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Policies, Union Contracts, Handbooks > Union Contracts
MSU/Coalition Health Care Agreement - January 1, 2006 -December 31, 2009
MEMORANDUM OF UNDERSTANDING
BETWEEN
MICHIGAN STATE UNIVERSITY
AND
MSU COALITION OF LABOR ORGANIZATIONS
Michigan State University (the “University“) and the MSU Coalition of Labor Organizations (the “Coalition”), representing regular employees represented by AFSCME, Local 999; AFSCME, Local 1585; Administrative Professional Association, MEA/NEA; Administrative Professional Supervisors Association; Clerical Technical Union; Fraternal Order of Police Sergeant’s Division, Lodge 141; Fraternal Order of Police Non-Supervisory Division, Lodge 141; IATSE, Local 274; and Operating Engineers, Local 547 (the “Coalition”), have reached the following agreements regarding health care, pursuant to the parties’ 1998 and 2002 Memoranda of Understanding providing for joint labor-management negotiations on health care plan issues:
1. The University and the Coalition have successfully concluded negotiations, with the Coalition acting in the name of its individual constituent unions and associations, concerning health care plan and base wage factor issues. This Agreement shall take effect on January 1, 2006, and shall extend to December 31, 2009, except as provided herein. This Agreement is conditioned on each party’s separate ratification of its provisions.
2. Maintenance of status quo until June 30, 2006.
The status quo, as set forth in the parties’ 2002 Memorandum of Understanding, concerning the current University health care plans shall be continued and maintained for employees until June 30, 2006. As of July 1, 2006, this Memorandum of Understanding will supersede the parties’ Memorandum of Understanding dated January 1, 2002.
3. Changes to the health care plan.
A. Effective July 1, 2006, the current prescription drug plan will be modified as follows:
A four tier program (generic, formulary brand, non-formulary brand, bio-tech) with an annual out-of-pocket maximum of $1,000 per individual and $2,000 per family shall be adopted, with the following co-pay structure:
|
|
Up to 34-day |
90-day |
|
Generic |
$10 |
$20 |
|
Formulary |
$20 |
$40 |
|
Non-Formulary |
$40 |
$80 |
|
Bio-tech |
$50 |
$100 |
* $2 discount for up to 34-day prescription and $4 discount for 90-day prescription at MSU pharmacy. (See Paragraph 6, C, 10)
Note 1: When a non-formulary brand prescription is prescribed and there is no other formulary equivalent, the appropriate formulary brand co-pay will apply.
Note 2: Brand prescriptions written as DAW are subject to the corresponding co-pay of the tier in which they belong.
B. Effective July 1, 2002, office visits for chiropractic services shall be covered under the Community Blue plan with office visit co-pays consistent with other physician office visit co-pays.
C. Effective July 1, 2002 and subject to COBRA rights, if applicable, coverage under University provided health care plans will cease at the end of the month of layoff or termination of employment for reasons other than official retirement from the University.
D. Effective July 1, 2002, and subject to COBRA rights, if applicable, during any unpaid leaves of absence, the University shall not pay for continued dental coverage.
E. Effective July 1, 2002, the following coverage shall be added to the Community Blue program:
· cover minimal office visits
· cover flu serum with no co-pay if within network
· cover prescription contraceptive devices and injections
F. Effective no later than January 1, 2003, IRS qualified health care spending accounts, consistent with the currently offered plan, shall be made available to employees.
G. Effective January 1, 2003, MSU employees will not be able to enroll age 24 or age 25 dependents on a health care plan paid by the University. The MSU employee may purchase a rider for eligible dependent(s). (Dependents who are age 24 or age 25 and enrolled prior to January 1, 2003 shall continue to be covered until their eligibility expires.)
H. Effective July 1, 2006 co-pay amounts for emergency room visits shall be $50; however, if common definitions can be determined for waiving the emergency room visit co-pay for both health plans, then the co-pay for emergency room visits shall be increased to $100.
I. Effective July 1, 2006 co-pay amounts for office visits and osteopathic manipulative treatments shall be $15; however, if an osteopathic manipulative treatment is received during an office visit the total co-pay shall be $15.
J. Effective July 1, 2006 co-pay amounts for treatment at an urgent care facility shall be $20.
K. Effective July 1, 2006 newly hired employees shall receive benefit coverage beginning on the first day of the month following the date of hire.
