THE UNIVERSITY OF OKLAHOMA

 

STAFF SENATE

 

(NORMAN CAMPUS)

 

Wednesday, September 19, 2007

 

 

Chair Beth Gatewood called the first meeting of the year to order at 1:32 p.m. in the Scholars Room of the Oklahoma Memorial Union.

 

Officers present — Beth Gatewood, Chair; Linda McCarty, Chair-Elect

 

Officers absent — Betty Love, Immediate Past Chair; Patsy Montoya, Recording Secretary

 

Staff present — Barbara Perry, Administrative Coordinator; Shanika Bivines, Administrative Assistant

 

Representatives present — Hourly Employees Council: Diana Fitzpatrick, Ed Fontaine, Robert Murphy, Kim Haddad, Jack Shoopman, Melanie Wilburn, Donna Stephens, Carolyn Irons, Dee Hayes, Ben Stapp, Troy Schmidt, David Kizer; Informational Staff Association: Debbie Copp, Lisa Bowles, Elaine Bradshaw, Michael Goodwin; Organizational Staff Council: Cathy Brister, Sandi Emond, Cathy Trujillo, Kathy Gross, Matt Berry, Jannie Porter; Administrative Staff Council: Sue-Anna Miller, Robbie Wahnee

 

Representatives absent — Hourly Employees Council: None; Informational Staff Association: Anna Love, Debi Gentis; Organizational Staff Council: None; Administrative Staff Council: None

 

Guests present — Julius Hilburn, Human Resources; Nick Kelly, Human Resources; Kris Glenn, Parking and Transportation Services; Theta Dempsey, Parking and Transportation Services; Susan Grossman, College of Continuing Education; David Houck, Physical Plant; Sean Byrne, Human Resources; Linda Smith, Price College of Business; Tami Kinsey, Department of Economics; Scott Mahaney, Department of Economics; Nancy Matthews, Department of Mathematics;  James Tyree, The Oklahoman; Tiffany Hess, The Oklahoma Daily;  one unidentified guest

 

REPORT FROM KRIS GLENN REGARDING “FILL THE TROLLEY” CAMPAIGN

 

Chair Beth Gatewood introduced Kris Glenn from Parking and Transportation Services. Kris passed around a flyer explaining CART’s “Fill the Trolley” campaign which began in 1986 by literally filling a trolley with food and toys provided from the University community.  The campaign’s mission is to ensure that less fortunate Norman families have a quality holiday season.  CART will leave a decorated holiday box with any group that would like to participate by donating household items or toys.  Kris said new or used items could be accepted.   Boxes will be delivered November 1st and will be picked up a month later, around December 5 or 6th.   In December, elves will pick up the boxes and Santa will drive the trolley to the Cleveland County Christmas Store where underprivileged families can shop.  A Senate member volunteered to be Santa!  Kris said they reached out to the business community and the City of Norman last year for assistance, but this year they were appealing solely to the generosity of the University community.  They would like to be able to fill two trolleys and present it as a gift from the University.  Kris said several departments had already agreed to participate.  Kris encouraged people to get involved.  He said when the University community comes together, it creates a great impact for the City of Norman. 

 

CHAIR’S COMMUNICATIONS

 

Beth reported that she and Administrative Coordinator Barbara Perry had attended the Faculty Senate meeting on September 10th at which President Boren gave the State of the University address.  He spoke about the pilot text book program that is assisting students with the high cost of text books.   She reported on some of the five-year goals he discussed: an 18:1 student to faculty ratio; continued growth of the research campus and reaching $100 million in scholarship endowments.  President Boren said that OU was the third university to join the Chicago Climate Exchange to assist with the environmental commitment and that OU was using wind power, practicing recycling, upgrading lighting in the buildings and converting to electrical and ethanol vehicles on that front.  Beth said she had information about the budget structure and would be glad to share that information as well.  On September 7th, the Executive Committee met to discuss the Health Insurance Contribution Strategy Final Report and prepared a response to President Boren.   On September 13th, Beth met with Vice President for Executive and Administrative Affairs Nick Hathaway.  The budget was discussed.  He will keep us updated on that.  Nick expressed appreciation for our letter of response to the final report on healthcare.  Regarding the final report, Nick thought the president might be inclined to take a slightly different approach, but one that would get us moving toward a contribution strategy program.  The Executive Committee met on September 14th to select three staff names to forward to Provost Mergler.  From the list of the three, one nominee will be selected to serve on the Search Committee for the Dean of the College of Architecture.

