In an initial discussion Wednesday about health care costs for 2015, the Company proposed eliminating the composite rate for insurance over the next three years.
The result would be a decrease in costs to single employees and a large increase of costs for employees with family coverage. Empire Blue Cross would continue to be the health care provider, and the dental plan would also remain the same.
Health-care coverage will be discussed at the union’s monthly Executive Board meeting at 5:30 p.m. Tuesday at the union office in the Albany Labor Temple. Members are welcome to attend.
Employees now pay $49.02 a week for health care. In the first year of the Company’s proposal, that would drop to $45.22 for singles, increase to $53.09 a week for two people, and rise to $60.67 for family coverage.
The Company also presented figures for the other two years of the phase-in, but those numbers assumed health-care costs otherwise remaining flat. In the second year, singles would pay $34.80, coverage for two would cost $50.79 and a family plan would cost $66.16.
In the third year, when the composite rate would be completely eliminated, the cost would be $24.69 for singles, $48.54 for two people and $71.49 for a family.
For employees with families, that would mean a 46 percent increase in costs over three years or an added $1,168.44 for a year. Again, those calculations do not include any rise in health-care costs, meaning the actual increase would likely be larger.
The Company says it is seeking this shift to avoid paying an excise tax scheduled to take effect in 2018 under the Affordable Care Act, also known as Obamacare. Under the law, the Company said, a 40 percent tax would be imposed on the portion of most employer-sponsored health coverage that exceeds $10,200 a year for singles and $27,500 for families. For 2015, the composite rate would be $12,510.90.
Of course, this assumes the penalty takes effect in 2018. A new president will be in office by then, and Congress or the new leader could decide to delay or halt that provision of the law.
Information presented by the Company Wednesday showed the biggest drop among union-covered participants in the plan has been among singles. The number of singles taking the Company’s insurance dropped from 47 to 34 in the past year. The number of couples dropped from 52 to 50, and the number of family plans dropped from 88 to 85.
The composite rate has existed for decades. The system means singles carry some of the burden for others, though many have been fine with that over the years because they expected to one day become part of a couple or have children. And, of course, as with any health insurance, the healthy subsidize the sick so that a family enjoying good health could cost less on health care than a single facing an illness.
Without the attempt to phase out the composite rate, the Company said the year-over-year increase would be 3.6 percent. The health-care increase would have been flat, the Company said, if the number of singles on the plan had not dropped.
Guild President Tim O’Brien and Secretary Mark Hempstead listened to the presentation, along with leaders of other unions in the plant. Questions were asked, but the Guild leaders said they would take the information, study it, seek advice from our International and gather input from our members before responding.
We have attached all the documents we were given today if anyone cares to look for themselves: 2014-10-01 Health Insurance 2015