis will delay the opening of the program beyond January. But he added, “I am sure we can all agree that protection of the state’s resources is critical. This is especially true now given the fiscal challenges that we all face.”

A message was left seeking comment with Mr Lembo.

During the legislative debate in June, some Republican lawmakers voiced concern about opening up the state’s health insurance plan to other groups. State Senator Leonard Suzio, R-Meriden, said he worried the move could drive up claims and eventually drive up premiums paid by state employees and costs for taxpayers.

Mr Barnes said he expects the additional review could delay opening the program until late winter or early spring, unless the actuary determines the state will be facing large financial risks.

If that happens, Mr Barnes said, “We’ll just have to go back to the drawing board and figure out how to adjust that.”