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November 21, 1996

Administration will consult with Senate, SAC on health insurance

Pitt senior administrators have promised to consult with the University Senate and the Staff Association Council in negotiating the University's next employee health insurance contract — or contracts, if Pitt awards its business to more than one vendor.

At the Nov. 11 Senate Council meeting, Chancellor Mark A. Nordenberg and Provost James V. Maher said they will seriously consider the faculty and staff groups' advice in evaluating insurers' proposals, and will try to secure the widest possible choice of health coverage for Pitt employees.

The University's current three-year contract with Blue Cross of Western Pennsylvania doesn't expire until the end of June 1998. But Senate leaders, alarmed by planned limitations on health plan choices for University of Pittsburgh Medical Center (UPMC) employees and signs that Blue Cross may drop its Comprehensive Deductible option, proposed the following resolution at last week's Council meeting: "It is the sense of the Senate Council that, in order to protect the interests of faculty and staff as consumers of health services, the University administration give high priority in its negotiations concerning health benefits to (1) maintaining for faculty and staff as large a range of choice as possible respecting health benefits plans and health services providers, including an indemnity plan, and (2) permitting the relevant committees of the Senate and staff to participate in the evaluation of proposals made to and by the University concerning health benefits." Council approved the resolution overwhelmingly, although Chancellor Nordenberg abstained — not because he disagreed with the resolution, he said, but for procedural reasons. Nordenberg said he was uncertain whether he should vote now as a Council member to endorse a statement that might later be presented again to him by the University Planning and Budgeting Committee.

The resolution's reference to maintaining an "indemnity plan" was intended to ensure that Pitt employees will continue to have the option of a non-managed care plan such as Blue Cross Comprehensive Deductible after July 1998.

Faculty Assembly on Nov. 5 passed a resolution likewise specifying that Pitt retain an indemnity option. At that meeting, members of the Senate's benefits and welfare committee said they believe Blue Cross intends to eliminate its Comprehensive Deductible plan. Nearly 1,300 Pitt employees currently are enrolled in Comprehensive Deductible. (See Nov. 7 University Times.) The Blue Cross spokesperson to whom the University Times was referred did not comment on the future of Comprehensive Deductible. Blue Cross already has stopped accepting new members into its University Health Network (UHN) plan, which is the only non-managed care option for Pitt employees other than Comprehensive Deductible. Blue Cross will drop UHN entirely at the end of June 1998.

Regarding faculty and staff participation in making health care choices, Nordenberg and Provost Maher told Council that they will do everything in their power to avoid repeating what Maher called the "horrible mess" of 1994-95, when the administration engaged in a long and sometimes rancorous debate with faculty and staff groups over the wisdom of dropping the HealthAmerica plan and making Blue Cross the sole provider of medical insurance for University employees.

Then-Chancellor J. Dennis O'Connor ultimately decided to eliminate HealthAmerica despite opposition from the Senate, the Staff Association Council and the Medical Review Committee, a group of faculty, staff and administrators who advise Pitt senior officials on benefits issues. In a survey of faculty and staff, conducted in winter 1995 by the University's Office of Human Resources, 76 percent of the 4,724 respondents said they believed Pitt should maintain more than one health insurer.

Maher told Senate Council last week: "I think it's very important that we avoid the kind of misunderstandings that went on a couple of years ago…My concern is far more than anything else to avoid misunderstandings and come out of this next year, whatever goes on, with more of a feeling of common purpose and working together." O'Connor and other senior administrators said they took employee advice seriously but ultimately accepted Blue Cross's offer for two major reasons: * It provided an estimated $5 million in savings on Pitt employee health insurance premiums during the three years of the contract.

* HealthAmerica avoids referring patients to UPMC System hospitals because of those hospitals' comparatively high costs. According to the administration, HealthAmerica's policy conflicted with the interests of the approximately 1,500 Pitt faculty members affiliated with UPMC.

However, faculty and staff critics of the decision noted that medical center officials rejected a 1995 offer from HealthAmerica that would have allowed its Pitt subscribers to use UPMC facilities and personnel. And the critics suggested that the administration was more concerned with the well-being of the UPMC System than with the interests of Pitt medical faculty affiliated with it.

Senate leaders accused the administration of basing its decisions on a philosophy of "what's good for the UPMC System is good for Pitt" — an assumption they said was misguided at best.

Gordon MacLeod, a member of the Senate benefits and welfare committee, said he and other committee members fear that Pitt's administration eventually will follow the lead of UPMC in offering employees health insurance coverage through just one plan, a new one called Tri-State SelectBlue.

Beginning July 1, 1997, Tri-State SelectBlue will be the only plan available to UPMC employees. It is based on Blue Cross's current SelectBlue option but with cost savings for subscribers who choose a primary care physician from the newly formed Tri-State Health System. The system includes UPMC and six affiliated hospitals.

Chancellor Nordenberg denied that Pitt's administration is planning any such move. "We have had no substantive discussions with anyone about the health care alternatives that might exist when the [current Blue Cross] contract expires," Nordenberg said.

Maher added, "It would be inappropriate for anybody in the administration to be committing now to a policy on a situation that is evolving rapidly and into which we'll only be injected about a year from now." Prior to the vote on the Council resolution, Maher said it would be unwise for the administration to lock itself into a too-specific role in collaborating with faculty and staff during the next contract negotiations.

Referring to a phrase in the Senate Council resolution, the provost said: "I would hate, for example, to have somebody later put a narrow interpretation on what was meant by 'participate in the evaluation of proposals made to and by the University' and then have people feel betrayed." Council member Nathan Hershey, who drafted the resolution, said he didn't see why Maher found its wording to be ambiguous. "Participation" and "evaluation" are part of the lexicon of shared governance, said Hershey, a faculty member in the Graduate School of Public Health. "I'm sorry you find it [to be] so offensive," he told Maher.

"I didn't mean it was offensive, Nathan," the provost replied. "I'm just worried about well-intentioned vagueness turning into feelings of betrayal on the part of people who have interpreted one or another word more narrowly." After Maher said the Faculty Assembly and Senate Council resolutions had come "from out of the blue," Hershey said: "I'm surprised that you would say this thing comes from out of the blue. I don't think there's one subject that gets more attention and discussion by people in the so-called middle class than consideration of health benefits and concern about employees losing [benefits] or being unduly restricted." Presidential candidates and journalists have been talking and writing extensively about health insurance, and it's not too soon for Pitt faculty and staff to raise the issue of the University's next contract negotiations, Hershey said.

Maher agreed. In commenting that the Senate resolutions came from out of the blue, the provost said, he meant only that he first heard of them by reading the Nov. 7 University Times, and that he was surprised to learn of the Senate's concern at a time when Pitt is enjoying a respite from the tough contract negotiations and high rate hikes that other local institutions are dealing with.

"Of course, we have to watch [the current medical insurance market] and we want to try and stay on top of it," Maher said. "But it is evolving so dramatically that we couldn't make our decisions now. We have to watch it and see how it evolves. And if the sense of this [Council resolution] is that we're all going to watch it together, that's wonderful. But if the sense of this is that we've got to commit ourselves to what our reaction will be a year from now, then this is premature."

–Bruce Steele

Filed under: Feature,Volume 29 Issue 7

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