Lawmakers may discuss insurance

Monday, July 29, 2002 | 11:13 a.m.

CARSON CITY -- A plan to rescue the financially troubled program that provides insurance to state workers and their dependents may be included at the special session of the Nevada Legislature that convenes today.

Gov. Kenny Guinn, who sets the agenda of the special session, is looking at the possibility of asking the Legislature to pump more money into the program to avoid major cuts in benefits. Guinn's press secretary Greg Bortolin said Sunday that the governor's top priority is dealing with the medical malpractice issue. "The state health is the next priority," Bortolin said.

The Public Employees Benefits Program provides coverage for about 55,000 state workers, their dependents, retirees and some local government retired employees.

Forrest Thorne, executive director of the insurance system, said it would need about $15 million by next January to avoid major reductions in benefits. The $15 million could carry it through until July 2003.

The state contributes $384 per month this fiscal year for each employee who must pay the premium for dependents.

The system has experienced higher than expected claims and expenses since the close of the 2001 Legislature.

Part of the problem was because of Guinn's budget. He recommended and the Legislature accepted that the state reduce its contribution from $368 per month fiscal year 2001 to $357 or a 3.1 percent decrease in fiscal 2002 which closed last June 30.

His decision came in spite of recommendations from the former executives in the insurance system that they needed more money to keep from going broke during the biennium.

Thorne, who took over after the 2001 Legislature, said he has been keeping the governor informed of the financial plight of the system but he has not asked him to include it on the agenda.

The system's board at its last meeting, asked for a legal opinion whether it could petition the Legislative Interim Finance Committee for additional funds. But the finance committee has only $4 million left in its emergency fund and it must keep a reserve during this fire season.

Thorne said he has not received a written answer yet from the attorney general's office. The system has held several public hearings and workshops to get the ideas of the members what should be done.

There have been options to eliminate dental and vision coverage. Or raise the premiums for dependents and retirees.

The 2001 Legislature appropriated $345.7 million for the 2001-2003 biennium compared to $296 million for the prior two-year period.

The board is scheduled to meet Aug. 8 and 9 to make decisions where to reduce benefits if the state does not chip in any extra money.