Last spring Southwestern College employees dodged a bullet that would have sent health insurance premiums sky high. This spring the gun is cocked and pointed at employees' heads with the same bullet.
Beginning July 1, SWC employees will see an average 70 percent increase in pay deductions for their health benefits.
Only one of SWC's nine insurance plans avoided hikes in out-of-pocket dues. PacifiCare HMO, one of SWC's moderate insurance carriers, increased its rates across the state by 12 percent, but SWC employees with this insurance saw their out-of-pocket dues increase by 65 to 75 percent.
SWC Biology Professor Nira Clark, like many professors, was upset.
"What happened out there?" she said in a campus-wide e-mail. "Why do I now have just two weeks to decide if I can afford the extra $12,000 a year?"
Former SCEA President Janet Mazzarella said the college needs to join a local insurance consortium. These insurance groups pool together companies and approach insurance carriers with greater bargaining power. But consortiums will not partner with SWC, she said, because of an existing SWC "opt-out" policy which allows employees who began before 2005 to trade their insurance dues for money.
About a quarter of the employees at SWC choose to take home about $4,000 a year rather than receive benefits, said Mazzarella.
"The cash-out philosophy makes our premiums sky high," she said. "Part of the insurance premium quote utilizes a risk and utilization factor. If healthy people opt-out and take the cash, that option leaves the rest of us with high premiums."
Mazzarella was part of the search for new options last spring. She said that a local healthcare consortium with tens of thousands of members made the college a one-time offer that would have lowered SWC insurance costs. The consortium wanted the college to end its opt-out policy within three years. Mazzarella said SWC could not close the deal.
"We had a good deal on the table, but it was a take-it-or-leave-it proposition and unfortunately, we left it."
Mazzarella also said the college's insurance broker, Keenan and Associates, have little incentive to find SWC the best deal.
"They receive commission," Mazzarella said. "They come to the table and put on a face of concern over our issues but in the end, the more we spend, the more they make."
Vice President for Business and Financial Affairs Thomas Beasley and Vice President for Human Resources Michael Kerns were not available for comment.
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