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Rell Vetoes Health Pool Bill

Pledges To Work On Better Plan Next Year

CHRISTOPHER KEATING

June 14, 2008

Gov. M. Jodi Rell vetoed a highly controversial "pooling" bill Friday that would have allowed municipalities and small businesses to join the state's health insurance plan — but she tempered the rejection with a pledge to work with Democrats for a better bill next year.

The measure became one of the most contentious issues at the state Capitol this year and generated a battle between state employees' unions and their longtime opponent, the Connecticut Business and Industry Association. Union leaders said the pool would be a major step forward for health care, while CBIA said it was simply the first step toward an expensive, taxpayer-supported, single-payer system.

A key problem, Rell said, was that the bill was unworkable and lacked details on the costs. The state is currently spending $1 billion per year for health care for both state employees and retirees, and those costs are projected by the state to increase to more than $2.4 billion annually by 2020. The best plan currently costs $22,000 to $24,000 per family, but those costs are offset by employee premiums.

While those joining the pool would have been entitled to the same lucrative benefits as state employees, the real costs of expanding the pool remained undetermined, Rell said.

"Any state law that impacts billions of dollars in costs and liabilities needs to be based on a firmer analytical and actuarial foundation," Rell said. "No detailed, independent and comprehensive study of the potential benefits is currently available. Yet this is exactly the kind of information we really need before moving ahead with this concept."

Union leaders and Democrats sharply criticized Rell Friday, saying she had missed a golden opportunity to improve health care in the state. At the same time, she was praised by CBIA and Republicans.

Top Democratic legislative leaders — Senate President Pro Tem Donald Williams, Senate Majority Leader Martin Looney and presumptive House Speaker Christopher Donovan — all said they would work to pass the bill next year.

"The information the governor used to reach her decision is wrong," Donovan said. "She was swayed by threats and numbers from the insurance companies and not the comprehensive analysis that we provided. I was always open to discussing the legislation with the governor, and I will work with her in the future to ease her concerns."

One of the state's largest insurers, Anthem Blue Cross and Blue Shield of North Haven, had announced that it would have been forced to increase its rates by 4 percent — or more than $24 million — for the next year if Rell signed the bill. Rell also said the bill would jeopardize $54 million in projected savings that the state expects to receive from rates negotiated with Anthem and other large insurance companies that cover state employees.

"For the governor to say 'no' to pooling shows she bought the negative hype from the Connecticut Business and Industry Association and Anthem," said Michael O'Brien, president of the Connecticut State Employees Association/SEIU Local 2001. "She should have seen through their threats to raise rates. The larger the risk pool of insured lives, the lower the rates."

Despite the veto, Rell extended an olive branch to the Democrats. State Republican Chairman Christopher Healy said the bill, which passed more than a month ago, took a circuitous route to Rell's desk because the Democratic majority that controls the legislature did not immediately transmit the bill to the governor.

"They wanted to push it from a PR perspective," Healy said. "It is a complete abomination. It is nothing more than a sop to the public-sector unions. There is zero demonstrated savings by anyone's analysis. ... It's a cherry-picking payoff to the public-sector unions."

Looney, a New Haven Democrat, said, "Friday the 13th has proven to be an unlucky day for families and small businesses in Connecticut who are struggling to pay health care costs. Gov. Rell has ignored their pleas and instead listened to the special interest groups and lobbyists, which are desperate to maintain the status quo."