Proposal would up U employee health care payments

by Lee Billings

University faculty and staff said they are upset about a new administrative proposal to increase University employees’ health care co-payments and premiums.

Phyllis Walker, president of AFSCME Local 3800, a union representing 1,800 University clerical workers, said the proposed changes could cause “great harm” to lower-income workers.

“Their salaries are already below a living wage and if you raise their health care costs you’re going to make them choose between buying food, paying the light bill or going to the doctor,” Walker said.

AFSCME, along with other workers’ unions, will begin collective bargaining with the University administration once the advisory committee has made its recommendations.

“I’m anxious to get into contract negotiations and to discuss how we can (assist lower-income workers), but these will be difficult negotiations if we’re expected to have pay freezes and increases in health care costs, because that boils down to a pay cut for us,” said Sue Mauren, a representative of approximately 1,500 University employees in Teamsters Local 320.

Mauren expressed solidarity with the administration over the current crisis, faulting Gov. Tim Pawlenty’s budget plan instead.

“This is the fault of a governor who doesn’t care about higher education or health care,” Mauren said.

Pawlenty recommended cutting $185 million in state funding to the University for the next two years. The cut is part of his plan to balance the state’s estimated $4.2 billion deficit.

Fred Morrison, Benefits Advisory Committee chairman and law professor, said he does not like having to recommend the increases but that it is the best option.

“The alternative is really closing departments or colleges and very substantial layoffs,” Morrison said.

At the committee’s morning meeting, University President Robert Bruininks and Frank Cerra, senior vice president of the Academic Health Center, made the case for the University’s health plan changes.

“We have to save some money here, or every million dollars we don’t save, we’ll have to lay off 17 to 20 people,” Bruininks said.

Committee members said they are aware of problems the proposed changes would cause for lower-income employees.

Dick McGehee, a University math professor, said the changes could increase insurance premiums $1,000 per year for each University employee. That increase could significantly impact lower-income employees, he said.

“It’s a much smaller percentage of someone’s salary who makes $100,000 (per year),” McGehee said.

Cerra said the University’s current health care plan is “out of line” with benchmarks from other Big Ten schools and the public and private sectors.

“Our medical plan four years ago was way up at the top of the Big Ten health insurance offered to its employees and was way beyond what went in the private sector and way beyond what went in much of the public sector,” Cerra said.

Double-digit co-payment increases, raised maximum out-of-pocket payments, longer waiting periods and standardized prescriptions are all features of the proposal, which also suggests removing the University of Minnesota Physicians’ Care System from the HealthPartner Classic division of University insurance.

Cerra said he does not believe the proposed changes will make the University less competitive in acquiring and retaining faculty because “we’ll be coming into line with the other schools.”

Morrison and other University employees said the changes would harm the University’s ability to recruit and retain faculty.

“We have always had a benefits program that helped offset the fact that our salaries are in many cases far below the market,” Morrison said. “We had a better benefits program and a below-average salary program.”

Lee Billings covers faculty and staff affairs and welcomes comments at

[email protected]