Health care premium increase comes as shock to IU employees

It wasn’t the more than 100 percent increase in health care premiums this year that had IU faculty members upset.

And it wasn’t the fact that the premiums are no longer uniform, but instead based on salary brackets.

It was the way the administration went about implementing the new benefit package: swiftly and without consulting the standing Bloomington Faculty Council Benefits Committee.

“The most insulting thing is when we find out information that is completely pertinent to us in the newspaper,” said Chair of the BFC Benefits Committee Brian Horne.

The article Horne referred to was published in the Bloomington Herald -Times on Oct. 14, 2011. Two days earlier, Executive Vice President and Chief Financial Officer Neil Theobald addressed a letter to his colleagues explaining the upcoming increase.

“In the next few days, you will receive the open enrollment information from the University Human Resource Services to select your 2012 health care plan,” he wrote in the letter. “Unfortunately, rising health care costs have become a universal reality.”
Horne, who has been a member of the Benefits Committee since 2010, said he heard some rumblings and warnings of the increase, but the amount of the increase came as a surprise.

He said the committee met with administration members only once in fall 2010 — and consultation was severely lacking this calendar year as well.

“We have a standing committee for benefits and recently it feels like the administration will go outside that committee and appoint their own for whatever reason,” Horne said. “I believe it’s partially because they want people who they know they can talk to and so it will get done quickly. So it will be nimble and so it’s a group of people that already share their opinions.”

Although Horne said the administration met with its own committee to discuss the increase in 2012 health care premiums, notes from a Faculty Council and Staff Council executive meeting make that unclear.

Theobald was a guest at the Oct. 25 meeting.

“Theobald met with leaders from administration, faculty and staff governance and other leaders on the campuses,” notes from the meeting stated. “The option was either to scale back the coverage of the insurance plans or to raise premiums. Theobald said he received unanimous feedback to raise premiums.”

Mary Gray, co-chair for the BFC Benefits Committee and an associate professor for the Department of Communication and Culture, said the faculty leadership in which Theobald was referring to was the Blue Ribbon Expert Committee on Healthcare Cost Containment — a committee formed by IU President Michael McRobbie.

Although the Blue Ribbon Committee included a BFC Benefits Committee member, Jim Sherman, he did not formally represent the Benefits Committee in those meetings, and he did not report back to the Committee.

“At no point did (Human Resources) formally speak with the Benefits Committee about its projected premium increases,” Gray said. “It is entirely possible that HR met or emailed with the chair of the Benefits Committee, but I have no record of that.”

Gray said no meeting took place between the Benefits Committee, HR and Theobald’s office that would indicate how any of the proposals created by the Blue Ribbon Committee would be implemented.

To ensure proper faculty leaders are consulted in the future, the BFC passed a resolution Jan. 24 on reporting benefits to IU faculty.

The resolution includes three requests for McRobbie and Theobald.

First, the resolution encourages the administration to reissue a detailed cost-benefit analysis explaining the rationale behind the dramatic rise in health care premiums between 2010 and 2012. The deadline for that redistribution was Dec. 31, 2011, but the BFC voted to extend the deadline indefinitely.

Next, it was proposed that the administration should establish an IU Employee Benefits Advisory Commission and meet with it each February as budgets are made available to human resources for benefits management.

The third request would require the administration to present proposed changes in future health and other benefits program plans no later than July 1 so that changes may be reviewed by the full University Faculty Council. The final request was implemented so faculty members would have a chance to react to any changes before open enrollment.

Horne said the administration is in no way obligated to abide by the resolution, but he said he hopes the requests will be acknowledged for the sake of a cooperative and collaborative relationship.
 
“I’m very grateful and I feel that our benefits package is very good and it’s not like that in other places right now, even in other university systems,” Horne said. “I don’t want to lose track of that, but when we hear about something first and foremost in the newspaper before we find out about it from our own administration, there’s a fairly significant amount of frustration.”