4. Health Care Plans.
A. Effective on July 1, 2006, and for the 2006-2007, 2007-2008, 2008-2009, and 2009-2010 plan years, the BCBS/PPO and PHP/HMO programs shall continue to be offered to employees of MSU who are represented by members of the Coalition. Except as provided in B. below, the University’s contribution toward the cost of either program shall be the amount the University pays for the program having the lower rates in each plan year. This will be known as the base plan. In each of the aforementioned plan years, the cost of the base health care plan shall be borne fully by the University for full-time employees and proportionately for part-time employees (in accordance with the conditions for part-time employees set forth in C below). Employees electing to enroll in a plan other than the base health care plan will receive the applicable University single, two-person or family base plan contribution toward the plan cost, with the difference, if any, payable by the employee.
B. The Coalition and the University shall monitor the performance of the BCBS/PPO and PHP/HMO programs on an ongoing basis. Performance factors that shall be monitored for each program will include the accuracy of cost projections and data, the cost of each program, the success of cost containment initiatives, cooperation in providing relevant data, responsiveness to other needs and concerns identified by the parties, quality of service, accuracy of claims administration and/or such other factors as may be mutually defined. Notwithstanding what is stated in A. above, as a result of this monitoring process, the Coalition and the University may mutually decide during the life of this Agreement to replace one or both of the aforementioned programs, to designate or change the base plan, to limit or freeze new enrollments in a particular plan, and/or establish or revise the amounts payable by employees enrolling in the plan.
C. Health Care Plan Contributions for Part-time Staff
(1) Effective July 1, 2002, part-time staff will receive a proportional University contribution toward the cost of health benefits based on the single, two-person or family premium for the base plan. Part-time staff electing to participate in the University’s health care programs shall pay the remaining monthly premium.
a. Bargaining unit members who were employed by the University by June 30, 1998, and who are or become part-time, will be eligible to apply for a special dispensation to the University part-time contribution. In these cases, the University’s proportional contribution will be based on the family premium for the base plan. Bargaining unit employees employed after July 1, 1998, are not eligible for a special dispensation.
b. To qualify and apply for a special dispensation to the University part-time contribution, part-time bargaining unit members must submit satisfactory verification that they have no alternative source for health care coverage to the Benefits Office. An employee who falsifies any information in applying for special dispensation to the University part-time contribution, will be responsible for making the University whole for its health care expenditures on his/her behalf.
D. Coverage for married couples and same-sex domestic partners where both are employed by the University.
A married couple or same-sex domestic partner (with both being employed by the University) must elect one of the following options:
(1) Each employee may elect single person coverage in either the base or optional health care plan. Additional dependents may be covered under only one MSU health care plan.
(2) One employee may elect to cover the spouse or same-sex domestic partner and any additional eligible dependents.
Coverage for married couples and same-sex domestic partners where only one is employed by the University.
Spouses or same-sex domestic partners of MSU employees working for an employer other than MSU who have health care coverage available for which they are not required to pay premiums costing more than:
$700 per year effective July 1, 2006,
$750 per year effective July 1, 2007,
$800 per year effective July 1, 2008,
$850 per year effective July 1, 2009,
are only eligible to be covered under MSU’s health care plan if they are enrolled in their employer’s health care plan.
Nothing in this Agreement shall limit the University and the Coalition the ability to access a state, regional or federally sponsored health and/or prescription drug plan(s), or any portion thereof, during the term of this Agreement. The parties agree that they shall have the right to add such a plan(s) to the current health plan and/or prescription drug plan provider(s) with such a plan(s).
As a result of agreeing to consider any such plan(s), the University and the Coalition may mutually decide during the life of this Agreement to replace, change or substitute any existing plan and/or establish or revise the amounts payable by employees enrolling in the plan(s).
The foregoing options remain subject to otherwise applicable conditions and limitations, including those regarding eligibility and proportional benefits.
5. Health Care/Wages
The parties agree the cost of the health care plan and the funding available for wage increases are interrelated.
A. For collective bargaining agreements effective between July 1, 2006 and October 1, 2007 (the 2006 cycle), it is agreed that the Base Wage Factor Average increases for each bargaining agent for the term of this Agreement shall be determined as follows:
1) The aggregate cost to MSU of the health care plans for employees of MSU who are represented by members of the Coalition will be computed for the periods July 1, 2004 through June 30, 2005 and July 1, 2005 through June 30, 2006
a) The aggregate cost computation for the period July 1, 2004 through June 30 2005 (the initial comparison period) will be compared to the aggregate cost computation for the period July 1, 2005 through June 30, 2006 (the ending comparison period) in order to yield a percent increase (or decrease) in Health Care Cost Experience.
