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Bizarre decisions are coming from two key state regulatory panels — the Public Service Commission and the Health Services Cost Review Commission.

Instead of encouraging innovation and cost savings, these regulators are rejecting creative approaches that would make Maryland the envy of other states and provide big potential benefits to consumers.

Baffling is the best way to assess these moves.

The PSC rebuffed efforts to give consumers of the state's biggest power company high-tech meters to measure electric consumption. This was a blow to the Obama administration's energy policies, designed to stem costly and profligate overuse of electric power.

Rejection by the PSC also jeopardizes a $200 million federal stimulus grant to establish this cutting-edge metering system in central Maryland. It is a dreadfully shortsighted decision.

Meanwhile, the Health Services Cost Review Commission, which sets hospital rates in Maryland, spurned an initiative agreed to by hospitals, insurance companies and the state health secretary aimed at cutting unnecessary readmissions by a substantial 10 percent.

To add further insult, the panel ignored a sensible staff recommendation that fine-tuned this initiative and made it much more workable.

As a result, Maryland has turned its back on a $30 million cost-cutting measure. The hospital rate-setting panel offered no alternative to reduce readmissions and no good reason why the proposal, as amended by its own staff, should not go forward.

These actions raise questions about the judgment of Gov. Martin O'Malley in his commission appointments. Did he fail to select the right regulators? This could become an election issue.

Four years ago, O'Malley harshly condemned then-Gov. Bob Ehrlich's appointments to the PSC and subsequent actions by Ehrlich's commissioners.

Now O'Malley could be open to criticism from Republican challenger Ehrlich on similar grounds.

O'Malley's PSC nearly killed a French power company's $4.5 billion investment in Constellation Energy's nuclear power plants, including a new one scheduled to be built at Calvert Cliffs.

Now that same PSC is blocking a major energy-efficiency and cost-saving initiative that 26 other utilities across the country already have adopted. O'Malley's PSC seems unable to comprehend the usefulness to consumers of fast-moving technology advances.

At the same time, O'Malley's Health Services Cost Review Commission is becoming a major impediment to lowering health care costs in ways that ensure the financial stability of Maryland hospitals — the state's biggest growth industry.

Hospitals are struggling to survive the recession while also preparing for a huge influx of patients under the Obama administration's new health care law. The cost review commission's refusal to embrace a consensus plan designed to reduce needless readmissions is a puzzling misstep. The problem will only grow worse as more patients become eligible for health insurance.

Fortunately, both commissions get a second chance — what golfers call a mulligan.

BGE this week submitted an amended smart meter proposal in hopes the PSC will reverse its early decision before month's end and save the $200 million federal stimulus grant.

On Wednesday, the PSC said it would hold hearings Aug. 5 and 6 on the latest metering plan, but the panel still could take its time announcing a decision. That alone might be enough to kill hopes for retaining the large federal grant.

In its modified proposal, BGE tries to meet the PSC's earlier objections. It also slashed a proposed surcharge by 75 percent, a move it claims will save customers $160 million over the life of the program.

It remains a forward-looking approach that lets residents closely follow their electricity usage and then take steps on their own to lower power consumption and save money. This could result in a potential annual savings of $100 or more for each of BGE's 1 million customers in central Maryland.

As for the hospital rate-setting commission, it has decided to revisit the cost-saving plan it rejected this month in October or November. By then, these regulators should be well enough briefed and educated on the specifics to reach a more sensible conclusion.

Maryland has the highest hospital readmission rate for Medicare patients of any state in the country. That is unacceptable.

Nationwide, unplanned readmissions cost $17.4 billion, or $7,200 for each patient returning to the hospital within 30 days.

Sometimes patients are released too soon or aren't checked for hospital-acquired infections before discharge. More often, hospitals don't keep in touch with discharged patients to make sure they are taking their medications or sticking to prescribed treatment regimens.

In their proposal to the Health Services Cost Review Commission, Maryland hospitals sought a slightly higher rate increase so they could put in place better care-management and infection-prevention programs. They expected to cut needless readmissions at least 10 percent.

That offer should not have been rebuffed. After all, the state's main protagonists on hospital rate-setting issues were in alignment on this plan, as was the governor's health secretary.

Plus, the cost review commission's staff had tweaked the plan so it would reward only hospitals that do a good job reducing readmissions. That's a far more enticing incentive for hospitals than the original plan, which was based on achieving a statewide reduction of 10 percent.

These initiatives offered Marylanders great value: more efficient energy conservation and more effective health care. Both plans promised monetary savings for consumers and an improved quality of life.

But O'Malley's regulators weren't listening, which could pose a problem for him in November.

Barry Rascovar is a State House columnist and communications consultant. His e-mail address is brascovar@hotmail.com.