November 10, 1999           PRESS RELEASE

Baltimore Efficiency & Economy Foundation Receives Grant to Research Rising City Health Care Benefit Costs
Goldseker Foundation & City to Jointly Fund Major Study

Baltimore, MD -The Baltimore Efficiency & Economy Foundation (BEEF) announces that it will initiate a $100,000 research project to analyze the costs of health care benefits and prescription drugs provided to Baltimore City employees and retirees. A $50,000 grant from the Goldseker Foundation matched by the City of Baltimore will fund the study.
          "The annual exponential rise in City costs for health care and prescription drugs for City employees and retirees is a major threat to the future financial stability of Baltimore City," said George A. Nilson, president of BEEF, the newly formed Baltimore Efficiency & Economy Foundation. "The $50,000 grant from the Goldseker Foundation and matching City appropriation will enable us to apply expert health benefit research to a very pressing problem."
          The Baltimore City FY 2000 budget reveals an annual wage expense of $537.7 million for the City's full time workforce of 16,000 people. This year, the City will spend $100 million for employee and retiree health care benefits. In addition, it spends $44.9 million for prescription drug costs alone. The costs are explained, in part, by the fact that in public sector employment, more than in the private sector, the health benefits package represents a more significant portion of an employee's total compensation.
          The BEEF study will compare Baltimore's health care benefits package, in terms of costs and benefits, to the benefits packages and wages of other public and private employers in the region. Retiree benefits will be similarly compared. Where elements of Baltimore's costs are found to be disproportionately high, the study will identify the areas where the City might consider (a) modifying benefits, or (b) changing its program or how it administers its program to reduce costs.
          The Baltimore Efficiency & Economy Foundation is an independent nonprofit, nonpartisan organization which will be directing research on various aspects of City management, operations, fiscal and tax policy. BEEF's research reports will be disseminated for public information and discussion to help establish a bridge between citizens and local government. The name of the Baltimore Efficiency & Economy Foundation was inspired by an impressive 47-year record of Baltimore's Governmental Commission on Efficiency & Economy which conducted research on the operations of Baltimore City from 1928 to 1975.



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