February 23, 2011

WFSE/AFSCME urges rejection of Indiana-style anti-state employee health insurance legislation

The anti-state employee plague that is sweeping through state houses in the Midwest flared in a Senate committee in Olympia Tuesday. It came a day after a 2,000 Federation-led crowd filled the state Capitol in solidarity with Wisconsin’s public servants -- and a day after Wisconsin-style anti-collective bargaining legislation officially died for this session in Washington’s Senate.

Tuesday’s battle came over Sen. Joe Zarelli’s SB 5773 to impose a high-deductible health savings account option for state employees.

More than 70 percent of state workers in Indiana choose such a plan, why not here? Zarelli asked Federation Executive Director Greg Devereux during testimony in the Senate Ways and Means Committee.

“The reason folks in Indiana have gone from 44 percent to 70 percent participation is the State of Indiana is not offering other insurance,” Devereux said. “They’re trying to move everyone into health savings accounts in the State of Indiana.”

The Legislature in 2006 passed a bill directing the state Health Care Authority to develop a health savings account option. But SB 5773 goes further and orders the HCA to impose that option.

Health savings accounts impose high deductibles (at least $1,000 just for individuals) and annual out-of-pocket costs up to $5,000. Proponents lure participants by saying if they rarely go to the doctor, they get to keep any leftover money in their account.

But health savings accounts drive up costs for workers and families and don’t contain overall costs.

“They simply shift costs onto the participants…,” Devereux explained. “The premium costs for the older and less-healthy workers often spiral then out of control.”

Health savings accounts are a wolf in sheep’s clothing, he told the senators.

“Our concern is that for any individual yes it may be less costly for that individual, but it may lead to overall cost increases in the overall pool the way you design a health savings account,” Devereux said.

What is needed is cost containment, getting at the root causes of health care costs, said Devereux, a 16-year member of the Public Employees Benefits Board.

“The costs that we really need to get in line are providers and hospitals,” he said.

For instance, the Health Care Authority has probed why there’s such a variation in costs for the same medical procedures at individual hospitals, he said.

“I mean, each year on the PEBB, we deal with a 6 percent to 8 percent inflation rate,” Devereux said. “If I could get a 6 percent to 8 percent inflation rate for my members every year, I would die and go to heaven.”

SB 5773 has until Friday to pass out of committee.

Call 1-800-562-6000. Tell your state senator to oppose SB 5773. Say no to Indiana-style health care cost increases.

• The Federation’s Matt Zuvich registered concerns about Senate Joint Resolution 8214, the well-intentioned effort to address the state’s long-term pension obligations. The concerns center on the proposed ballot measure’s mechanics, not its intent.

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