Tag Archives: Unions

Mayor de Blasio Incentives Unions to Reduce Health Costs

When Mayor Bill de Blasio announced his first labor agreements with New York City unions this spring, he was sharply criticized for granting long-awaited wage increases in exchange for promises of unspecified though sizable savings on health care expenses.

Now, some of the specifics are coming into focus: City officials and union leaders say they hope to push municipal workers to use walk-in clinics more and emergency rooms less, order generic drugs more often than brand-name ones, and buy them through the mail rather than at retail pharmacies to achieve bulk discounts.

The city hopes the unions will agree to steer workers to use centralized, cheaper centers for blood tests, X-rays or M.R.I.s, rather than having those tests performed in doctors’ offices or at costly physician-owned facilities. Patients who resist could face higher copayments, while savings would be passed on to the city in lower premiums.

The cost-cutting comes with high stakes: If the city and unions are unable to save a total of $3.4 billion on health care by 2018, a mediator will be empowered to order increases in workers’ premiums to cover the shortfall, officials said.

As an added inducement, if the unions help the city exceed that goal, the first $365 million in additional savings would be distributed as lump-sum bonuses to workers, officials said. Any savings beyond that would be split evenly between the city and its employees.

In interviews, Harry Nespoli, chairman of the Municipal Labor Committee, the umbrella group of city unions, and Robert W. Linn, the city’s labor relations commissioner, disclosed several of the cost-saving measures being discussed as the two sides draw closer to a deal.

For example, union officials are meeting with EmblemHealth, an insurer that covers many municipal union members, to negotiate increased access for employees to EmblemHealth’s more than 40 walk-in clinics across the city.

Arrangements like that could reduce costly emergency-room visits not only for the city’s 350,000 workers but also for their dependents — a total of about one million people, the officials said.

Missing from the labor contracts with teachers and other city workers that were announced beginning in May was any requirement for union members to begin contributing toward their health insurance premiums. That prompted some critics to say Mr. de Blasio was not being tough enough at the bargaining table.

Earlier this month, the Metropolitan Transportation Authority and the unions representing 5,400 Long Island Rail Road employees agreed that those workers would begin paying 2 percent of their wages toward their health coverage.

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Jeffrey R. Ungvary President

Jeffrey R. Ungvary

Affordable Care Act Divides Workers and Employers

Disputes between unions and employers over paying for new costs associated with the Affordable Care Act are roiling labor talks nationwide.

Unions and employers are tussling over who will pick up the tab for new mandates, such as coverage for dependent children to age 26, as well as future costs, such as a tax on premium health plans starting in 2018. The question is poised to become a significant point of tension as tens of thousands of labor contracts covering millions of workers expire in the next several years, with ACA-related cost increases ranging from 5% to 12.5% in current talks.

In Philadelphia, disagreement over how much workers should contribute to such health-plan cost increases has stalled talks between the region’s transit system and its main union representing 5,000 workers as they try to renegotiate a contract that expired in March.

Roughly 2,000 housekeepers, waiters and others at nine of 10 downtown Las Vegas casinos voted this month to go on strike June 1 if they don’t reach agreements on a series of issues, the thorniest of which involve new ACA-related cost increases, according to the union.

Labor experts on both sides say the law doesn’t take into account that health benefits have been negotiated by employers and unions over decades, and that rewriting plans to meet new requirements can affect wages and other labor terms.

“It’s been a challenge for even some of the stronger unions to maintain the quality health plans that they have offered over the years,” said Daniel Murphy, an attorney in New York who represents employers in labor talks.

Among the earliest supporters of the health-care law, unions have unsuccessfully tried to win concessions from the Obama administration on some issues now involved in the labor talks.

One pressure point is the higher costs of new mandates, especially the requirement that health plans expand coverage for dependents. For Unite Here, adding that coverage for 14,000 dependents raised costs in the health-care fund run by the union’s Las Vegas local by $26 million since 2011, said union spokeswoman Bethany Khan.

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Jeffrey R. Ungvary

President

Jeffrey R. Ungvary