 

ACCEPTANCE OF MINUTES OF JULY 18, 2007.

 

On motion by Matt Berry, the minutes of the July 18, 2007, minutes were accepted as written. 

 

OTHER COMMUNICATIONS

 

Administrative Staff Council:  President Sue-Anna Miller reported that the ASC met on September 18 for a lunch bunch meeting complete with sandwiches.  The group discussed making changes to their meetings in order to increase attendance.  They are considering joining with other member groups and inviting some of the vice presidents to address the larger meetings.  They also discussed the final report on healthcare. 

 

Hourly Employees Council:  President Diana Fitzpatrick reported that HEC met on September 12 and welcomed their new members.  They signed up members for subcommittees and briefly discussed the final report on healthcare.

 

Organizational Staff Council:  President Cathy Brister said OSC met on September 6.  The group held a luncheon meeting and elected a new Vice President/President Elect, Sandi Emond.  They discussed speakers for the year and the final report on healthcare in some detail. 

 

Informational Staff Association:  ISA member Debbie Copp reported that ISA met on September 5.  The group elected Michael Goodwin as their new Vice President/President Elect.  They discussed the types of programs they would like to hold this year.  For every other meeting, ISA may host a speaker or it may be an outside event or a tour of some type.  The group collected donations for the Angel Food Ministry Program. 

 

STANDING COMMITTEES

 

Communications Committee:  Chair Susan Grossman said the Communications Committee had met earlier that day.  The group is making plans for a town hall meeting to be held with President Boren.  They are hoping he will be available in early October.  The committee discussed several ideas they would like to pursue this year.  They plan to create a site to which people may ask questions anonymously on the Communications Committee’s web site. The question would be answered or routed to the appropriate department for an answer. 

 

OU Staff Week Committee:  Chair Melanie Wilburn reported that the Staff Week Committee met on September 6th and discussed the fall sweatshirt sale.  The committee plans to use last spring’s logo on a sweatshirt this fall and they are considering using a new logo on a hoodie.  The group discussed conducting a chili cookoff for a new fundraiser. 

 

 

INSURANCE UPDATE BY JULIUS HILBURN AND NICK KELLY, HUMAN RESOURCES

 

Director of Human Resources Julius Hilburn said he was there to update the group on the Final Report from the Contribution Strategy and Health Insurance Options Committee and discuss the process going forward.  He said the recommendations had been developed out of a series of meetings that had taken place over the past five months.  Although the Final Report had been issued, Julius said it was not a done deal and nothing was final at this point.  Julius said the report had been sent to the president.  He said employees would soon receive a memo from President Boren acknowledging that he was reviewing the committee’s recommendations and sorting through the difficult decisions that come with changes to the healthcare plan.   Julius encouraged people to read the reports.  He said he would explain what the committee had recommended and the rationale to support the recommendations.   He said those who had served on the Employment Benefits Committee had discussed on many occasions the need to have a healthcare program responsive to the needs of single employees as well as plans that offered more affordable dependant options.  EBC wrestled with this conflict for many years. 

 

The Contribution Strategy and Healthcare Options Committee was charged by the president to take a look at our current health care plans and how those plans are funded.  The committee looked at our competitive position – how our plans compare with people we compete with for talent and looked at ways we might help employees with wellness programs and incentives for healthier lifestyles.   At the end of the process the committee came up with recommendations for changes that meet the needs of employees, retirees and the University.  (Julius recapped the guiding principles and much of the information that was presented at the July meeting.)  He then addressed the following questions and issues:

 

Julius said they could not determine how many people have dependants to cover, but in our plan, only 25% of our employees cover dependants.  In other institutions about 50% of employees cover dependants, so they believe it’s our contribution strategy that has caused employees to seek coverage elsewhere.  Since 2003, the number of people who cover dependants at OU has dropped from 1,500 to 600.  Julius said they believe it is due to the rapid increase in cost for dependant coverage.  A number of hiring managers have sited the high cost of medical coverage as an issue when recruiting new employees.  

