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State finance chief says raise employees' insurance rates

MONTGOMERY (AP) — Health insurance premiums paid by Alabama teachers and other public employees are lower than the national average, according to a recent study. But if the state finance director has his way, they will be going up.

State Finance Director Jim Main said he would like to see Alabama's public employees pay more for health insurance.

His reason: The state's cost of providing health insurance for about 209,000 public employees and retirees is expected to reach $1.31 billion this year, an increase of 81 percent in five years.

"I certainly think we're going to have to look at sharing a little bit more of the burden of the good insurance that we have," said Main, who is Gov. Bob Riley's top budget adviser.

Paul Hubbert, executive secretary of the Alabama Education Association teachers' lobby, and Mac McArthur, executive director of the Alabama State Employees Association, said they are opposed to an increase in the amount the public employees pay for health insurance.

Hubbert said the only way AEA would go along with an increase is if it is accompanied by a pay raise that would more than offset the rate hike.

"It would be a salary cut if you raised costs without increasing pay," Hubbert said.

Benefits a draw

McArthur said state jobs generally pay less than comparable jobs in the private sector, but state jobs offer better benefits and retirement. If state workers had to pay more for their insurance, that would make state jobs less attractive, he said.

"I really think it would be bad policy in keeping and attracting new state employees," he told The Birmingham News in a story Monday.

Teachers and other employees of public schools and two-year colleges who don't use tobacco pay health insurance premiums of $24 a year for single coverage and $1,608 a year for family coverage. A surcharge of $264 per year is added if an employee or covered spouse uses tobacco.

Employees of non-education state agencies who don't use tobacco pay nothing in premiums for single coverage and $2,160 a year for family coverage. A $264-per-year surcharge for tobacco use also applies.

For workers nationwide, the average annual premiums employees paid this spring for employer-sponsored health insurance were $694 for single coverage and $3,281 for family coverage, according to The Kaiser Family Foundation in Menlo Park, Calif., and the Health Research and Educational Trust in Chicago, an affiliate of the American Hospital Association.

The survey, released last month, reviewed health insurance plans offered by private and public employers nationwide. It did not report on surcharges for tobacco use.

For employees in Alabama's public schools and two-year colleges, the difference amounts to $1,673 for family coverage. For employees of non-education programs, such as prisons, state troopers and transportation, the difference is $1,121 in family coverage.

"I think it's time for a premium increase for the employees," Main said.

——

Information from: The Birmingham News

Copyright 2005 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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