Health contract vote anticipated

Lawmakers expect close decision

State Rep. Jim Fannin said Tuesday that he expects the vote to be close later this week on a contract affecting thousands of current and retired state workers.

“At the end of the day, it will be OK,” he predicted.

Fannin, D-Jonesboro, chairs the Louisiana House Appropriations Committee, which is scheduled to meet Thursday with the Senate Finance Committee to review the Jindal administration’s plans to hire Blue Cross and Blue Shield of Louisiana for the handling of state employee health plans.

The meeting will be at 9:30 a.m. Thursday in House Committee Room 5 at the State Capitol.

Two weeks ago, conflicting reasons were given for the cancellation of an earlier meeting on the contract.

Fannin said legislators needed more time to review the lengthy contract. State Rep. Katrina Jackson, D-Monroe, said the Jindal administration lacked the needed support.

At stake is a new health insurance provider for thousands of people and the loss of 177 state government positions at the Office of Group Benefits.

The Office of Group Benefits provides health and life insurance to about a quarter-million current and retired state employees and their dependents, some of whom already receive health insurance through Blue Cross.

The Jindal administration claims it can save $20 million a year by hiring Blue Cross to serve as a third-party administrator for more than one health plan.

Much of the cost savings would derive from firing dozens of state workers at the Office of Group Benefits. Blue Cross would start handling the Preferred Provider Organization in addition to the Health Maintenance Organization the company already manages.

The PPO is managed by state workers at the Office of Group Benefits and covers 62,010 insured lives.

A PPO is a group of doctors, hospitals and others providing health care at reduced rates.

The HMO places patients under the care of a primary care physician.

The HMO covers nearly 165,000 insured lives.

Fannin said the proposed contract is a complicated document that will generate questions. He said he is not bothered by any of the provisions but realizes others might be unfamiliar with how such contracts work.

“It will be a close vote, on the House side anyway,” he said.

Senate President John Alario, R-Westwego, said hiring Blue Cross is a good idea.

“It’s a savings for the state. It makes it much more efficient,” he said.

Alario said change always is difficult.

“Every vote is close,” he said.

Jackson, who serves on the House Appropriations Committee, complained that loopholes in the contract will allow the Jindal administration to increase payments to Blue Cross without legislative input.

“In this time of fiscal uncertainty and when we are cutting services to citizens around this state, the administration is asking us to approve a three-year unlimited contract,” she said.

State Rep. Patricia Smith, D-Baton Rouge, raised identical concerns. Like Jackson, Smith serves on the House Appropriations Committee.

“The trust factor between this administration and state workers, and some legislators, has diminished tremendously, thus making it difficult to believe that this is indeed a good move for state workers,” Smith said in a prepared statement.

Former state Sen. Butch Gautreaux, a vocal critic of the plan to outsource state employee health plans, suggested current and retired state workers will end up paying more under the guidance of a private company.

The Jindal administration announced plans in May for a 7 percent decrease in premium costs for plan members effective Jan. 1.

“After reviewing the contract, my real concern is what will happen after 2015. At that point, there will be a new contract and no one can predict what the market will be. Right now, we have a long history that our actuary has said has great predictability. Once we lose the PPO, and likely OGB, we will no longer be the master of our own destiny,” Gautreaux said.

State Rep. Brett Geymann, R-Lake Charles and an appropriations committee member, said he is undecided on how to vote on the contract.

“I am still going through the information I have requested,” Geymann said.