 

Julius said they don’t want to go to market every year and chase the best deal.  Every time we do, there is disruption, even if there is a better deal.  He said they have made several changes to our vendors over the last five years. He said we have to try to balance avoiding disruption with trying to make sure companies compete for our business.  We should probably go to market every three to four years.  2008 will be the fourth year with Aetna.  The number of vendors that might be interested in our business is different now than it was four years ago.  Blue Cross/Blue Shield is now a much more viable bidder than it was four years ago.  Oklahoma BCBS has merged with BCBS from other states, and OSU recently did an RFP and chose BCBS at the end of the process.   Julius said they looked at Aetna after their negotiations with them this year and the Committee is recommending eliminating the hi-option HMO plan.  They are also going to recommend some minor plan design changes for the Aetna Health Fund.  It appears to be a better high deductible plan than some others they had considered. 

 

Julius said OU is big enough with 9,000 to 10,000 employees to insure.  That allows us to develop and specialize our benefits to meet OU’s needs.  If we were part of a coalition, we would need to agree on the same set of benefits as the other colleges whose needs could differ from ours.  We don’t want to lose our flexibility by joining a coalition and it does not appear that it would give us a better price by doing so. 

 

Julius said there would be a continuing effort from the Committee to develop wellness initiatives.  He said he expected to see some recommendation for formal programs set up and funded to promote wellness. 

 

Julius said the Committee looked at 11 different contribution strategies as they made a recommendation.  Part of the reason they were so close to the regents’ meeting date to issue the final report was that they kept sending the consultant back to figure out additional ways to meet the guiding principles and come up with a recommendation that the Committee could support.  In order to have competitive rates for people covering spouse or family they needed to make a major change to the OU contribution strategy.  That improves OU’s ability to attract new employees that need dependant coverage.  It also improves our current mix of plan participants.  Right now the only people covering dependants under our plan are people who can’t find a better option outside our plan.  That generally means that the people on our plan are those who don’t medically qualify for private policies.  So our group tends to be less healthy and more expensive to cover.  Julius said the Committee felt that for OU rates to approach the benchmarks the University would need to provide some additional funding and employee contributions at some level would be required.

 

Julius said the Committee identified the need to have affordable premiums for the lower paid employees.  That was one of the goals that kept sending the consultants back to the drawing board.  The Committee’s recommendation was that OU should increase funding for health insurance benefits by $2 million in 2008 and implement a four-tiered compensation based contribution structure for employees.  Employees may qualify for the lowest premium based on family size and income.  The Committee determined the median salary to be $42,000.  50% of our employees make less than this.  Anyone in this group would get the lowest premium, other than the low income subsidy.  (See Appendix A of the Final Report for the Four-Tier Contribution Structure for details of all four contribution structures.)  Julius explained that employees must qualify for the very lowest tier, the low income tier, which is based on family income and size.  This tier allows a family to earn up to 200% of the federal poverty level to qualify (see Appendix B included in the Final Report).  Under this tier, there is no contribution for employee only and competitive prices for family coverage. 

 

The Committee recommended no change in retiree rates for 2008 (Appendix C).  It reflects only the change in rates for renewal with Aetna.  Julius addressed whether OU should change age of service requirement to qualify for retiree medical coverage in the future.  Presently, an employee can qualify for fully paid retiree medical benefits with as little as ten years of service at age 62.  The Committee recommended that people hired on or after January 1, 2008, will have a different retiree medical benefit than those who are already employed.  Details will be worked out later.  There will be no change to the program for retirees and for those active employees who are eligible to retire.  We have employees who have met the age and service requirement to retire and we don’t want them to think they have to leave to preserve the deal they are expecting.  Julius said they would look at service based employer contributions for retiree medical coverage for other active employees.  He said the notion is that people who work longer for OU should qualify for more as an OU retiree.  There would be a distinction between a 25-year career and a 10-year career.  Julius said the Committee needed more time to study this. 

