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Editorial Cartoon: Alabama and IVF
Editorial Cartoon: Alabama and IVF
Published March 1, 2024

Regents discuss health plans

University employees might soon find themselves under a new health benefit plan.

After researching alternatives to the State Employee Group Insurance Plan – the University’s current health care plan – University officials are days away from deciding whether or not to move to a self-insured system through a private provider.

On Wednesday, the Board of Regents held a special meeting to discuss possible employee health benefit plan options.

“All of us are concerned about health benefits, their cost, having to change doctors and clinics and the services the plans provide,” said Frank Cerra, senior vice president for the Academic Health Center.

“But what happens in the health care marketplace we respond to and do not control,” he said.

Cerra said inflation in the health care marketplace is only one reason the University began its search for a new health benefits provider.

“In a self-insured system, the University could provide employee health care benefits which tailor to the expressed needs of University employees,” Cerra said.

In December 2000, a University Health Plan Task Force was established to survey which health benefits University employees desire most.

Their work was paralleled by the Administrative Working Group, which issued a Request for Proposal to stimulate competition between businesses interested in providing the University with coverage.

The RFP resulted in six responses from providers and a variety of health benefit plans. After analyzing the options, members of the AWG developed four possibilities for employee health benefit plans: limited HMO, traditional HMO, a point-of-service plan and a nontraditional option.

A fifth plan was added to the list after the state’s Department of Employee Relations, which administers the SEGIP system, submitted an outline on May 18. The DOER proposed continuing its relationship with the University.

Before contacting the University in May, SEGIP said maintaining the same employee health care benefits would require premium increases of 18 percent to 20 percent during the next two years.

While the DOER plan is still being negotiated, University President Mark Yudof questioned why DOER came forward at the last minute and stressed the importance of getting a written contract with SEGIP.

“Why wasn’t this plan there before? It’s like the midnight appointment of the judges. People worry we’ll be taken for a ride,” Yudof said.

Response to the four plans was mixed at the meeting, as representatives from various groups expressed doubts about some of the health care options.

“The process of which way to go has been very troubling for us. Continuity of care is of primary importance,” said Linda Fisher, a member of the Academic Staff Advisory Committee.

“Each time you have to find a new doctor it is not a savings to anyone,” she said.

Gladys McKenzie, a member of a union for University clerical and technical workers, questioned the financial burden a new plan might put upon University employees.

“Isn’t it wrong for the U to place further burden on the U’s employees? What is the U’s message? To add co-pays and deductibles to budgets that are already stretched?” McKenzie asked.

Yudof and Vice President for Human Resources Carol Carrier said the consequences of changing health benefit plans will be heavily weighed before a decision is made.

“We’re not going to be raising the cost of health care for people who only make $11 or $12 an hour. It’s not right and it’s not fair,” Yudof said.

“We’ll look at the impact the cost will have on our lower income employees and consider strategies to mitigate that,” Carrier added.

The University currently pays $73 million per year for employee health benefits, covering 90.5 percent of the total cost.

While exact cost figures for the plan options are incomplete, the University plans to pay 86.2 percent of the total cost of a new plan, leaving employees responsible for 13.8 percent.

The University has received health care benefits for its employees through SEGIP since the 1960s. The University pays a premium to the state for each employee and the state then contracts with health benefit plans. The health benefit plans in turn contract with care systems, individual clinics and other facilities to provide medical care.


– For more information on plan options visit

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