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Budget keeps $44M freebie

By Gary Fineout
4/29/2009 © Health News Florida 

Florida’s tentative budget deal includes a great many cuts. But here’s one thing it won’t touch: the free health insurance offered to 26,000 state employees and their families -- including legislators themselves. 

Indeed, more than 1,000 of the state employees eligible for free coverage are paid at least $100,000 a year, according to employment records reviewed by Health News Florida.  The Department of Management Services says that if all of those who are eligible were to sign up and pay at the usual rates, the state budget would gain $44 million.

The average annual pay of those offered free coverage is two to three times the less-than-$35,000 average of the “career-service” employees who have to pay premiums, records show. For some, that raises questions of fairness.

Since the “little people” in the state workforce have to pay, the charge should apply to all, said Senate Democratic Leader Al Lawson, D-Tallahassee. “If everyone paid something, it would be more equitable for everybody.” 

But the subject hasn’t even come up in budget talks, said Sen. J.D. Alexander, R-Lake Wales and chairman of the Senate budget committee.

Health-system experts outside Tallahassee say this practice is out-of-date. “Not even Microsoft pays 100 percent anymore," said Brian Klepper of Atlantic Beach.

Klepper said it’s not right that the ones being paid the most get the freebie. “Across America, it's fairly well accepted that higher-paid employees should pay a higher burden of health care costs," he said.

But Gov. Charlie Crist, who often says he stands up for the little guy, has no problem with offering free health insurance to some state employees. “I think it’s always a good idea to keep reviewing and monitoring the economic situation we are facing, but I think the way it is now is pretty good,’’ Crist said Tuesday. 

The 2007-08 workforce report says more than 91,000 state workers are in the career service system. They pay $50 a month for individual coverage or $180 for family coverage; taxpayers cover the lion’s share, $377.86 for an individual and $787.60 for family coverage. 

Those eligible for free health insurance are senior managers and “select-exempt” employees, a mixed-bag of professional and technical workers assigned to that category because the state classifies their job as supervisory or involves handling confidential information. 

Lawson said the ranks of state workers eligible for free health insurance shot up in 2001 when former Gov. Jeb Bush switched 16,000 state workers out of the career service system to a category called “select exempt.” The legislation at the time included $20 million to pay for increased benefits to compensate for the loss of greater job security in career service. 

There hasn’t been any serious discussion about charging for health insurance since then, even though health-care costs have doubled.

Career service workers earn an average of $34,508 while select exempt employees earn an average of $53,486. Senior management employees earn an average of $109,407, and select-exempt workers average $53,486. 

Key elements of the evolving budget deal include a $30 million cut in state worker pay. While House Speaker Larry Cretul said the details of that cut have yet to be worked out, Lawson said it would probably equate to a pay cut for any state worker making over $65,000. 

Sen. Dan Gelber, D-Miami Beach, said it’s bad enough that state workers are getting hit with a pay cut after going without a raise the last three years. If they were forced to pay for health insurance, he said, “I would worry we would wind up with more people uninsured.”