UAW Local 2322 joins legal complaint over new student “coinsurance”

On Wednesday, September 21, 2011, United Auto Workers Local 2322 joined a number of community and advocacy groups with whom we have been working to save UMass student health care to file a complaint with the Massachusetts Division of Health Care Finance and Policy, stating that the University’s new Student Health Insurance Plan violates Massachusetts law.  The text of the complaint is available in full below:

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GEO-UAW 2322 | Press Release 8-15-2011

University’s Defense of Changes to Student Health Insurance Based on False Claims and Manufactured Deficit

Amherst, MA  – Information recently received by the UMass Graduate Employee Organization (GEO), a unit of UAW Local 2322, demonstrates that the University of Massachusetts Amherst has based its defense of massive changes to the Student Health Insurance plan on false claims and manufactured deficits.

On August 1, 2011, the University of Massachusetts Amherst instituted major adjustments to its Student Health Insurance Plan, including the institution of a 15% “coinsurance” payment for all procedures not performed by University Health Services (UHS). This change could cost affected students as much as $5,000 per year. In an interview with the Daily Hampshire Gazette, published on July 16, 2011, University spokesperson Daniel Fitzgibbons claimed that the changes were necessary for two reasons:

  1. “Given that the health center ran a half-million dollar deficit last year, university officials said the center couldn’t continue to subsidize full coverage for the 5,800 students on SHIP. ‘This is about high quality care for students and continuing to maintain financial stability at UHS’ said Fitzgibbons. ‘Being $500,000 in the hole last year is a considerable hurdle to continue to provide this.’”
  2. “The move is also being made to keep premiums affordable, he said. If UMass had retained its 100 percent coverage, premiums would have gone up by about 30 percent, said Fitzgibbons. The new plan keeps the premium hike to 17 percent.”

Information received by the GEO, as part of the fulfillment of an information request filed on June 9, 2011, demonstrates the claimed deficit is merely the product of accounting tricks, and the claim about premium increases is simply not true.

According to the UHS budget (Attachment 1), it is technically true that the facility ran a $460,333 deficit in FY2011. However, the primary cause for this deficit is a $1,102,350 expense labeled “R&R Contribution.” According to UHS Director Bernie Daly in an email dated August 12, 2011 (Attachment 2), this line represents expenditures for “large capital purchases such as repairs to the building or large equipment purchases such as electronic health records, radiology equipment etc.”

UHS made no expenditures on this line in either FY2009 or FY2010, making it clear that they had deferred these expenses until FY2011, at which point they made three years worth of “R&R Contribution” expenditures. As such, it is much more appropriate to average this expense, along with revenues, across the three year period of FY2009-FY2011. When this averaging is done (using the attached UHS budget document) it becomes clear that UHS has actually made a profit of $1,004,152 over this period, or an average profit of over $330,000 per year. There is, in short, no evidence that UHS is experiencing structural deficits, and in fact it appears to be quite profitable.

Additionally, the University made the claim that in order to maintain the same coverage as last year (which did not include the 15% “coinsurance”), students would have had to absorb a premium increase of “about 30 percent.” However, according to documents related to the bid process for the Student Health Insurance Plan (Attachment 3, page 5, line 4), students would have been required to pay only a .4% premium increase in order to renew the plan from FY2010. This would have meant that annual premiums for individual students would have risen from about $2,350/year to $2,361/year, or an increase of about $11/year.

The 30.7% increase mentioned by the University (Attachment 3, page 5, line 5) applies not to a simple renewal, but rather to a substantial change in the Student Health Insurance Plan which has the effect of transferring much of the cost for procedures conducted at UHS from the University to AETNA (the provider of the Plan). This might make sense as a way to compensate for the claimed deficit, but given that this deficit is the product of deferred expenses, there is no clear justification for gutting Student Health Insurance in order to increase revenue (or decrease expenses) at UHS.

“This deception is unacceptable under any circumstances,” said GEO President Derek Doughty, “but it is an even bigger problem when students’ health and wellbeing is at stake. The University has put aside its responsibility to provide the best possible coverage for students in favor of maximizing its own revenue. These documents make it clear that this is not a case of ‘can’t,’ but simply a case of ‘won’t.’”

GEO has filed a grievance against the University claiming that these changes violate the union’s contract. The organization is in the process of filing a grievance with the Commonwealth as well, claiming that this new plan does not meet the minimum requirements set by Massachusetts for a student health insurance plan.

GEO represents more than 2500 graduate student employees at UMass/Amherst and is a proud member of the United Auto Workers (UAW), Local 2322, which represents 3600 workers in Western Massachusetts in the fields of higher education, early childhood education, and health and human services.

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Attachments:

FAQs about the GEO Stipend Increase

Stipend Increase Schedule

Q: When are the increases going to be implemented?

A: Here is the “tentative” schedule from the University: The lump sum retroactive payment for the FY10 1.5% base stipend increase will be paid on the January 21, 2011 paydate.

The new stipend rates for the FY11 2.5% base stipend increase will be set in the February 18, 2011 pay advice, including any 1.0% pool minimum stipend adjustments.  The lump sum retroactive payment for the FY11 stipend increases will be paid on the March 4, 2011 paydate.

Q: Why is it called a “tentative” schedule?

A: Juan Jarrett tells us that his email used the term “tentative” because he once had an issue with processing four years of bulk retro payments after Mitt Romney had held up all pay increases during his term as Massachusetts Governor.  The processing was held up briefly after the schedule was announced, so he now uses the term “tentative”.

Q: Why are the raises occurring so late?

A: The first raise should have gone into effect on August 30, 2009.  The second raise should have gone into effect on August 30, 2010.  The University did not comply with these dates, which we negotiated in the last contract, because the Massachusetts state legislature never passed legislation approving the funding appropriation for our contract.

