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 The Politics of BCIBB Merging Contracts With Benefit Plans by Thomas Gallagher th e ir members th a t other The Bargaining Unit Bene unions do not provide, but fits Board was a dream that there is no single best possible OPEU sought during three insurance plan. Every plan is a legislative sessions. It's crea compromise of cost, design tion was one of OPEU’s and benefits. biggest legislative victories. The key to spending dollars Since the Collective Bar wisely though, is for BUBB to gaining Bill of 1973 enabled maintain one plan with a large employer contributions to pool of employes. Any union health and dental plans, that wants a separate plan unions have negotiated the would have to break their em amount of the contribution. ployes out into a smaller pool But not until BUBB did a union to share the insurance risks. In have a real say in where the all cases, the smaller the pool, money was spent. Previously, the higher the cost. under the Oregon State Em T here is no le g is la tiv e ployees Benefit Board (SEBB), directive to BUBB to break the unions’ need to know exactly group into smaller pools; the what insurance would cost increased administrative costs prior to bargaining and unions’ of additional plans, plus the need to have control over the expense of design and devel trade-off between benefits and opment, runs counter to the cost were not met. legislature’s policy of cost Adding to this unacceptable cutting. There are also many situation was the number of policy questions to be con conflicting interest groups in sidered in different plans. SEBB—excluded employes, Paramount among these is non-represented employes whether the legislature in and management service em- * tended to set up a board that ployes, as well as union could treat represented em members. BUBB was created ployes differently from agency when it became obvious that to agency. one board could not serve the BUBB is not an extension of needs of these separate any union, hot even OPEU; it is groups. a State board required to vote The goal in the 1970s was in the best interests of the clear—to gain a say in where State in providing insurance to benefit dollars were spent. But represented employes. The it was also im p o rta n t to question of separate plans for establish a second board so a different unions will be hotly m ore im p o rta n t o b je c tiv e debated in the next few could be met—to develop months. additional methods for gaining It may be that BUBB is not the maximum benefit from the best vehicle to solve the negotiated dollars. problems of negotiated in It is important to realize that surance benefits. Perhaps BUBB was created for all separate union management represented employes, not just trust funds should be set up. for OPEU. Other unions can Perhaps the directives of the join BUBB; most have stayed cu rre n t Board should be in SEBB. But AFSCME joined modified. BUBB in 1980 and other Whatever answer is devel unions are considering joining oped in fu tu re legislative BUBB. The board has con sessions, it is clear that, one— tinually said that they have no OPEU had the wisdom and objections to bringing other political skill necessary to unions under the BUBB plan begin the process of merging and at their October 1981 contract monies and benefit meeting they adopted criteria plans—and, two—OPEU wel fo r accepting other unions into comes any ideas from other BUBB. unions to improve this pro The controversies that sur cess. round BUBB and SEBB stem from one fact—all unions want Mr. Gallagher is executive to get the best possible director o f the Oregon Public insurance for their members. Employes Union and a mem There is competition among ber of the Bargaining Unit unions to provide benefits to Benefits Board. Page 6 fho pays How Much on Medical Bills Each Year*? •The average annual medical expanse was $245 per person in 1975. (This overview of statistics is compiled every five years; data for 1980 is not yet available.) SEX Male $223 Female $265 EDUCATION OF FAMILY HEAD Under 9 yrs. R E P O R T To Contain C osts Wellness Programs for Employes by Cindy Parrish In the past 15 years, insur ance costs have risen over 400 percent. This trend will con tinue during the next 10 years as anticipated medical costs skyrocket from $206 billion last year to $821 billion in 1990. State employes have been caught in this astronomical spiral. Last year their health insurance rates increased by up to 43 percent. The state agreed to pay fo r these increases this year, but next year they will pay for only an average 15 percent increase. If insurance costs for state employes are not brought down—with employes and BUBB participating in cost c o n ta in m e n t p ro g ra m s — benefits will either be cut or employes out-of-pocket ex penses will increase. In short, insurance may no longer be free to employes and their families. $200 9-11 years $222 12 years $250 Over 12 yrs. $294 PLACE OF RESIDENCE City $251 Suburb $254 Rural $226 T o he lp em p lo yes ba ttle rate Why Are Health Care Costs So High? by Chuck Mendenhall Ironically, rapidly escalating health care costs are the result of our pursuit for a better standard of living. We have applauded medical science’s ability to provide us with cures for most life-threatening mal adies, but the cost of health care has paralleled these tremendous medical achieve ments. In an outstanding panel presented at OPEU’s annual convention, Doug Welta, M.D., outlined the seven most sig nificant factors contributing to rising health care costs: the gas pump. In fact, inflation may have an even greater impact on health care than many other areas of the economy; Utilization—More people are using insurance for more reasons.