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Public Employee Press
New
health care agreement
Pact saves benefits, protects paychecks
The Dec. 18 agreement between the
Bloomberg administration and the municipal unions will rescue a vital
drug benefit for hundreds of thousands of workers and retirees, provide
new money for union welfare funds and save $100 million in city health
care costs. The pact keeps New York City employees among the few groups
in the nation who do not have a percentage of health insurance premiums
deducted from their pay.
DC 37 Executive Director Lillian Roberts called the agreement a win-win
deal and pointed out that it opened the door to renewed wage negotiations.
The MLC, which includes unions representing over 300,000 city workers,
ratified the deal over-whelmingly Dec. 22. In addition to the health care
provisions, the pact will expand the TransitChek program to include a
debit card, giving participants flexibility to vary their monthly payments.
Following is a summary of the provisions:
Pay and benefits protected
- The agreement rescues the PICA
drug program, which faced elimination as costs ballooned. PICA provides
psychiatric, injectable, chemotherapy and asthma drugs for 550,000 city
workers and retirees. A new co-pay structure will help cut costs, which
are estimated at $140 million a year.
- While co-pays will rise in GHI/Blue
Cross and Blue Shield, the HIP/HMO plan will remain without any co-pays
for office and specialist visits and diagnostic services.
- Union benefit funds will receive
an additional $100 per year for each full-time worker and retiree, with
pro-rated amounts for part-timers. This will help the funds cope with
the rapidly rising cost of benefits such as prescription drugs, dental
and optical coverage, legal services and more.
- A major achievement of the Dec.
18 agreement is that members will not have deductions from their paychecks
toward health insurance premiums. Nine of 10 major cities studied by
AFSCME, DC 37s parent union, charge employees part of the premium.
Nationwide, according to the California-based
Kaiser Family Foundation, only 7.2 percent of public and private sector
workers with family coverage did not have to pay a percentage of the premium
in 2003. The average deduction was about $100 per biweekly check.
Early last year as it coped with a $6 billion deficit, the administration
had pressed for substantial premium co-payments to be deducted from members
paychecks.
The city also sought $600 million in benefit givebacks, including the
elimination of retirees Medicare Part B reimbursements. For 2004,
the reimbursement will be $66.60 per month for most retirees and their
covered spouses.
PICA co-pays and changes
Under the agreement, beginning April 1, the PICA program will be modified.
- Co-pays of $5 for generic drugs,
$15 for brand-name drugs on a preferred list, and $35 for non-preferred
drugs will be instituted for all PICA medications, replacing the current
$6 charge that applies only to non-generic psychotropic and injectable
drugs. Purchasers of brand name, non-preferred drugs that have generic
equivalents will have to pay $35 plus the price difference between the
branded and generic medications.
- Mail order purchases of maintenance
drugs will be mandatory, as in the DC 37 prescription drug benefit (see
below).
- A network of pharmacies more familiar
with specialty injectable medications will be able to offer better prices
under the PICA program.
- Fertility coverage involving injectable
medicines will be limited to a 90-day supply.
- Prior authorization will be required
for certain medicines.
- The step therapy system will ensure
that the most cost-effective medicine is used before more expensive
prescriptions are covered.
- Improved prices will be achieved
through negotiations between the NPA division of Express Scripts, Inc.
and pharmaceutical manufacturers. This process will have no effect on
members as they purchase medicine.
- For GHI participants, coverage
of chemotherapy and asthma drugs will be transferred back to GHI CBP
from PICA. This change will be handled administratively and will not
affect members as they obtain their medications.
Changes in GHI co-pays
In the GHI/Blue Cross and Blue Shield plan, where co-pays have not been
raised since 1987, the following changes will be effective April 1:
- Primary care office visit co-payments
will rise from $10 to $15.
- Specialist co-pays will go from
$10 to $20.
- Diagnostic service (lab and x-ray)
co-pays will go from $10 to $15.
- Non-participating provider annual
deductibles will rise from $175 to $200 for individuals and will remain
at $500 for families.
- Hospital inpatient co-pays will
increase to $300 per admission with an annual maximum of $750 from the
current $200 co-pay with a $500 annual maximum.
- Emergency room co-pays will go
from $25 to $50.
- There will be a 25 percent co-pay
on non-mandated in vitro fertilization services.
Senior Care changes
The benefits of Medicare-eligible retirees in the GHI/Blue Cross Senior
Care program will also be modified. As of April 1, the medical deductible
will rise from $100 to $150. Participants who have met the current $100
deductible by March 31 will need to meet the additional $50 deductible
beginning April 1.
The hospital inpatient admission co-pay will go from $200 to $300 per
admission as the maximum rises from $500 to $750.
Administrative fee
The agreement includes a new $35 annual administrative fee, effective
in April, for each covered employee and retiree. The MLC and the city
are still discussing how the fee will be paid.
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