b) The funds available for Base Wage Factor Average increases shall be based on the percentage increase (or decrease) in Health Care Cost Experience as shown in the following chart:
|
Health Care Cost Experience |
Base Wage Factor Average |
|
|
|
|
0% - 1.60% |
3.00% |
|
1.61% - 3.20% |
2.75% |
|
3.21% - 4.80% |
2.50% |
|
4.81% - 6.40% |
2.25% |
|
6.41% - 8.00% |
2.00% |
|
8.01% - 9.60% |
1.75% |
|
9.61% - 11.20% |
1.50% |
|
11.21% - 12.80% |
1.25% |
|
12.81% - 14.40% |
1.25% |
|
14.41% - 16.00% |
1.00% |
|
16.01 - 17.60% |
1.00% |
|
17.61% + |
0.00% |
B. 1) Base Wage Factor Average for collective bargaining agreements effective in the succeeding years of this Agreement shall be calculated using the following initial and ending comparison periods in order to determine Health Care Cost Experience for the applicable cycle:
|
Effective Dates of Agreements between: |
Initial Comparison Period |
Ending Comparison Period |
|
July 1, 2007–October 1, 2008
(the 2007 cycle) |
7/1/2005-6/30/2006 |
7/1/2006-6/30/2007
|
|
July 1, 2008–October 1, 2009
(the 2008 cycle) |
7/1/2006-6/30/2007 |
7/1/2007-6/30/2008 |
|
July 1, 2009–October 1, 2010
(the 2009 cycle) |
7/1/2007-6/30/2008 |
7/1/2008-6/30/2009
|
2) The determination of funds available for Base Wage Factor Average increases for the 2006, 2007, 2008 and 2009 cycles shall be based on the percentage increase (or decrease) in Health Care Cost Experience as determined by using the methodology in 5. A. 1) a., above. The applicable Base Wage Factor Average for that cycle shall be that set forth in the table in 5. A. 1) b., above for the applicable Health Care Cost Experience.
A. The following additional conditions shall apply:
(1) The percent of Base Wage Factor Average increases available in each contract cycle shall be the same for each bargaining agent.
(2) Except as provided herein for labor agreements effective on and after July 1, 2006, at no time during the life of this Agreement may the University or any agent of the Coalition bargaining units make any proposals regarding the health care plan and/or any direct or deferred compensation programs (i.e. direct payments to or made on behalf of the employee) and/or any Employer benefit contributions during their separate collective bargaining negotiations.
The University and each bargaining agent shall be free to negotiate on all other matters for their respective union contracts effective on and after July 1, 2006. Failure to reach agreement on an individual union contract shall not invalidate the provisions of this Agreement for its term.
(3) The first contract cycle, the 2006 cycle, shall be defined as the period commencing with the first day of the contract year for the first contract in the cycle and ending on the last day of the contract year for the last contract(s) in the cycle, as shown below:
AFSCME Local 999: July 1, 2006 through June 30, 2007
AFSCME Local 1585: August 1, 2006 through July 31, 2007
IATSE Local 274: September 1, 2006 through August 31, 2007
IUOE Local 547: December 16, 2006 through December 15, 2007
Clerical-Technical Union: April 1, 2007 through March 31, 2008
Fraternal Order of Police Sergeants Division, Lodge 141: July 1, 2007 through June 30, 2008
Fraternal Order of Police Non-Supervisory Division, Lodge 141: July 1, 2007 through June 30, 2008
Administrative-Professional Association: October 1, 2007 through September 30, 2008
Administrative-Professional Supervisors Association: October 1, 2007 through September 30, 2008
For each bargaining unit, each succeeding cycle shall begin one year after the previous cycle begins.
6. Continuation of Joint Labor/Management Cooperation on Health Care.
A. All parties understand and agree that joint discussions between the Coalition and the University’s administration are mutually beneficial and productive, and that such discussions warrant continuation in the future.
B. From January 1, 2006, until December 31, 2009, and subject to 6.D below, the University shall continue to acknowledge and work with the Coalition concerning health care issues. The parties shall continue to meet, discuss and negotiate, as necessary or appropriate, concerning all aspects of the University’s health care plan for the purpose of identifying and implementing necessary and beneficial changes. The parties shall have the authority to implement changes concerning the health care provisions of this Agreement. There shall be no changes to the wage related provisions of this Agreement without ratification by the memberships of each individual bargaining agent of the Coalition. The University shall continue to share data relating to health care plans with the Coalition and direct that carriers and other health care plan vendors share information concerning the program with the Coalition, and the Coalition shall continue to participate in discussions regarding any and all changes to the current programs that may come under consideration as well as annual rate renewal discussions.