 

Julius then answered questions from the group.  A member wanted to know why the $50 credit was given to employees to opt out of the healthcare plans.  She said it was difficult to understand how they could encourage people to bring dependants into the plan, yet encourage others who have an outside plan to remain outside.  Julius said the $50 payment could be incentive for those who, for instance, were already covered on their spouse’s plan, and did not need OU’s plan.  They could opt out, take the $50 and the University would not purchase insurance for that individual, resulting in a monthly savings to the University of approximately $350.  He said the employee must provide proof they have other coverage in order to opt out.  A member commented that some employees who purchased insurance from outside vendors found great rates the first year, but then their rates went up and now those employees wanted to come back into OU’s plan.  Julius agreed that the private insurance companies do cherry pick who they take, but group insurance plans like ours don’t exclude based on medical history. 

 

An Hourly Council member commented that the people being recruited to work here were not going to be making $42K or less, the people being recruited are the ones making money in the upper figures.  In his shop, the Trades, he said, “It’s not about benefits, the pay is too low!”  It was his feeling that the recruitment issue affected a small percentage of the employees, that it affected the upper echelon of faculty or staff making far more than $42K, and that the issue could be dealt with in their contracts or hiring packages.   Julius said that with today’s costs, a person with dependants would be looking at $800 a month for family coverage.  He felt it was a bigger deal for people making $40K.  He said very few of those people elected to cover dependants because they could not afford it.  Julius said as an employer we have to be balanced and be competitive with the benefits we provide and be competitive with the pay.  If you are benefit rich and don’t get it right with the pay, you have a problem or if your pay is right, but your benefits are off, you have a problem.  The Committee looked at the problem and tried to address diversity – people with or without families.  A member commented that the people here now are the future and there was no guarantee that those being hired now would be as loyal as those who have put in the many years of service.   

 

Chair-Elect Linda McCarty read a letter she had received from a constituent. “I’d like to express my profound disappointment with the recommendations contained in the Final Report of the Contribution Strategy and Health Insurance Options Committee.  All politics are local when it hits one’s pocket book, and I’ve put the calculator to how it is going to affect mine, and it’s considerable.  I am currently enrolled in the Open Access Plan.   Assuming I stay with that plan for the 2008 coverage year, it will cost me $900 more per year than I have been paying    I have been told that the family rates are being lowered to encourage people who have family coverage outside of OU to switch plans.  I currently pay $252 a month for family coverage with Blue Cross and Blue Shield. The family option offered by OU would cost be $484 which is an additional $232 more than what I am currently paying.  So I end up paying $900 more to stay the same or $2784 to switch to OU’s family coverage.  They are apparently reducing the cost to insure dependents of OU employees on the backs of those of us with no dependent coverage – and that’s not fair.  I also find it remarkable that the top tier for calculating how much a given employee will have to contribute for his/her health insurance coverage is $60,000.  Why aren’t there a number of other tiers above the $60,000 level?  I know, having access to budget information, there are many individuals at the University that make substantially more than the $60,000.  In fact, there are many that earn more than $100,000 per year and yet they pay the same rates as I do which seems patently unfair.   I hope that this plan will not be approved as recommended by the Contribution Strategy and Health Insurance Options Committee at the October 2007 meeting of the OU Board of Regents.  I know something has to be done to address the rising cost of health care coverage, but this recommended change isn’t it.”

 

 Linda then asked some questions and commented on some issues.  How can you determine what is low income or if it is a hardship on someone?  Even if a person qualifies for the lower tier with their tax return, there are a lot of spouses that are paid cash under the table.  Regarding the peer institutions paying towards family and dependant coverage, how do OU salaries compare to the salaries of the peer institutes?  Of the 900 that have dropped out of OU insurance, how many of those dropped because they no longer needed the insurance?  With this plan, if both spouses work at OU, that household is going to get hit twice.

