Saturday, October 30, 2010

Board, NFT to meet in December

The following announcement was just posted to the Board's Negotiation website . . .

The next negotiation meeting between representatives of the Board and NFT will take place on Thursday, December 2nd, at 6pm. One of the main topics of discussion will be the Board-proposed self insured Rx plan which will save the District an estimated $1.3 million annually.

As a reminder, even though the self insured Rx pan has no impact on employees, it still requires NFT approval to be implemented.


Mark said...

It would be a good idea to have an agreed upon agenda prior to going into the meeting.

Good Luck

KClarinet said...

I still don't understand what "self insured RX plan" means. Who covers the insured part of members' prescriptions?

JS said...

KC, I believe it is similar to if you were renovating your house and acting as the general contractor. Provided you are familiar with the appropriate guidelines and procedures you can perform the same duty with out paying someone else to.

It's essentially the District takes over the bureaucratic portion while keeping the end result (i.e. the prescriptions ) the same.

Langhorne said...

In a nutshell, self insured mean they will take on the coverage without the use of an insurance carrier.

KClarinet said...

But how could there be any guarantee of what this would cost? Do we know what's paid out each year in covered prescription costs? Who, if the district does this in-house will decide which drugs are covered, which aren't and keep track of the time between refills, how much was dispensed, etc...? How many additional employees will be needed to keep up with the administrativia as well as the real claim-by-claim decision making that now are handled by the plan provider? The district isn't now equipped or staffed to do any of this.

KClarinet said...

I forgot to add the obvious, that if the district can't provide all of this administration and oversight or simply runs out of money to fund the coverages, the employees' benefit is very much affected.

Langhorne said...

Typically the stakeholders of the fund hire an actuary to ensure this approach makes sense. Many Labor Unions take this approach with RX, Dental and Vision. Some of the larger Unions even do this with Health and Welfare plans.

Langhorne said...

Mr. Webb continually refers to the Teacher's health plan as the "Rolls Royce Health Plan." I agree it is an excellent Health Plan. But, what is his alternative? He is asking Teachers to pay a portion of the fee, but has not stated what the plan is or the cost. How can the Union agree to something they do not have information on?

KClarinet said...

Langhorne, what you describe is comforting as far as it goes, but when large entities like national unions take over this kind of responsibility, they are working with a much bigger funding base and they can always raise their members' dues if they need more operating cash.

Clearly, I'm not very familiar with how this kind of "self-insurance" works. My concern, which may be unfounded, is that someone - I would think the school district in this case - has to underwrite the actual cost of the insured expenses and also process each claim and disburse payments to the prescription providers. Can the district, given its finite budget and the extreme difficulty of increasing its revenue stream, guarantee to pay every employee's prescription cost beyond the co-pay plus the cost of additional staff to process the payments all from its operating budget? Is the cost even predictable?

An actuary can perhaps make educated predictions about some of these costs. But who makes the medical decisions - Blue Cross has long lists of medications classified into various degrees of coverage. Would the school district buy such lists from a full-time insurer? Who would process disputes over coverage decisions? How much staffing would all this require?

Perhaps I've missed the details if they've appeared in some other forum. But I'm very concerned to know what the projected cost comparison is between self-insured Rx and the current Blue-Cross-based plan and that the predicted cost of self-insurance clearly account for all of these related expenses.

Perhaps all of this is clear in the Board's planned proposal to the NFT, but if these kinds of questions aren't (or can't be) answered, then it can't reasonably be said that "the self insured Rx pan has no impact on employees."

Mr. O'Connor, when this first came up, promised to provide this kind of detail when it became available to him. I can only guess that most of the board members don't know how this would work any more than the general public does.

KClarinet said...

To be clear, I'm not dismissing the idea of self-insuring the prescription plan out of hand. I'm just skeptical that it's as cleanly equivalent to commercial insurance as has been suggested.

KClarinet said...

JS, the reason I don't do my own general contracting when I have work done on my home is that I don't know most of those things and would need to invest more of my time and energy to learn them than would offset the cost of hiring a contractor who already knows what he's doing. Moreover, in the case of prescription insurance, among the "appropriate guidelines and procedures" are medical ones that the district is not now in a position to make.

acs said...

Employees should have NO right to approve what plan an employer private or public chooses. In Centennial the average family plan cost is $14K per year in Neshaminy it is $27K. I defy anyone to find any school district or any private employees with a cost equal to this. Mr. Webb has offered lesser plans and NESPA has one. Why is NSD burdened with this plan? The 1998/2002 corrupted boards gave them a gold plated contract with only the best of everything FREE FREE FREE. Time for this union leader to put up and shut up. Stand firm William you are winning this big time.

