Employees will have to supplement health costs

Rachel Abbey

Health care costs have been rising for colleges and their employees, and Kent State is no exception.

The College and University Professional Association for Human Resources reported in a press release that 63 percent of individual employees and 78 percent of higher education institutions saw an increase in health care costs last year, according to data from its annual benefits survey.

This January, Kent State’s health care plans will change as a result of the most recent bargaining agreements, said Larry Salasek, manager of university benefits.

“In order to participate next year, employees will be asked to contribute,” Salasek said.

Before, employees could choose not to contribute to the cost of their health insurance, and more than half chose not to, Salasek said.

Rising health care costs are a national problem, said Carolyn Pizzuto, vice president for Human Resources. The cost to provide health care is so high because the funds have to pay for medical equipment, insurance coverage and the laborers in the market, such as doctors, nurses and technicians.

Ten years ago, health care became a national crisis, she said, and the country has not yet recovered. Last year, Kent State saw a 20 percent increase in the dollar amount of health care they were providing to employees.

The amount rises each year, but that kind of percentage increase cannot continue, Pizzuto said. Health care usually costs the university between $25 and $30 million each year.

For a while, the university was able to bear the burden of health care costs, but a lack of state funding has forced the administration to search other options, Pizzuto said.

Kent State employees will now share the cost of health care, using a sliding scale to determine how much coverage an employee wants to pay for, Salasek said.

“The more benefits they want, the more they’re expected to pay,” he said.

Salasek compared the coverage to car insurance, where the higher deductible a person pays, the higher his or her coverage will be.

The average faculty member’s earnings are within the $52,000 to $63,000 bracket, said Cheryl Casper, president of the American Association of University Professors and economics professor.

“For the best plan, the 90-70, the average contribution is going to be about 13 percent,” she said.

That means if an employee chooses a physician within the insurance network, 90 percent of the cost will be covered by the insurance, but only 70 percent will be covered if the physician is outside the network, Casper said. Thirteen percent of the cost would be contribution from the employee, and the rest would be covered by the university.

Employees wanted to pay just for what they will use, Pizzuto said, so that was the basis of the plan.

The new plan will also be easier to use, because employees can choose their own care providers and physicians outside the insurance network, Salasek said.

Employee feedback was very important to arriving at this plan, he said. The Health Benefits Review Committee met during contract negotiations for the faculty union, but its members represented all university employees. Most of the committee’s suggestions appeared in the final health care plan.

“It’s not easy for anybody to make these kinds of changes where employees are being asked to contribute to their health care, so we try to do it in a way that’s best for everyone,” Salasek said.

The university went through rounds of focus groups, Pizzuto said, and warned employees that costs had to rise.

While employees may have to begin paying next semester, Kent State’s coverage level actually increased in some areas, Casper said. For example, an employee’s lifetime coverage rose from $1 million to $2.5 million.

“A major surgery could eat up a large chunk of a million dollars,” Casper said.

The new plan also increased coverage in areas such as hospice care, well-child check-ups and physicals, Pizzuto said.

The university began a prevention and promotion-based wellness strategy last year, she said, encouraging employees to raise their health awareness.

“Managing cost is not the same as managing health,” she said.

However, the two most unpredictable aspects of the university’s health care budget are claims and prescription drugs, Pizzuto said. If employees were more aware of possible problems before they happened, these particular costs could be decreased.

“It’s asking America and, in this case, Kent State employees, to consciously think about the way they live their life, instead of just asking the administration to pay for the choices they make,” she said.

Pizzuto said the wellness strategy includes both program offerings and health screenings. She wants to increase the program and offer initiatives, such as reduced recreation center rates or lower insurance premiums, to employees who attend.

Contact administration reporter Rachel Abbey at [email protected].