Image provided by: SEIU Local 503; Salem, OR
About The Oregon public employe. (Salem, Oregon) 1981-???? | View Entire Issue (Nov. 1, 1981)
S P E C I A L R E P O R T What is BUBB Doing for State Employes? Many New Programs Brought to Employes Through Competition by Douglas Crooks Many state employes cannot give an answer when asked the purpose of the Bargaining Unit Benefits Board. Of those who do know it administers insur ance programs for over half the State’s employes, many ask, “What does BUBB do for me?” To say that BUBB has gotten state employes the best bene fits possible sounds like public relations hype. A look at the performance of this State board though, shows this heady statement to be true. Prior to BUBB’s creation in August of 1979, state em ployes had little say in the d e s ig n o f t h e ir in s u r a n c e benefits packages, nor were they allowed to use all the dollars they negotiated for these benefits. Instead, they were locked into an insurance plan designed by the man agement-dominated Oregon State E m ployees B e n e fit Board. With the formation of BUBB an atmosphere of competition was created. The result has been the offering of a far greater range of insurance programs. Under BUBB, state em ployes have: • Three times the number of free health insurance pro grams other state employes are offered, including a com prehensive family health plan at no monthly out-of-pocket premium. • The choice of health main tenance organization (HMOs) program s in 20 counties, rather than in 10 counties; • Free dependent dental ben efits; • A health plan design that keeps h o s p ita l u tiliz a tio n below the national average and thus keeps overall costs down; and • A stabilization fund, where negotiated benefit dollars that are not used to pay premiums are used in succeeding years to hold down the impact of rate increases. Prior to BUBB, these dollars stayed in the State agency budgets. In the past two years the programs offered by SEBB have also improved, but it is interesting to note that these improvements have usually been a copy of programs that BUBB had already imple mented. In fact, when SEBB asked insurance companies to bid on its plan design for 1981- 1982, Blue Cross was the only company to formally reply and they dictated changes in plan design that were virtually identical to the plan that was already being offered by BUBB. Despite its demonstrated ability to design and imple ment creative, cost-effective insurance benefit programs, BUBB’s very existence is being threatened by a Legislature that is demanding that more be done to stop the spiraling cost (continued on page 8) Addressing a Dilemma: Trade-Offs in Demands for Wages and Benefits by Chuck Mendenhall It comes as no great revela tion that health care costs have increased astronomically over the past decade. In fact, from 1965 until 1980, the total expenditures for health related services in the U.S. increased over 420 percent. Doctors* fees, hospital fees, lab fees and, at the end of the progres sion, insurance prem ium s have risen proportionately to this four-fold increase. It is obvious that costs in this area have far outstripped the rate of inflation. Less evident, but equally alarming though, is the growing problem of the fewer dollars that are available for wages as benefit costs escalate. In the 1979-1981 State budget, approximately $725 million . was earmarked for personnel expenses. In the 1981-1983 budget, that dollar figure has grown to over $1 billion. The increase in wages Annual Local, State & Federal Government Health Expenses; % of National Health Expenses *ln part, the increase in health care costs for public employes is due to the increasing numbers of federal, state and local employes. In 1965, the total number of federal, state and local employes was 10.1 million. By 1980, employes in these govern ments had increased to 16.2 million. and benefits and the balance between the two is receiving heightened attention from all impacted groups and should be of real concern to employes and to the State as well. This issue becomes much more graphic when you look closely at the current salary and benefits package between the State and OPEU. Part of the salary settlement included a flat $55 per month increase, while increases necessary to meet basic health and dental insurance needs amounted to another $95 per month. It is evident that the balance is weighted heavily toward bene fits—a trend that is almost sure to continue as insurance costs Increase. To be sure, the sharp increase in insurance costs— both to the employe and to the State—has not gone un noticed. Oregon legislators are exam ining th is issue closely and may make some significant and critical deci sions regarding state em ployes’ insurance benefits in the near future. The charge facing state employes and public sector unions is clear—they need to become absolute experts in the health care field. They must bargain strongly and then stretch negotiated bene fits in an effort to provide the best insurance value that is available. The Bargaining Unit Bene fits Board, which OPEU helped create in 1979, has four union representatives and is working hard to develop the best insurance coverage at the low est costs fo r all rep resented employes. The work of the board will not be enough though, unless state employes and their unions also make significant contributions to addressing the dilemma of rising health care costs. Mr. Mendenhall is chairman of the Bargaining Unit Benefits Board. Page 5
