The University of California is overhauling its systemwide health-insurance plans to save on costs and better align with the Obama administration’s Affordable Care Act, but some employees are angry over indications that they’ll be paying more just to keep their existing level of service.
System officials say that the changes are needed to avoid looming cost increases and that, in most cases, employees who pick the plan that is right for them will end up saving money and getting better service.
Dwaine B. Duckett, vice president for human resources in the office of the system’s president, said this week that the university would discontinue its Anthem health-care plans along with its Health Net Full HMO.
Replacing those will be the Blue Shield Health Savings Plan and UC Care, a three-tier preferred-provider plan that gives employees access to University of California doctors and medical centers as well as to the 88 percent of California doctors who belong to the Blue Shield PPO network, according to Mr. Duckett. He said about 10,000 of the 120,000 employees who are served by the university’s health-care system would have to switch networks as of January 1, 2014.
“The big question everyone’s asking,” he said, “is, ‘Is my doctor in or not?’”
In fact, he said, 97 percent of the providers who were available in the plans that are being scrapped will be available in the new ones too.
Mr. Duckett emphasized that he did not want to come across as callous: “We are completely sensitive to the fact that if you are in that 3 percent that does not have your doctor in, that’s a tremendous deal for you.”
‘A Line in the Sand’
Five of the 10 University of California campuses don’t have their own medical centers, meaning that Blue Shield, which will run the UC Care plan, had to negotiate fee structures with local hospitals and other health-care providers. In the end, negotiators got most of the providers to play ball—sometimes with a little nudging from senior university administrators.
Where negotiations were successful, such as around the University of California at Santa Cruz, people like Barry Bowman, a biology professor and member of the systemwide Academic Senate Committee on Faculty Welfare, feel a tremendous sense of relief. For employees on his campus, “it’s a win-win,” he said. “We have an even broader choice of doctors. For many people, our rates are actually going to go down.”
But Peter J. Taylor, chief financial officer for the university system, said the provider that dominates the area around the University of California at Santa Barbara, Cottage Health Systems, is demanding fees that would exceed what the university pays its own doctors.
“Cottage has drawn a line in the sand and said they simply won’t take less than what they want to get paid,” Mr. Taylor said.
Many of the Cottage providers will still be available, for a modest copayment, to members of the Health Net Blue & Gold HMO. But for members of the UC Care PPO, the providers will be “Tier 2,” meaning the members will be paying a percentage of the full cost of service rather than a fixed copayment.
That has angered some employees at Santa Barbara, who argue that the costs and deductibles will fall more heavily on them than on their peers at other campuses.
Henry T. Yang, chancellor of the Santa Barbara campus, said in a statement on Tuesday that administrators were “deeply concerned” that UC Care’s first-tier provider network did not include local physicians and services.
‘Trying to Find a Balance’
Others were more explicit in their criticism.
Nelson Lichtenstein, a history professor at Santa Barbara, said the change in plans constituted “a substantial hardship” for employees on campuses without teaching hospitals. Mr. Lichtenstein, who is president of the UCSB Faculty Association and is an occasional contributor to The Chronicle Review, was among the speakers last week at a town-hall forum where employees confronted Mr. Duckett about the shift in coverage.
Chief among their complaints was the apparent lack of comparably priced services among the 10 campuses.
But Mr. Taylor, the chief financial officer, said that Cottage’s unwillingness to negotiate put the university in a difficult position. Simply subsidizing the Santa Barbara employees’ costs was not an option, he said, because it would raise individual premiums systemwide by $323 a year.
“That’s asking 18,400 non-UC-Santa Barbara employees to pay out of pocket tremendously so that about 600 Santa Barbara employees would have access to this,” he said. “We’re trying to find a balance. We don’t have an inexhaustible supply of money, and yet we want to provide a solid benefit to our faculty and staff.”
Nathan Brostrom, the university system’s executive vice president for business operations, said administrators also wanted a plan that would align better with the Obama administration’s Affordable Care Act, which emphasizes greater medical management and focuses on preventive care and wellness. And looking at other large employers, he said, “we were really the outlier in not having a self-funded, self-insured plan.”
Christopher Newfield, a professor of American studies at Santa Barbara and an author of the influential Remaking the University blog, described his concerns over the new plans on Wednesday in a detailed post that examined how his partner had fared in the existing Anthem insurance system after suffering a deep cut in a kitchen accident.
Mr. Newfield, also an occasional Review contributor who is now on sabbatical in Britain, said in an e-mail message that the potentially higher costs for out-of-network care under the new plan are another significant issue for Santa Barbara employees.
“This is a big deal for a lot of faculty who are gone a lot (as I am, as are many lab scientists on big collaborations, etc.),” he wrote by e-mail.