C. During the period of this Agreement, from January 1, 2006 until December 31, 2009, The University and the Coalition shall explore additional cost control measures such as:
1. Pursue strategies to enhance compliance for certain therapeutic drugs and evidence-based medical protocols,
2. Mandatory step therapy for bio-tech drugs,
3. Continue to look at other vendors and pricing structures,
4. Require an up to 34-day trial (no initial 90-day supply) for new maintenance prescription drugs,
5. Mandatory mail order,
6. Network discounting by restricting retail networks.
7. Physicians Health Plan becoming an Administrative Service Contract (ASC) provider and/or explore other ASC providers.
8. A lower cost health plan.
9. Alternative criteria for determining the lowest cost (base) plan.
10. Eliminate MSU Pharmacy discount at a time as can be mutually agreed upon.
D. At any time during the term of this Agreement, the University or any bargaining agent may elect to withdraw from joint labor/management cooperation regarding the health care plan by providing written notice to the University and the Coalition no less than three (3) months prior to the effective date of withdrawal. Notwithstanding the withdrawal of a bargaining agent from joint labor/management cooperation, the University and all bargaining agents (including the bargaining agent that withdrew) shall honor and maintain the provisions of this Agreement for the remainder of its term.
7. Wellness and Quality of Care issues.
During the life of this Agreement, the University and the Coalition will continue to work together to assess and address issues concerning wellness and quality of care.
A. This provision requires the parties’ participation in identification of evidence-based quality measures and other strategies to educate consumers and ensure health care plan providers are responsible and accountable for providing the highest quality of care.
B. This provision requires the parties’ mutual commitment to joint participation in the development and implementation of a University wellness program and educational programs and activities.
C. This provision requires strengthening and involving MSU health information and promotion in Joint Health Care Committee activities.
8. Retiree health care and dental plan coverage for regular employees hired on and after July 1, 2002.
A. Upon official retirement from MSU (age 62 with at least 15 years of service credit or 25 years of service credit at any age), an official retiree may then enroll (or continue enrollment) in the health care and dental plan coverage available to MSU retirees. MSU will contribute, only for the official MSU retiree, 100% of the University contribution (excluding any Medicare premiums) toward the lowest cost MSU health care and dental plan. Enrollment in MSU health care and dental plan coverage may be continued for any eligible spouse, same-sex domestic partner and/or dependent(s) if the official MSU retiree pays the full applicable premium cost for the coverage.
B. In the event of the death of an official MSU retiree, or an employee who meets the requirements to be an official MSU retiree, the surviving spouse, same-sex domestic partner and/or dependent(s), if any, may continue health care and dental plan coverage through MSU by paying the full applicable premium cost.
If there is no surviving spouse or same-sex domestic partner, eligible dependents may elect COBRA continuation coverage, if applicable.
The surviving spouse/same-sex domestic partner cannot subsequently add a new spouse/same sex domestic partner and/or dependent(s) to their MSU health care and dental plan coverage.
C. The Coalition will establish a program that allows employees to allocate/contribute untaxed funds for payment of retiree health care expenses. MSU will honor employee requests for payroll deductions to be used for this program.
9. Any changes to this Memorandum of Understanding must be by mutual agreement of the University and the Coalition.
FOR MICHIGAN STATE UNIVERSITY FOR MSU COALITION
OF LABOR ORGANIZATIONS
__________________________________ _____________________________
Scott Sowulewski, Director Wayne Cass, Chairperson
Office of Employee Relations Coalition of Labor Organizations
Date_______________________________ Date_________________________
MEMORANDUM OF UNDERSTANDING
BETWEEN
MICHIGAN STATE UNIVERSITY
AND
MSU COALITION OF LABOR ORGANIZATIONS
RATIFIED BY:
_________________________________
Kenneth Nichols, President
AFSCME, Local 999
_________________________________
James Rhodes, Jr., President
AFSCME, Local 1585
_________________________________
Leo Sell, Chairperson
Administrative Professional Association
_________________________________
Leonard Govoni, President
Administrative Professional Supervisors Association
_________________________________
Debra Bittner, President
Clerical-Technical Union
_________________________________
Daniel Beachnau, President
Fraternal Order of Police, Sergeant’s Division
_________________________________
Steven Brandman, President
Fraternal Order of Police, Non-Supervisory Division
_________________________________
Wally Worden, President
International Alliance of Theatrical Stage Employees
_________________________________
Patrick Quinn, Chief Steward
IUOE Local 547
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