Balancing the business needs of a University with those of its employees and retirees requires foresight, analysis, creativity and stakeholder representation. Adjustments to health care benefits have been the subject of much debate and negotiation in many public institutions across the nation as they struggle to provide quality plans to employees that are financially viable for the long-term.
In order to address these issues at University of New Mexico, a Health Plan Committee was established in Fall of 2014 and tasked with developing options to adjust employee health benefits with goals including: maintaining high-quality and affordable health care coverage to retain and attract premier faculty and staff to carry out the University’s mission; considering the impact of post-retirement benefits and their cost to retirees; and ensuring that any changes are fiscally sustainable by the University.
“The economic challenges we face as a public university, as well as those faced by our employees and retirees as individuals, are precisely why it is imperative to act now and to plan for the future,” said President Robert Frank.
The committee has recommended specific adjustments as to how UNM approaches not only the contributions to its employee health plans, but also how it supports employee wellness and access to health care. These changes are anticipated to work together over time to control health care costs for both the University and those who choose to participate in UNM’s employee and post-retirement health plans. The committee’s recommendations were vetted through the University’s Administrative, Faculty and Staff leadership, and Board of Regents over the past several months.
“In our approach, we are not changing benefits for our employees or current retirees,” said David Harris, executive vice president for Administration. “UNM will continue to provide comprehensive, quality care through a variety of health care plans. Through the careful deliberation of the Health Plan Committee, and input from faculty and staff leadership, we now have recommendations for long-term adjustments that will help us achieve solvency while maintaining excellent, market-competitive health benefits.”
Many of the options considered by the committee and forwarded for adoption enhance the current health benefits. Additionally, a majority of constituent representatives from the Faculty Senate and Staff Council supported the option of blending the health care plans of pre-65 retirees and active employees, resulting in an approximate savings in premiums of 20 percent for pre-65 retirees.
On March 9, the UNM Board of Regents voted to adopt the recommendations for changes to employee health benefits made by the Health Plan Committee, as well as three addition recommendations introduced to the Regent’s Finance & Facilities Committee (F&F), with a progressive timeline for implementing the long-range plan that will begin immediately:
- Increase employee/dependent engagement in disease management and wellness programs through targeted programs and communication. (immediately)
- Continue collaborative efforts with UNM School of Pharmacy to identify opportunities to reduce Rx costs with enhanced service. Explore other options to reduce Rx cost while preserving choice. (immediately)
- Begin full evaluation of the possibility of modifying a current UNM Hospital Clinic or building a new facility dedicated to student, retiree, employee, and dependent only services. (immediately)
- All four employers (UNM,UNMMG, SRMC and UNMH) join together to expand collective purchasing opportunities. Each employer will retain autonomy over contracts/agreements, financial responsibilities, and assets/liabilities. (immediately)
- Develop plan design structures with additional incentives to increase LoboCare utilization across all TPAs . (FY16 or as funds can be identified)
- Evaluate decreasing the number of TPAs administering UNM's medical plans with a goal of moving to a capitated ACO payment model. (FY16)
- Defer the planned .25 percent VEBA contribution increase for VEBA participants. (FY16)
- Continue evaluation of implementing a High Deductible Health Plan (HDHP) and Health Savings Account (HSA) for active employees to be offered in addition to other plans. (FY16 and FY17)
- Partial blending of pre-65 retiree experience with active employee experience and continue with 5 percent premium contribution rate shifts as scheduled (FY16):
- FY16: Retiree 50 percent and UNM 50 percent
- FY17: Retiree 55 percent and UNM 45 percent
- FY18: Retiree 60 percent and UNM 40 percent
- Eliminate post-retirement health benefits for individuals hired after June 30, 2015. (FY16) introduced to F&F on 3.3.15
- Evaluate establishing a surcharge for spouse/partners of active employees and retirees, if the spouse/partner has access to health care through his/her employer. (FY16) introduced to F&F on 3.3.15
- Evaluate FY16 health plan premiums to ensure appropriate rates to cover claims and administrative costs incurred and reduce FY16 premiums for actives and retirees, if possible. (FY16) introduced to F&F on 3.3.15
Further information will be furnished to employees as it becomes available. Visit Human Resources for updates.