Melissa Bailey Photo
Cherlyn Poindexter, Local 3144 president, calls for a time out.
After unions balked at a plan to save an estimated $2 million by switching health care companies, lawmakers sent the proposal back to committee.
That was the result of a unanimous vote by the Board of Aldermen on Wednesday evening.
Westville Alderman Adam Marchand, one of the architects of the proposed insurance carrier change, said unions will be invited to join the Request For Proposals (RFP) committee that chose the new carrier.
Marchand said sending the plan back committee is a way to make sure the process is done right and all union concerns about health benefits are allayed.
Marchand said the lack of Summary Plan Descriptions (SPDs) in the RFP responses was a “fundamental problem.” (More on that below.)
Jimmy Kottage, head of the firefighters union, hailed the move back to committee.
“I think it’s the right thing do because we all have a shared interest in savings but they need to get this RFP right,” he said. “I think it’s been flawed throughout the process.”
Kottage said he filed a grievance on it a week and a half ago.
An earlier version of this article follows:
Unions Seek To Halt Health Care Switch
With lawmakers poised to vote Wednesday on a proposal to save an estimated $2 million by changing health care companies, seven unions are calling on the city to put the plan on ice.
The proposal comes for a vote before the Board of Aldermen Wednesday night. It would allow the city to begin negotiating with Cigna to take over the administration of the city’s health insurance. Cigna would take the place of Anthem, which has held the contract for over three decades.
Supporters of the change say it would save the city over $2 million without affecting the health benefits employees receive. Cigna offers savings in fixed costs and is expected to provide lower health care delivery fees.
Not everyone is on board with the change. Seven union heads sent the Board of Aldermen a letter last month asking lawmakers to table consideration of the plan until unions have a chance to vet it properly.
Westville Alderman Adam Marchand, who helped choose Cigna to take over the health care administration contract, said he’s open to the possibility of delaying Wednesday’s vote. He said he’s committed to addressing every question unions have about the change. He and Chief Administrative Officer Rob Smuts said they will take whatever time is necessary to allay union concerns.
The proposal at the center of the controversy would save the city over $2 million, Smuts has said. The shift would not be a change to benefits, merely to a more efficient administrator, he and Aldermen Marchand and Jessica Holmes, members of the Board of Aldermen’s Health Benefits Review Taskforce (HBRT), all said.
Click here for a detailed explanation of the proposed change.
Holmes and Marchand sat on the RFP (request for proposals) committee that recently selected Cigna to administer the city health insurance. An approval by the Board of Aldermen would allow the city to negotiate the final details with Cigna. At that point, unions would decide whether to go along with the change.
The letter asking for a delay in the process came from the heads of the management, custodians, public works, blue collar, clerical, daycare, and paraprofessionals unions.
It calls the RFP process “virtually incomplete and illegal,” because bidders were not given, nor required to submit, all relevant documents. The letter says that the RFP did not include the current health care plan’s Summary Plan Description (SPD), nor were bidders required to submit SPDs of their own. “The SPD is a vital document, which illustrates the specifics of the plan and provides a detailed explanation of coverage,” the letter states.
Without comparing the existing SPD to any proposed new SPD, it’s impossible to ensure that employees’ health care benefits will not change, the union leaders argue.
“The city has announced they will be implementing the Cigna plan and we have no indication as to what benefits Cigna is going to provide,” the letter states. “We want to have the opportunity to review both [Anthem and Cigna’s] RFPs to ensure that the health benefit package provides the same health benefits to our members.”
Smuts said RFPs don’t include SPDs. “That’s not how an RFP would work. That’s not how it worked last time,” he said. “They are right that you need to compare [plans] at that level of detail, but that’s not what you do in the level of an RFP.”
First the RFP committee goes through its process, “then we go through and hammer out that exhaustive level of detail,” Smuts said.
“That will happen, sure,” Smuts said. “We’re going to have to get side by side comparisons and show that benefits don’t change.”
Last month’s letter to the Board of Aldermen also included complaints that unions were shut out of the RFP process, a charge that was also leveled last month by the heads of the police and fire unions.
“None of our unions were notified that the city had chosen a new health benefits provider,” states the letter. Unions were not given an opportunity to review Cigna’s proposal, or ask questions, before the RFP committee selected it, the letter states.
Alderman Marchand said he and Alderwoman Holmes asked the administration early in the process to have unions represented on the RFP committee. “The administration didn’t think the time was right,” Marchand said. “The time is right for it now. I’ll be talking to the administration about how to proceed. It would have been great to have [the unions] at the table.”
Smuts has said that since the RFP process is just an administrative one, which affects only the delivery but not the substance of benefits, unions haven’t historically been on the RFP committee. Smuts has said he’s open to finding a way to have unions at the table in the future.
Marchand and Smuts both said they are in no hurry to make the change from Anthem to Cigna, at least not before all union concerns are addressed. “We’re not trying to rush anything through,” Smuts said. He said he expects to be able to sit down with unions in a couple of weeks.
“Unions represent hundreds and hundreds of members,” Marchand said. “Having them on board is important. … We’re not interested in chief stakeholders feeling like they were excluded. … I’m open to doing whatever it takes to make sure those key groups are on board.”
Cherlyn Poindexter, president of AFSCME Council 4 Local 3144, said she wants to “make sure the plans are not diminished.”
“We’re all for savings anyway we can get them,” she said. “But we have to make sure the savings are real.”
Melissa Bailey contributed reporting.
I'm surprised that there is no mention of the level of disruption of physicians used by plan members. This is a standard analysis that a bidding insurance provider would usually submit as part of the RFP process. Even if the plans are comparable between Anthem and CIGNA, that wouldn't matter if a large minority of employees find their primary care physician or physical therapist or another medical professional they use regularly out of network with the new plan.