Over the last Summer, the University came to the unions on campus that had unfunded contracts with a request that they open the contracts to take concessions, pushing raises back a year and eliminating retro pay.  GEO and UAW Local 2322 were adamant that we would not open the contracts to take concessions, particularly because the University could offer no guarantee that the concessionary contracts would ever be funded.  When the University was sending the other campus unions’ modified contracts to the legislature, they asked that the Governor’s office send our contract funding bill to the legislature again.  The Governor’s Office responded that they had made other changes to the University’s budget that should allow them to fund the GEO contract out of the University’s budget.

Q: Why are the raises happening in the Spring instead of this pay cycle?

A: The University has provided us two reasons for this.  First, the payroll department is going into their crunchtime for the year – preparing for year-end tax reporting.  Second, the Graduate Assistantship Office is already processing Spring 2011 Graduate Fellowship and Assistantship Forms (GFAF’s), popularly known as department contracts.  These contracts have been written with the old department rates, because departments have not received guidance from human resources on their new rates (including the pool, etc.).

Because of this, the University is concerned that, if they implemented the raises now, people will see a raise this semester and then a return to their old rate at the start of the Spring semester, while the University tries to fix the rates in the new Spring GFAF’s.  People would eventually get all of their pay, but it would be a confusing way to implement the system, and it would also hold up the AY2010-2011 pool calculation, which has to be based on weighted averages of stipends that have received the AY2009-2010 increases.

Pool Calculations

Q: What is the Pool?

A: The pool is an increase to the lowest minimum stipends on campus by an amount calculated by “multiplying the total campus state- and GOF –funded bargaining unit payroll in effect on September 5, 2010 by one (1) percent.”  This amount of money is “used to raise the lowest minimum stipends across campus to a level possible with this amount. Those schools, colleges, and executive areas so leveled by this pool shall have a new minimum stipend corresponding to the new level. Graduate student employees in said school, college, or executive area shall have their stipend increased to the new minimum, if necessary” (GEO Contract, Article 32, §2).

Q: Why do we have a pool?

A: The pool reflects GEO’s desire to level out the minimum stipends across campus by bringing up the lowest department stipends rather than setting artificially low minimums across the whole campus.  The use of the pool in contracts over the last two decades has lessened disparities between department minimums to the point where there could be one campus-wide minimum stipend within the next round of bargaining.

Retro Payments

Q: How will people who have left the University get their retro?

A: The University attempt to contact former Graduate Student Employees (GSE’s) eligible for retro payments, and will send checks to the addresses people left on file with their departments.  If a check has not been deposited by the time it is voided, the money will be sent to the state’s unclaimed funds account in the GSE’s name.

Q: What taxes will be applied to the retro checks?

A: For currently active GSE’s, members current withholding rates will be applied to the payments.  For former GSE’s receiving lump sum retro checks, the Massachusetts supplemental income tax rate will apply.  That rate is 25% Federal, 5.3% MA.  This is likely a higher marginal rate than what people currently pay, so there will be more money withheld from that check than there would be for their typical withholding.  As always, people should be sure to get their W-2 following the end of the calendar year 2011 so that they can receive a tax refund if they are owed one.

Time to Double Check Your Contract

Have you checked your Graduate Fellowship and Assistantship Form (GFAF) this semester?  This is the form, known to most as your individual contract, that you sign at your department when you accept an assistantship.  It lists your start date, end date, hours per week, hourly rate, signature of Grad Program Director, and so forth.  If you no longer have your copy, you can get one from your department.

We’ve been finding a number of issues with GFAF’s this semester, including people whose contract period is less than they initially thought it would be, and people whose hours are lower than they expected.  While these issues are not necessarily grievances under our contract, it is important to make sure you are able to do your job within the hours on your contract.

Contract Duration

Fall semester assistantships run 19 weeks, from September 5, 2010 to January 15, 2011.  Spring semester assistantships run 19 weeks, from January 16, 2011 to May 28, 2011.  If your contract is for fewer weeks than 19, you may be in danger of not earning enough to qualify for fee and health insurance waivers.

Additionally, your contract should allow you to take your earned vacation time.  The Graduate Assistantship Office provides a handy reference for how to calculate your vacation time in this quick reference.  The GEO contract speaks to how you can schedule your vacation time (GEO Contract, Article 37; emphasis GEO’s):

Graduate student employees who are TAs and TOs shall take vacation time during Winter break or Spring break unless they reach an agreement with their department head that an alternative schedule would be acceptable. All other graduate student employees may take vacation at any time, provided they obtain prior written approval of the supervisor.

All vacation time shall be requested in advance and scheduled at the
discretion of the department head. These requests shall not be unreasonably denied.

If you are a TA or TO and your contract does not include Winter break, you need to speak with your department head about when you will be taking your vacation.  We have been seeing these short contracts among people who are teaching at other colleges but receiving a UMass paycheck.  If you are teaching at Smith, Mt. Holyoke, Hampshire, or Amherst Colleges, are receiving a UMass paycheck, and have a GFAF which lists your contract’s number of weeks as less than 19, please contact our grievance coordinator, Derek Doughty at grievance@geouaw.org.

Number of Hours

We have seen some departments trying to pay experienced Teaching Assistants and Teaching Associates less than new TA’s and TO’s.  The rationale offered for this discrimination is that the department is creating an incentive for people to make adequate progress towards their degree.

The GEO contract does not agree with this rationalization, and this discrimination is grievable.  If you have a contract for 14 hours where someone teaching the same course, with the same responsibilities, has a contract for 20 hours, you should contact our grievance coordinator, Derek Doughty at grievance@geouaw.org.  You should do the same if you are teaching the same course as a previous semester, but your contracted hours have dropped.