NMG consultant analyzes AP’s health insurance proposal

The health insurance changes proposed by the Associated Press will reduce the company’s budget by more than 20 percent and increase employee costs by 40 percent while reducing benefits, the News Media Guild’s consultant said Thursday.

In response to a question from consultant Sam Camens, the AP said the excise tax on so-called Cadillac health insurance plans, which goes into effect in 2018, is one component of its proposed significant increases.

News Media Guild administrative officer Kevin Keane and the Guild's health care consultant, Sam Camens, discuss issues.

News Media Guild administrative officer Kevin Keane and the Guild’s health care consultant, Sam Camens, discuss issues.

As one example of benefit reductions, the company’s proposal no longer includes a copay-based prescription drug plan for non-generic drugs. While the generic copay will increase to $10 from $7, employees will pay a percentage of cost for brand and non-preferred brand drugs with a new $1,500 out-of-pocket maximum for each person on the plan.

For a chart on the percentage increase of AP’s proposal, click here. 

For staffers on the individual premium plan, the deductible increases to $400 a year in 2014 from the current $150 and for families it goes to$800 from $300 while adding a new feature, the out-of-pocket maximum. The AP proposes that to be $2,400 for and individual and $4,800 for a family.

The company also includes co-insurance of 85 percent; the current plan is now 100 percent. That means staffers also pay 15 percent of medical bills, up the respective caps.

Staffers would pay co-pays of $30 an office visit instead of $20, while emergency rooms co-pays increase to $150 from the current $75.

After all the reductions in the premium plan, the company still wants staffers to pay 57 percent more for their individual monthly contribution or 123 percent if they pay the $50 wellness surcharge. For families, the increase is 29 percent and 46 percent, respectively. The surcharge applies to both employees and spouses but not children.

The individual basic plan premiums would increase 1 percent and 71 percent, respectively. But in 2015, the premium plan would disappear, and the rates for the basic plan would increase 83 percent from 2014 with the wellness program markers and 49 percent without.

The proposed consumer-driven health plan would increase 35 percent and 21 percent, respectively, from the basic plan of 2014. The CDHP deductible is $1,250 for an individual and $2,500 for a family.

The company agreed the proposed increases in employee contributions are significant, but said that’s because rates have been frozen since 2008. AP said the increases aren’t a true-up but recognize the increased cost of health care.

In addition to Camens, others at the table for the News Media Guild were Martha Waggoner, Don Ryan John Braunreiter and Kevin Keane. Camens’ associate, Jessica Watts, joined by teleconference to ask questions about the proposed wellness markers.

Representing the AP were Sue Gilkey, Ellen Fegan, Sally Buzbee, Steve Macri, Jean Maye, Vicki Cogliano, Alison Quan and Keisa Caesar. The company’s health insurance consultant, Tom O’Hara, also was at the table.

Negotiations resume Monday when the company says it will make its economic proposal.