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Health Care: Why You Should Care

Rising health care costs are taking a bite out of your paycheck and your district's fund for school needs. Here's a prescription for bringing costs in line. . .

Last summer, doctors in Louisville implanted a hard plastic and titanium replacement heart in a middle-aged male. A disturbing sign of the times: While trumpeting this great advance, the hospital refused to "discuss reimbursement for the patient's care" with reporters.

The rising cost of health insurance is a touchy issue for those who provide health care?and a non-issue for too many who receive it.

Al Dobson, who helps NEA and its state affiliates negotiate the landmine issues surrounding health care, concludes that while Americans want the best care, in general they don't want to pay for it.

"In principle, people think health insurance cost control is a laudable goal, but not for them," says Dobson. "Cost control is a perfectly wonderful idea until you, or someone you love, gets sick. Then you want as much health care as you can possibly get from the best hospitals and best physicians. People don't want their care controlled."

That's a big problem, Dobson notes, because health insurance costs?and hence premiums?are likely to rise faster than wages over the next

10 years. Two costs alone, technology and prescription drugs, could ensure that.

The rising price of health care hits home when school districts and their employees try to figure out how they'll spend resources, says Stan Wisniewski, head of NEA's Office of Compensation and Collective Bargaining.

"Sometimes districts cope by cutting coverage or other benefits in existing insurance plans," he says. The result can be cuts in coverage for education employees and/or their family members, higher co-pays on drugs and office visits, or restricted choice of health care providers.

And, sadly, each nickel spent on health care insurance is a nickel the school district can't spend on textbooks, computers, or salaries.

How can we as an Association work to reduce or moderate health care increases? Here's some advice from the Association experts:

1. Build strength through numbers. One good strategy for combating rising health care costs is building the size of the insured pool.

If you're in a plan with a small number of other school employees, chances are excellent that your premiums and other costs associated with health insurance run higher than those paid by participants in larger plans.

Across the United States, hundreds of relatively small school districts?from fewer than 100 up to 400 employees?try to negotiate health care insurance with multibillion-dollar insurance companies.

The result: a high degree of disparity among types of coverage offered to employees in those districts. Too often, educators may be getting different costs and benefits from the same insurance carriers.

To build health care buying power, more and more NEA state affiliate leaders and elected officials are investigating statewide insurance plans for school-related employees. Some states, such as Alabama, Kentucky, Maine and New Jersey, already have such plans.

In Kentucky and New Jersey, public education employees comprise only one part of a larger state employee purchasing pool. The Alabama and Maine programs purchase health care benefits only for persons employed in public education.

But every state's different. Idaho's major insurance plan covers 90 of the state's 112 school districts. But the largest Idaho districts have their own plans, leaving only about half of the state's school employees in the big pool.

Consequently, Idaho health care insurance costs last year rose from 15 percent in some districts to 50 percent in others. This year, increases were smaller, but still significant at 10 to 20 percent.

Says Idaho Education Association Executive Director Jim Shackelford: "The pressure on our leaders, administrators, and school boards to make hard choices between reducing benefits or increasing salaries is just extraordinary. And what's so hard is there's no promise of any major change in sight."

2. Build health care coalitions. "This problem is not something we can solve all by ourselves," points out Shackelford.

"The good thing is school boards and superintendents have exactly the same interests in this area as we do," he adds. "This process is all about building relationships among administrations, school boards and teacher leaders. We've also received tremendous help from NEA in sorting out our situation and identifying options."

Lynn Ohman, NEA director of Collective Bargaining and Member Advocacy, also knows the value of everyone working together. She participated in a joint NEA-American Federation of Teachers health care conference this spring in Washington, D.C.

"Negotiators, government relations staff and local leaders from 33 states met with national experts to learn about up-to-date health insurance purchasing strategies," Ohman reports. "By working together, NEA and AFT created the potential for more overall progress in negotiating health care benefits for education."

Ohio Education Association staffer Gregg Gascon adds: "The control of health care costs is a collaborative effort. Labor and management need to understand the full consequences of the fact that as health insurance premiums increase, wages tend to decrease. After all, you don't retire on your insurance, but on your final average salary."

3. Educate both NEA members and administrators. Many NEA state affiliates understand the widespread lack of public information on the intricacies of health care.

The Idaho Education Association, for one, is planning a series of annual health care forums, aimed at school district insurance committee members who bear much of the responsibility for finding the best insurance plans. These people, drawn from both Association and administrator ranks, advise bargaining teams on monitoring claims and usage, and encourage colleagues to use health care policies wisely.

According to IEA's Shackelford, an important part of this training will be on reading information provided by insurance companies. Insurance committee members can then try to make sense of how coverage needs to be changed?and can consider the implications of changing insurance companies.

You can teach yourself more about your own health plan by reading and understanding its coverage. Plans vary dramatically.

And don't forget to check your hospital bill. Double billings and charges for services not provided are common. Some insurance companies offer cash rewards to patients who find errors in their bills.

Finally, be alert to medical developments that may have significant implications for you and others in your insurance pool, such as the proposed Patients' Bill of Rights, now pending in Congress.

For more background on health care, visit these Web sites:

• www.census.gov/hhes/www/hlthins.html
  
• www.ncqa.org/
  
• www.aflcio.org/healthcare/
  
• www.nchc.org/
  
• www.facct.org
  
• www.familiesusa.org.

Seminar Scheduled

This spring, NEA and the American Federation of Teachers jointly sponsored a health care seminar for bargainers and lobbyists. Due to tremendous response from participants, the seminar will be offered again, on October 10-11 in San Diego, California. The meeting will be preceded by a "health care basics" session on October 9.

For registration information, go to www.aft.org/research/hot_news/NEAft/ index.htm.

Factors Behind Health Cost Increases

Why are health insurance premiums increasing so swiftly? Many factors contribute, some of which have been around for years. Others have arisen with new developments in the practice of medicine and patients' care expectations. Here's a partial list:

Old cost drivers:

• Consumer demands
  
• Oversupply of beds/specialists
  
• Poor quality medical care
  
• High administrative costs
  
• Fraud and abuse

New cost drivers:

• Pressure on health plan profitability
  
• Emerging medical technology
  
• Pharmaceutical costs and utilization
  
• Consumer demands
  
• Managed care reform

An Unhealthy Situation for ESP

For too many education support professionals, health care costs are painful and just plain shameful.

Ohio Education Association Labor Relations Consultant Ann Field, who works with a consortium of 11 northern Ohio districts, notes that many of the region's part-time ESPs take their jobs simply to gain access to their district's health care plan.

Unfortunately, costs have risen so dramatically over the last couple of years that some employees, primarily cafeteria workers earning about $7 per hour, actually end up owing their district money at the end of the month.

"Their premiums went from $428 per month last year for family coverage to $738 this year, and they're looking at another 30 percent increase soon," Field says.

"These employees aren't making enough money to pay the premium," she notes. "The different districts have the same plans but different caps on how much the districts will pay. At the end of the pay period, some end up owing the school money."

Field does not know what will happen next. Even if ESP bargain a 3 or 4 percent salary increase, that won't make up for another hit in their health premiums.