For those of you in communities that do have health insurance through VLCT, you have probably already heard something about changes in health insurance that are being proposed for January 1, 2007. I have attended a few meetings on this issue, and have gathered some information that I want to share with all of you. Again, some of you may already be aware of some of this, so bear with me.
VLCT has provided health insurance to its member Towns and Cities through a contract VLCT has with Blue Cross Blue Shield of Vermont. In September Blue Cross told VLCT it was increasing its rates by 36% for 2007. VLCT negotiated with Blue Cross and got the rate increase down to around 29%, and then decided to leave Blue Cross and negotiated a contract with CIGNA to provide health insurance to its member towns starting January 1, 2007. CIGNA is working to create health insurance plans that mirror as much as possible the plans that are currently being provided by Blue Cross. There are some comparsion plans being circulated now, and you may see them showing up soon.
The issue that all of this raises is an obvious one. Many public employee unions have collective bargaining agreements that are currently in place and do not expire unitl at least June 07, and possible longer. Some of these agreements specifcially call for a Blue Cross insurance plan, like VHP, or the Freedom Plan. Some contain language allowing the employer to substitute a "comparable", or "substantially equal", or "equal" plan. Some contracts allow this substitution if the Blue Cross plan is not being offered any longer, or is no longer available. Other contracts do not have any language triggering when a change in insurance carriers can take place. The "substitution" language in your particular contract should be reviewed to see how it reads, and what degree of flexibilty has been given to your employer to change carriers during the term of a collective agreement. What each union's rights are at this point with respect to proposed changes will turn on this specific language in your agreements. If you want to send me the language you have in your agreements, I can let you know what I think your specific options are at this point.
After meeting with VLCT and pointing out the problem this change could prsesnt to towns and cities, the VLCT Health Trust Board voted to allow Health Trust member municipalities to offer BCBS plans to a portion of their employees and remain part of the VLCT Health Trust under the following conditions:
1. A BCBS plan may only be offered to employees with a collective bargaining unit where the labor agreement in effect at this time mandates Blue Cross Blue Shield health insurance coverage, and a copy of the relevant union contract is provided to the Health Trust Board;
2. The municipal employer has made a good faith effort to negotiate with the relevant bargaining unit to modify the labor agreement to allow/offer a comparable CIGNA health insurance plan through the VLCT Health Trust;
3. The BCBS plan may only be offered to the members of the bargaining unit through December 31, 2007 or the expiration of the relevant labor agreement, which ever is sooner; and
4. In each instance, the request to offer a BCBS plan will be subject to review and approval by the VLCT Health Trust Board.
So, what does all of this mean? As you can see from #1 above, if the language of your agreement specifically calls for a Blue Cross plan, you can continue with that plan at least for 07. If your contract language says something to the effect that a substitution can be made if the Blue Cross plan is no longer available, it should not require a change, since the Blue Cross plans are still available. If you have substitution language that seems to allow the employer to substitute carriers and plans, then you may need to carefully review the options that CIGNA is creating, and determine whether the new plan being substituted is, in fact, "comparable", or "equal", or whatever you have for language requires. If you have such language and the Town changes to CIGNA and adopts a new health plan, the test will be whether it is, in fact, comparable or equal, etc. In othe words, and again, depending on your contract language, you may or may not be able to stop a substitution of a CIGNA plan come January.There is a lot of pressure on Towns to change to CIGNA, so you may be able to use this to your advantage to get something improvements in exchange for the agreement to move to CIGNA.
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