Tuesday, May 06, 2014

Breaking...(updated to include leaked memo)

Update: A UFT source tells me the memo below is not part of any agreement, but rather a proposal from the city. This source tells me that it constitutes no part of the actual agreement.

A leaked memo, now posted below, suggests we may be making contributions to health care of up to 2% of salary. This would apply to anyone earning over 60k. It starts at 30-40k at 0.5%. This directly contradicts things we've been hearing.

From Harris Lirtzman:

Am getting messages that Point 4 of a highly technical summary of the proposed changes to the municipal health care plan included in the proposed UFT contract and approved yesterday by the Municipal Labor Council appears to require that an RFP be issuedon July 1 for new plans to be implemented on July 1, 2015 (Michael Bloomberg had planned to issue such an RFP but the plan was halted after the Municipal Labor Council got a court ruling overturning plans to release it) and that Point 10 allows for employee contributions to health care coverage starting at .5% of salary for members earning between $30,000 and $40,000, 1% of salary between $40,000 and $50,000, 1.5% of salary between $50,000 and $60,000 and 2% of salary above $60,000.

If any of this is true (and the paper is in many peoples' hands right now) and any of it is actually put into effect it constitutes a direct and bad faith representation by our leadership about what this contract settlement really includes.

Related: James Eterno has finally read the MOA, you know, the one the UFT Contract Committee and UFT Executive Board voted up sight unseen, and he says it does not bode well for ATR teachers. 

Update: Memo we received is below. If it proves accurate, it will mean that there is indeed a cost for members for the much ballyhooed health savings. Note point 4, and particularly point 10, which is highlighted:

NYC Projected Health Savings

y Potential Program Changes- Description and Effective Date

1.    DEVA{effective 1011114)

•   Savings  estimate  of $1OOM based on dependents at a savings of $2,000 per dependent.

•   Savings  are based on premium  reductions (20,443 family contracts moving  to individual).

•   Average savings per contract  converted to individual  (from family) $8,546.

2.     Equalization (effective  7/l/14)

•   There would be no payment  for FY '15  but the FY '14  payment  would still be made in May 2015.

•   Eliminates payment  equal  to difference between  the HIP HMO premium  rates and the CBP (GHI/Empire)

rates for the CBP enrollment.
•   Eliminate  all future payments to Stabilization Fund- for example dividends will not go to SF.

•   Does not apply to Medicare  enrollees.

•   Current obligations from stabilization fund  would continue to be met through  FY'18  (est $200  mil/year).

3.    Self-Fund  (step  I  effective  1/l/15, step 2 effective  7/l/15)

•   Assuming  that a change  in funding  for GHI/Empire and to HlP HMO plans will require an RFP process, the change to self-funding'for.the'I>PO and  HMO plans will be combined  with the RFP process to market all plans and become effective 7/i/15..
•   The HMO plan will need to become an EPO plan.

•   In the interim, there will be a change  to minimum  premium  method  on the GHI CBP plan effective  7/l/14.

•   Currently, the Welfare  Fu"nds s.s::lf-fund their prescription drugs and other health benefits  through  the

Welfare Funds, and'the elf-funded PICA program  are co-administered with the unions.

•   Assets will be set aside to fund  Incurred-But-Not-Reported (IBNR)  claims and therefore,  there will be no un-funded  liability.
•   Union concerns re ability to pay extraordinarily large claims  will be addressed.

•   There will be an annual  allocation/budgetary review.

4. Market all plans (including HIP HMO) (New plans effective 7/1/15

Release RFP 7/1/14

•   Applies to all plans currently  available to Actives and Pre-65 Retirees

•   Process will include an effort to minimize  member disruption (i.e., members  whose  PCP is not in the new network).
•   The City has the right to contract.

•   Regular market checks  and required  RPFs every 3 to 5 years.

5.     Medicare  to Medicare  Advantage {effective 1/l/16)

•   Members covered  by GHI Senior  Care (or another  Medicare  wrap-around plan) will be converted  to a

Medicare  Advantage Plan.
•   There will be no impact to members  from this change;  plan design and network  will be similar or better.

6.    Buy-Up Contributions {effective  7/1/15)

•   Applied to Actives and pre-65 Retirees.

•   Assumes  NYC contribution is the cost of the PPO plan (currently  GHI CBP/Empire). Members would have to pay the difference in costs ifthey elect a higher cost plan.
•   Going forward, new entrants  will only be allowed  to join a central  PPO plan offered to City members.

•   By doing market checks and RFPs, we hope to reduce the buy-up costs of those still on the exotic plans.

•   This does not apply to retirees.

7.    More Effective Delivery ofHealthcare

•  The City will require certain  types of non-emergency care to be subject  to case management:  For example,  to avoid Emergency  Room utilization,the City would incent members through  plan design to use Minute Clinics,  Urgent Care Facilities,  Nurselines, etc.
•   This does not apply to retirees.

Consolidate Rx  Purchasing {effective 111115)                     

I (_/  •  City will sponsor  a centralized Prescription Drug program, administered by a PBM, to provide drug coverage  to the City's members.
•   Each union will have the ability  to purchase  that plan for their membership.

•   This provides savings  to Welfare funds but no savings  to City.

•   This does not apply to ret jrees.   .-

9.   ACA Provisions{effective 111/15)

•   Adopting  ACA provisions would affect the Women's Preventive  Health Services,  including the availability  of contraceptives.
•   Adopting ACA prqvisions would also include the calculation of maximum out-of;pocket costs, after which everything is paid at 100%.   For this,City health benefits co-pays & all Welfare  Fund co-pays would need to be coordinated, as the City would  be responsible for both parts in thecalculation. There needs to be a consolidation and sharing of information going forward.
•    Other

•   This does not apply to retirees.

10.  Contributions



Contribution Percentage of Salary


$30,000  - $40,000


$40,000  - $50,000


$50,000  - $60,000




More Effective Delivery of Healthcare

 •  The City will require certain types of non-emergency care to be received at certain types

of facilities and through certain types of vendors.

The City and the Unions would agree on pre-determined facilities and organizations where members would receive thiscare.

Centers of Excellence consist of providers and facilities who specialize in a particular type of service or care andtypically produce better healthcare outcomes at more reasonable costs. Providers who provide a higher quantity ofservices will ideally have better outcomes for those services.

Centers of Excellence would be required for non-emergency services such as:

o    Cancer Treatments o    Cardiac Care

o    Knee and Hip Replacements

o    Bariatric Surgery

For Radiology and Laboratory Services, members would need to receive care at a pre­ specified location. The City wouldcontract with an organization who providers quality, low-cost Radiology and Laboratory services.

o   This would include a well-developed  pre-authorization program to avoid inappropriate use of a high-costservices.
Necessary Emergency Ca're yvolild·not be subject to these requirements.

The City will also expand Gity-owned facilities to provide care to members. This will enhance the City's hospital facili   and will provide high-quality, lower-cost care

the members. Merpbers would   e r quire to use a City-C\wned facility wtlen possible for certain services.       .   ..   .  .

To avoid Emergency Room utilization, the City would incant members through plan

design to use Minute Clinics, Urgent Care Facilities, Nurselines, etc.
blog comments powered by Disqus