New London - Alec Peterson wasn't prepared for what awaited him in Thursday's mail.

It was a letter informing him that his monthly Charter Oak Health Plan premium was about to go up by 45 percent - starting with a payment due in little more than two weeks.

"My problem is that there was no warning," said Peterson, an unemployed Riverview Avenue resident who lives alone. "I don't care who you are, if milk were to go up to six dollars a gallon tomorrow, or if your electric bill went up 50 percent overnight, there'd be rioting in the streets."

Peterson said Charter Oak premiums - his are climbing from $307 to $446 - are due the 15th day of the previous month, meaning September's payment is due Aug. 15, which is two weeks from Monday. That's hardly enough time for him to determine whether he'd be better off uninsured.

The short notice, it turns out, is not Peterson's only problem.

"It's an unconscionable increase foisted on those least able to afford it," Peterson said. "I find it reprehensible."

The 50-year-old Peterson, who described himself as reasonably healthy, said there's not much in the way of alternatives.

"I'd have to purchase a plan from a private carrier who'd charge in excess of $1,000 a month, or go uninsured," he said. "What income I do have would disqualify me for Medicare or Medicaid."

It's a close call, he said, whether it would make more sense for him to forgo health coverage and simply pay the full shot for his doctor's visits and the few prescriptions he takes and to rely on a hospital emergency room in the event of a serious illness or injury.

"I'm being forced to gamble my financial well-being versus my physical well-being," Peterson said.

Such a dilemma is the very thing former Gov. M. Jodi Rell hoped to eradicate when she championed the Charter Oak Health Plan as affordable health coverage for Connecticut residents who had no access to coverage through their employer or who were temporarily unemployed. The plan also targeted young college graduates and early retirees with limited incomes.

The program currently serves about 9,700 previously uninsured adults under the age of 65, according to the state Department of Social Services, a comedown from the peak enrollment of about 15,000. There is no income limit.

Enrollee costs are increasing because of a reduction in subsidy levels for those eligible for subsidies and because of overall increases in the medical costs incurred by the program, David Dearborn, a department spokesman, said Friday in an email exchange. Since the program's inception in 2008, Charter Oak has generally attracted an older population with more chronic healthcare conditions than originally anticipated, Dearborn said.

The monthly premium is rising from $307 to $446 for all enrollees who joined the program on or after June 1, 2010, a group that's not eligible for premium subsidies. The roughly 4,700 members who joined Charter Oak before June 1, 2010, and who are eligible for reduced subsidies based on income levels face higher premiums, too, from the current range of $129 to $296 to a new range of $215 to $369.

An additional 900 enrollees who joined the program before June 1, 2010, are ineligible for reduced premiums because their income is more than 300 percent of the federal poverty level.

On the plus side, an annual cap of $100,000 worth of benefits is being rescinded, as are a $7,500 cap on annual drug prescription costs and a $4,000 cap on annual medical equipment costs.

Peterson, who worked for 30 years as general manager of a succession of automotive dealerships, including Falvey's and Hoffman Audi in New London and Mike's Famous Harley-Davidson of Groton, was laid off in January 2009.

He's been living on unemployment benefits, and obtained COBRA extended health benefits up until April 2010, when he signed on with the Charter Oak Health Plan. He chose a plan administered by United Healthcare, one of three offered by Charter Oak.

"I made good money for 30 years, which got me to thinking about some of the other people on this plan," he said. "I'm fortunate that I'm capable of researching what's in my best interest. Based on the calls I made yesterday, going with a private carrier would cost me between $900 and $1,400 a month in premiums.

"With the way health care and Obamacare have been in the news and now this, I've got to ask, 'Is this what we can expect of government-managed health care?"

b.hallenbeck@theday.com