Why shouldn't we all pay the same amount?

Three Reasons:                  

     A) We are trying to reduce costs.  We will not be able to continue paying the healthcare increases coming down the road.  Aon, our consulting firm, negotiated two rate caps—12% this year and 16% next year.  But they project a 30% rate increase the following year. In our Focus Groups people said they want to keep the current plan.  That may not be possible.  In two years, we may be compelled to re-design the plan. Every step we can take now to moderate that increase will keep the plan for everyone.               

     B) It is not fair. The premium for Family coverage (member plus dependents) is $378 a week.  The cost for Individual (member only) is $138 a week.  That’s a spread of $240.  When rates were low, it might have been fair to divide the bill amongst everyone. But now it is not.               

     C) It encourages those who can get fully paid coverage for spouses or dependents elsewhere to change their coverage to Individual and reduce their cost from $35 to $10 a week. Shifting members from Family to Individual coverage saves the fund money and will be necessary to maintain the current plan. 

Are the $10 or $35 contributions pre-tax dollars?

     Yes. Since the contributions are diverted from future wage increases, under current law they are benefits that are not subject to either federal or state wage taxes.

What about increasing co-pays rather than requiring a weekly contribution?

      First, our focus groups said members wanted to keep this plan as it is.  Second, we looked for plans that were less expensive with greater co-pays but found these plans did not save us much on the bottom line. In fact, members would get hit twice—with having to pay out-of-pocket and with increased co-pays for things like lab work, specialists and hospital stays.

Have we considered a different plan than Blue Cross?

    Yes.  We put out Requests for Proposals on all our Health and Welfare benefits—Medical, Long Term Disability, Dental, and Vision. We already have switched to self-funding on prescriptions, Vision and Dental. For medical, Aetna was very interested and appeared committed to outbidding Blue Cross but in the end they could not match our plan for benefits or costs.  

What if I switch to my wife/husband's plan, can I leave our health plan entirely?

     At present we do not have that as an option.  There are several legislative roadblocks.   

Pension:

Will I be forced to contribute toward my pension?

     Future contributions to the pension fund will be addressed through diversions (see below).  Right now, it will take about $7 million to continue to accrue pension benefit service credit for every active pension plan participant at the same level as in previous years until we have a new contract in 2009.  We have $4 million set aside for the transition.  We are looking at alternatives to deal with the shortfall.  As soon as we have a solution that is acceptable to the Guild, the employer and the Trustees of the pension plan into which our plan will merge, we will let you know.

How much will I have to pay into my pension?

     As referenced above, in the future, contributions to the pension fund will be made on the basis of diversions.  Diversions are future wage increases that the Guild bargains on your behalf that will be diverted as contributions to the pension fund.  This is the way that all of the other unionized employees of The Inquirer and The Daily News fund the contributions to their pension plans.  Long before collective bargaining for the next contract will begin, the Guild will formulate a strategy to provide for wage increases and diversions to fund future pension benefit service credit. 

Will the money be pre-taxed?

Since the contributions are diverted from future wage increases under current law they are benefits that are not subject to either federal or state wage taxes.

Will my contribution to the pension affect my 401K?

     No, the Pension is an entirely different entity.  The pension is classified as a defined benefit and the 401(k) is a defined contribution.  The rules and requirements for each are different. 

What's taking so long with this pension situation?

    Employee retirement benefits are controlled by the federal government under ERISA (Employee Retirement Income Security Act) which governs employee retirement benefits.  Decisions about the pension are entrusted to a board of trustees, which is made up equally of Labor and Management members.  The trustees are guided by pension lawyers, pension actuaries and pension investment counselors.  The trustees are required to act for the best interests of the plan and of the participants.  Every step of this process is scrutinized by trustees for each side and their advisors.  We are required to thoroughly investigate all potential merger partners and those partners must investigate us.  We are down to two possible partners—soon to be one.  It should move very quickly after that. 

Why haven't we been provided more information?

     Trustees are required to act together in making decisions.  Sometimes these decisions are far-reaching and affect lives.  Trustees have an obligation to act in the members’ best interest and legal obligations to potential partners to keep information confidential until a decision has been made.

The Union for the information age