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Collective Bargaining

Collective Bargaining

HONEST BROKER

As the Affordable Care Act (ACA) is implemented in potentially adversarial, or even hostile, bargained environments, there is a need for experiential research. These conflicts require the objective technical knowledge and experiential base of an “Honest Broker”, not of dueling advocates of retained consultants and actuaries. 

The data are real, and should be objectively presented to and understood by all stakeholders.

THE NEED FOR DIRECT SERVICES CONTINUES TO BE IMPORTANT

Objective analytics in collective bargaining are rooted in “principled bargaining”, which is driven by the commitments to data analytics, honest presentation of expected plan results and economic values, and to an economic framework for benefits in which neither side seeks more than it requires.

There is no place to ask for double, expecting to achieve half.

PROVEN EXPERIENCE.  KNOWLEDGE.  OBJECTIVITY.

We have proven experience with this model, in-depth knowledge of principled collective bargaining of healthcare, and is grounded in the academic objectivity of a major public university. The Honest Broker role must be neutral, objective and trusted by both sides in order to address the following questions:

  • How can interest arbitration be informed as to the significance and consequences of the proposals made in the context of health reform?
  • Who can provide labor and management with confidence in neutral fact-based analytics?
  • What financial framework should be used to execute the discussion?
  • How can bargained health plans be progressively modified to avoid the Cadillac Tax in 2018?
  • What plan design modifications can get them there, and what are their values?
  • What strategies can assure protection and viability for pre- and post-65 retirees?
  • How can Labor make concessions and benefit simultaneously as part of overall compensation? 

THE AFFORDABLE CARE ACT HAS MAJOR IMPLICATIONS FOR EMPLOYEE HEALTH PROGRAMS

Some changes pose significant threats and substantial complexity for self-funded plan sponsors anticipating change. 

One threat is the Cadillac Tax, which will impact plan sponsors in 2018.  The self-funded plan’s position may be exacerbated by the development of private exchanges, in which larger employers will more widely adopt defined contribution approaches, limiting both the liability for medical trend on traditional plans and avoiding the Cadillac Tax.

The effects of ACA and the Cadillac Tax will be the disproportionately borne by collectively-bargained plans in both private and public employers, and by the Taft-Hartley multi-employer plans.  The multi-employer plans may be compelled to pay millions of dollars that are structurally unavailable to recover and sustain benefits. 

CONFRONTING CRISIS

Public employers are confronting the crisis of affordability of health and pension benefits, as well as the Cadillac Tax, for which the offset comes from reductions in bargained benefits or higher taxes.  As demonstrated on the state and county levels in Illinois, there are no easy resolutions. The context for resolution is complicated by demands for concessions, not necessarily because benefits are too rich but because they are unsustainable, or because public pensions were not adequately funded.

SERVICES AND RESOURCES

CEHS, along with its staff and affiliates, has a deep reserve of experience and resources to address these issues. The services and resources include:

  • Situational assessment (stakeholder interest and issues definition)
  • Stakeholder parameters (management and labor)
  • Financial framework feasibility assessment  (data evaluation and gap analysis)
  • Claims data analysis, profiling, benchmarking and plan values
  • Enrollment population analysis
  • Benefits modeling, alternatives pricing
  • Cadillac tax projections and navigation mapping

The Collective Bargaining Research and Services Overview is now available for download and print in pdf. Click here‌ to download.

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