Contract 2011 Health Plan Comparison

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VP’s Corner

By Alex Brown

GE’s Health Choice: Mike and Millie Middleage

            GE top brass keep telling the union that their management plan will soon be our members’ and retirees’ plan. Negotiations don’t start until May 2011 so their self congratulations are premature.

To better understand why management folks hate this plan and how it would affect us, I want to look at different members’ experiences with their current plan and compare it to what their costs would be under the new management plan. (I used GE fact sheets to get the rules.) My first volunteer is the middle aged couple, Mike and Millie Middleage. He’s worked at GE for 30 plus years, is in his mid 50’s, and works at the R-23 rate. That rate puts him in the $50,000 to $74,999 bracket for payroll contributions, deductibles and under the new management plan, the co-insurance max. (For the purpose of determining premiums, your annual pay does not include OT or NSB.)

Mike’s got no major health issues, but GE will penalize him for being a smoker and will charge him $625 per year under the new plan. Millie is in her 50’s with lupus and a thyroid condition. Currently, they are in the Health Care Preferred Plan (HCP) which has a premium but no deductible unless you go out of network. They haven’t. But they do pay the standard co-pays. The attached chart compares their costs between the current HCP plan and the management Option 1 plan based on their 2009 costs. (It has higher payroll contributions, but lower deductibles compared to the other management plans.)

Bottom line: their costs more than double.

How does this work? On the left hand side of the chart is the HCP costs with the payroll contributions at the top and the list of services and co-pays, if applicable. On the right hand side, is the premium for Option 1 and the new smokers’ charge. The biggest difference for our members is the management plans go back to a deductible. That’s an amount members have to pay before the insurance pays. Routine physicals and preventive services are completely covered so there is no charge to Mike for their physicals. But the $1296 charges for Mary’s 5 specialist visits for her lupus and thyroid condition go toward their $1600 deductible. The $110 charge for medical equipment for his back problem also goes toward their deductible.

Mike had a colonoscopy this year which was not routine. In the HCP plan he paid the $100 co-pay. The eligible charge was $2295. So under the management plan, $304 went to meet his deductible, and of the remaining amount of $1991, he owed 20% co-insurance or $398. Millie’s other specialist visits and lab work were charged at 20% of the cost. And finally, her prescription co-pays were high because she must take brand name drugs for her conditions. The generics she tried were not effective. So she was charged 30% of the costs. GE does fund a $750 Health Re-imbursement Account for two people to help defray the costs. That’s a tax free account that GE funds that members can tap to pay some of the upfront costs.

The management plan has two other options with lower payroll contributions but higher deductibles and co-insurance maximums. If Mike and Millie got in those plans based on their usages for 2009, they would have saved about $150 in 2009. But what if in 2010, they had much higher health care cost needs? What if they had a trip to the hospital, or a heart attack, or a cancer diagnosis? Those things cost thousands. Then the deductible plus the co-insurance max can be very expensive. For them for Option 1, deductible plus co-insurance max is $4225 plus $2200 in weekly deductions totals $6425 cost. Compare to Option 2: $5775 for deductible and co-insurance max plus $1500 weekly deduction totals $7275. So that $150 savings disappears and is replaced by an $850 cost. That’s why we say it’s a plan that gambles with your health. To see the charts for Management Option 2 or 3, check our website at local201iuecwa.org.

Interested in being the next volunteer? Questions? Call me at the Hall or email me at Abrown@local201iuecwa.org.

Click on this PDF file to see a comparison between all three Management options