Guinn to support restoring benefits to public employees

Monday, Jan. 10, 2005 | 9:30 a.m.

CARSON CITY -- Gov. Kenny Guinn is mum about whether he is going to recommend a pay raise for state workers, but he intends to back a plan to restore benefits in the health insurance program for employees.

The Public Employees Benefit Program has recommended in its budget to put back in some of the items that were reduced when the insurance program was in financial trouble.

Guinn said this won't be in his "State of the State" message but "I'm going to let them do it" in his budget.

The governor said Friday he thought the fund was financially "safe" now and praised the board of director and staff for getting the system back on an even keel.

Guinn specifically mentioned the "high deductible" that workers must pay before the policy payments kick in. It was raised from $250 to a minimum $500 when the program was near bankruptcy.

Forrest "Woody" Thorne, executive director, said the program is recommending that the deductible be lowered to $250 and that dental benefits be expanded from the present two teeth cleanings a year to four plus raising the amount paid.

The program presently provides coverage for an eye examination and Thorne said it is recommending add coverage for glasses and frames. It is also examining expanding the coverage for prescription drugs, he said.

The program doesn't intend to dip into its reserves but Thorne said it is recommending a "modest" increase in premiums.

The plan covers an estimated 55,000 individuals, including state workers, their dependents, retirees and some employees of local government.

Scott MacKenzie, executive director of the State of Nevada Employees Association, said "The performance of the fund has improved. There is no reason why the employees should not benefit."

His association, MacKenzie said, has been closely monitoring the insurance program and he added he was happy to hear the governor has confirmed he will back the restoration of benefits. The big problem, he said was the high deductible that was once at $250.

When the benefit reductions were made in the 2003-2004 fiscal year, employees were given a choice of deductibles of a $500, $1,000 or $2,500.

The state pays a monthly premium of $558 for each state employee, a 12.6 percent increase from the last 2004 fiscal year. That provides 100 percent coverage for the employee and about 60 percent of the cost of depending coverage with the worker contributing the remaining 40 percent. The state also contributes $316 a month towards the insurance for each retiree.

The Legislature appropriated $457.1 million over the present biennium to cover the cost of the premiums, according to the Nevada Legislative Appropriations report.

The 1999 Legislature had to pump an additional $23 million into the insurance plan to keep it afloat. And the special legislative session in 2002 had to appropriate another $18 million to keep it solvent.

Last November the system reported a major turnaround of $46 million. It went from a $15 million deficit for fiscal year 2003 to $32 million in the black at the end of the fiscal year ending June 30, 2004.

A cut in benefits saved $9 million and there were fewer claims of more than $10,000. In addition the members used the system less.