Insurance costs rising at SEMO

Monday, November 11, 2002

Southeast Missouri State University employees could wind up with less take-home pay next year because of rising health insurance costs or be forced to drop coverage for their families.

For Robert Lurker, it could be a financial disaster. Lurker, a drafting and technical graphics instructor in the School of Polytechnic Studies, said he will be forced to drop health insurance coverage for his wife as of Jan. 1 because he can't afford to pay $2,652 more in premiums. Lurker said he would be paying $3,600 a year or $300 a month to cover his wife if he continued with the insurance.

The Cape Girardeau resident said he currently pays $79 a month, or $948 a year.

The university picks up the premium cost for all of the school's approximately 1,100 employees, but employees have to pay monthly premiums if they want their families covered by health insurance and those expenses will go up in 2003.

Lurker's wife doesn't work. The couple's four children are covered by Medicaid.

Like a 6 percent cut in pay

Lurker said the increased cost of providing health coverage for his wife would have amounted to more than a 6 percent cut in his pay.

"There is no margin in our budget now," he said. "We live from paycheck to paycheck."

Economics professor Terry Sutton said it's difficult for families to survive on a single income, partly because of rising health insurance costs. "Nowadays, pretty much both adult members of a family have to work," he said.

Southeast employees didn't get a pay raise this year. State budget cuts prevented the university from giving pay raises except for promotions, school officials said.

Michael Dougherty, the school's personnel director, said he understands workers' financial frustrations with rising health insurance costs. "We wish we were in a position financially to do something about it," he said. "We just don't have the budget."

Southeast is one of six public colleges and universities in Missouri that are part of a self-insurance consortium. Besides Southeast, members of the Missouri State Colleges & Universities Group Insurance Consortium Inc. are Central Missouri State University, Harris-Stowe State College, Missouri Southern, Missouri Western and Truman State University.

The plan covers over 7,500 employees, retirees and dependents, including 4,200 employees at the six schools.

Health system in red

But the health insurance system is expected to go in the red this year, with claim expenses exceeding income by at least $2 million and possibly as much as $3 million, Dougherty said.

"Drug expenses have just shot up," he said. "Medical inflation and drug inflation have created problems not only for our plan, but everybody's plan."

To combat the problem, insurance coverage will be reduced to a single plan rather than three different plans now offered through the consortium.

For full family coverage, a Southeast employee will pay $490 a month beginning Jan. 1, a $45-a-month increase for those already carrying such coverage under the basic plan now used by a majority of the school's faculty and staff.

The new plan doubles the deductible to $500 and maximum out-of-pocket medical expenses from $1,000 to $2,000.

But for 140 Southeast employees, including Lurker, the increased premium cost is much larger because they have been on a plan that had a higher deductible in exchange for a lower premium cost for coverage of their spouse, children or both.

An employee in that category could be paying as much as $3,564 more a year for health insurance coverage for their families, Dougherty said.

Lurker said the plan will eat away at family budgets and force more spouses to get jobs or Southeast employees to look for new jobs.

"Everybody gets nailed," he said.

335-6611, extension 123

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