* Insurance plans are o ffe rin g broader coverage (some like HMO have no deductible) and this drives up insurance rates; Malpractice— D octors fees reflect the high cost of mal practice insurance, which is increasing because of the number of suits and the size of awards; Longevity—The percentage of population over 65 years will increase from 10 percent in 1980 to approximately 20 percent to 30 percent by 1990; Physician Surplus—As more physician time becomes avail able, patients are allowed more personal contact, which can result in higher fees; and Technology and Research— The cost for new medical equipment and the ability to perform long and complicated surgery will continue to have a profound impact on insurance rates; Indigent Care— Doctors and hospitals lose m illio n s of dollars annually in fees they are unable to collect. Their losses are passed on to premium payers in the form of higher fees. In flatio n — In fla tio n is n ot unique to the supermarket or Few of us would either red ire ct d ollars spent fo r i medical care or dispute the I need for medical advances made through research and development. Even so, there are two questions each of us must face—how much longer can we afford spiraling health care costs and what can we do about containing these costs? The Oregon Legislature is keenly interested in these two questions. Two members of the leg islative Ways and Means Committee—Rep. Vera Katz and Sen. Tony Meeker— outlined several concepts that need to be explored. “ Currently, insurance plans offer very few incentives to encourage wellness,” Katz said. “ In fact, many insurance plans encourage overuse and this drives up costs.” Meeker concurred with Katz’ assessment and added that incentives and controls for I acountability must be imple mented throughout the entire insurance industry in addition | to insurance plan design. The primary problem is that i there is no coordinated effort to keep costs under control,” Meeker said. “ Doctors, hos pitals' insurance companies and policy holders all point the finger of guilt at one another.” Katz and Meeker both stres sed that the legislature, the B a rg a in in g U n it B e n e fits Board, OPEU and each state employe needs to evaluate the medical cost dilemma and be willing to participate in a coordinated effort to get a handle on rising health care costs. Some areas of reform and concepts that Dr. Walta enum erated are beyond our scope and need to be addressed at the federal level. But he did p o in t out tw o s ig n ific a n t concepts that can be ad dressed by BUBB, public employe unions and state employes: Design insurance plans that provide positive incentives for wellness; and Implement ongoing par ticipatory programs for health fitness and preventative medi cine. increases, BUBB has made a major commitment to cost containment. This commit ment has three integral parts— wellness programs, a reserve fund and employe education. BUBB will implement well ness programs much like a highly successful program at the Pilot Rock School District. That program, which began in 1979, is designed to improve physical fitness and nutrition and to reduce stress. The program features: • “Waistliner” lunches; • Nutrition breaks that include fruits and juices; • Bulletin boards and inform ational materials promoting fitness; and • Fitness programs, district intramural programs and com munity sports programs. Among the many benefits that the Seaside program has produced are a considerable reduction in the number of employes who are overweight, a significant decrease in sick leave, a demonstrated willing ness by management to pro vide time for fitness in the workplace and the long-range potential for reduced prem iums. A reserve fund has already been established by BUBB. It w ill help offset any rate, increase above the 15 percent that the State has agreed to pay next year. The fund will total all insurance monies that OPEU negotiated with the State, but were not used to pay insurance claims. In the past, these monies stayed with the State. Employes will also need to be educated. They must be made aware of the costs of insurance and how to bring these costs down. As patients, employes only pay for six percent of their medical bills; the rest is paid by government, private insurers and charities. But who pays for government? State employes pay taxes that are used to provide the benefit programs. They pay insurance premiums that rise with the cost of health care and they donate to charities. Each employe has a direct stake in the cost of health insurance. Our success in limiting the insurance rate spiral will only be as effective as employe participation in cost containment programs. Ms. Parrish is administrator for the Bargaining Unit Benefits Board. Participate in Wellness Programs Mr. Mendenhall is chairman of The Bargaining Unit Bene fits Board is looking for people who are interest in helping establish wellness programs in their work areas or in distrib uting health care information to fellow employes. the Bargaining Unit Benefits Board. Cindy Parrish, administrator for the BUBB board, is compil ing a list of work-area contacts to help in establishing these programs. If you are inter ested, contact Parrish at 373- 1174 in Salem or 1-800-452- 7813 toll free or write her at BUBB, P.O. Box 12159, Salem, OR 97309. Page 7