KClarinet said...

ACS, my point has nothing to do with whether or not the employees have any rights in this issue or not. I'm specifically asking about the assertion that the change will not affect employee coverage. We already know exactly how you feel about NFT and unions in general. I'm trying to get at the accuracy of Mr. O'Connor's belief that the benefit is not affected by this decision. Whether or not you care is beside the point of my post.

Clearly it makes no difference to you if the assertion is correct or not. For those of us who may, your rants (which rarely vary in content) don't contribute to the discussion.

KClarinet said...

I am assuming at this point that no one here really understands how this "self-insured" prescription plan would work in Neshaminy or whether it would really be any more (or even possibly less) affordable to the district and the taxpayers than the current plan. This is not an academic issue, nor is it a pro-union or anti-union one. If it really does its job at a lower cost, it may be a good idea. If it could become an open money pit into which the district is legally obligated to shovel unpredictable amounts of operating dollars, it's a potential disaster for everyone on both sides of this conflict.

All I'm trying to do is gather information, not trying to "win" a point or a skirmish for one side or the other. So far, there's no evidence that anyone has any real information about this particular plan.

William O'Connor said...

Here is my simple explanation of what self insured Rx is . . .

Under our present plan, we pay a premium to Blue Cross for each employee's Rx plan. Blue Cross makes money because they like all insurance companies are in the risk business. They play the odds and bet that not every employee will use the Rx plan, therefore if they collect on all the employees but pay out on only some, they realize a profit.

What we propose is to do the same thing except we take the risk, and instead of us paying Blue Cross for all our employees, we pay the claims and keep what is not paid out. Since we are a public entity we would eliminate undue risk with a stop loss insurance policy to protect the district from a catastrophe.

This is is nothing new in the world of insurance, and the NFT has also spoken in favor of this plan.

For any current or retired NFT employees, they can contact their officials for a more detailed explanation.

If a member of the public wants more detail, I recommend you attend a Board meeting and ask your questions during public comment.

acs said...

KC, You write to read your own stuff and very rarely move the topic forward. Welf-ins is simple risk reward decision with NO complexity unless you want to make it so like Boyd and NFT. The district backs due to life history on RX and knows we can cover w minimal risk. The NFT has no risk and no change to teachers' plans but Boyd will not agree unless she gets retro, 3% raises +steps and full retirement perks w Rolls Royce HC. Go to Google and read up if it is too complicated.

KClarinet said...

Mr. O'Connor said:

"Since we are a public entity we would eliminate undue risk with a stop loss insurance policy to protect the district from a catastrophe."

Thank you! That answers part of my question. Now, has the administrative cost of managing this plan day-to-day been projected in enough detail to be sure that given our relatively small risk pool (compared to a national union or a large corporation) the profit will at least cover the operating costs exclusive of claims payments? And who would make the medical decisions regarding which drugs are covered and at what rate? Are those tables available commercially or does someone with a medical background need to be paid in-house?

From what I've seen of the board meetings on TV and the few that I've attended, public comment is just that - it's mostly one way unless someone really gets under a board member's skin. It isn't a question and answer period. This blog's greatest benefit, in my opinion, is its ability to host honest and open discussion, including putting questions together with their answers. I'm very thankful for the information I'm able to get here. I very much appreciate the time you, Mr. O'Connor, put into this blog and hope that it can continue to function as a conduit for real information.

Thanks again.

Langhorne said...

ACS, actually many employers with 500 or more employees offer two choices of Health Coverage. This is true in the private and public sector. The more employees you have, the easier it is to shop around for insurance coverage.

My point is that Mr. Webb has not presented what type of coverage or the cost teachers would be paying a percentage of. Do you purchase a home or car without seeing it and knowing what it will cost you monthly?

KClarinet said...

ACS wrote:"Welf-ins is simple risk reward decision with NO complexity unless you want to make it so like Boyd and NFT."

I don't actually know what Louise Boyd's official reaction will be to this proposal - as far as I know neither she nor the rest of the NFT leadership has officially (publicly) commented, and I don't expect to hear anything until the news coverage following the next negotiating session. So I have no idea if Ms. Boyd and the NFT find this proposal complex or simple, acceptable or objectionable.

I'm not sure which of my questions you find unreasonable. I think if they had simple answers someone would by now have provided them. I think that no one really knows the answers.

This issue would - or should, I think - have come up regardless of the current contract status. If self-insuring is really a cheaper way to cover prescription insurance in the district with no loss of benefit to the employees, it should be seriously considered. I've no problem with that and, if the NFT leadership does object without good reason, then shame on them.

Why does that make asking questions
"writing to read my own stuff?"