 

Julius said they are still considering what to do when both spouses work at OU. Currently, they don’t have the ability to give a separate rate for a two-income OU family with Aetna this year, but they will seek that provision in their 2009 contract when they go out to bid.  Regarding how OU salaries compare to the salaries of peer institutions, Julius responded that HR had met with components of the Executive Committee of the Senate to discuss this.  He said he realized there was interest in determining whether OU pays competitively and how we compare with the peer group (used in the insurance study).  Julius said it depends on the nature of the job.  A job that is common at other universities and is recruited regionally or nationally will have data through CUPA HR.  That can be used to benchmark the OU jobs with others. When comparing benchmarked jobs, OU does not appear to be out of line. They look at local employers for hourly jobs or jobs recruited locally on an ongoing basis.  Julius said they could not capture the data that would allow them to rank OU as a number in the Big XII for comparison purposes within the Big XII.   He said the data obtained for the report looked strictly at competitiveness of benefits.   

 

The comment was made that OU is a Flagship University and benefits should not be our only concern.  We should be concerned with raising salaries so we don’t have so many people at poverty level or lower income levels.  Julius pointed to Appendix B.  He said a family of four at 200% of the poverty level would earn $41,300.  He said we could have employees who are paid competitively and meet that criteria.  Responding to the question about the 900 employees who have dropped out of OU insurance, he said there was no way to be sure why they had left the plan, but he thought that most of them voted with their feet by finding more cost effective plans as the rates tripled.  Julius said people are continually going off and coming onto the plan at the same time, but they felt the biggest reason people left was because they couldn’t afford the high rates.  Julius said rates go up and they see people leave the plan.  Most of it happened in 2004. 

 

A member commented that her biggest concern is that once we start contributions, it won’t stop.  She said she could envision healthcare rising, 10, 12 or 15% and that perhaps it would be easier to increase the employees’ share of insurance rather than negotiate a better contract with the agency.  She asked, “How far does this go?”  A member asked how an employee would show they were low income.  Julius said they were still working out the details.  They are considering using a 3rd party to preserve employee privacy.  The University could get a certificate stating that the person had provided the evidence and that they had qualified. 

 

Julius was asked if employees would be allowed to opt out if they have to start paying for their insurance whether they have other coverage or not.  The monthly payment could cause a hardship for some people.  Julius said people would still need to provide evidence that they have other coverage to be able to opt out.  As an employer, it is OU’s responsibility to make sure the people who work here have insurance coverage. 

 

Debbie Copp said she was a Staff Senate representative on the Employment Benefits Committee.  Debbie said some had commented that  it was ironic that when interviewing people we are not allowed to inquire about their marital status or children, but once they are on campus, the first thing we do is figure out how to pay for insurance for their spouse and children.  She suggested looking at a total compensation package that includes retirement, salaries, healthcare, dental and life insurance.  A cafeteria plan with all these elements, so that a person needing more dollars to insure their family could target their dollars to that effort and put less toward retirement at a particular point in their career; whereas, an employee past that point in life with no children at home and closer to retirement might shift more of their dollars toward retirement.  Debbie asked if this concept was possible. 

 

Julius said they had heard that recommendation before, but he did not think it would be doable with IRS.  He said they had not seen any other employers with that type of plan.   Cafeteria plans usually don’t include the retirement benefits.  Debbie said if we are trying to be a Flagship University, it would be good if the University could be the leader.  She said we had focused on healthcare benefits, then on salaries, then on retirement, when we really need to be focusing on our total compensation package.  She said the University would be paying an additional $2 million toward healthcare this year, but the greater share of the cost, $4 million, is being shifted to the employees, and salaries aren’t keeping pace.  She said, “People know what their raise is going to be and they know they will make less money this year.  I think that is tragic.”  A member commented that he was a plumber by trade and he was willing to take less salary because of the benefits, but that really didn’t make up the difference anymore. 

 

Concerning retirement eligibility, Julius said people who are currently eligible to retire will be treated the same as people who are already retired, so there is no motivation for them to do anything.  Julius questioned where to draw the line beyond that.  If a person is two or three years away from qualifying for retirement, do you treat them the same as the people who have already retired?   He said it was likely that people who are 20 years away from retirement would have their retirement based on years of service, but the Committee needs to do more study to sort all of this out. 

 

A member asked whether the pre-health screenings, weight loss management and smoking cessation programs should be offered as part of the medical plan or by OU since we have Goddard, Houston Huffman and HSC as part of our community.  Julius said some of that could still be determined, but some things do need to be included in the medical plan.  They know they want to include smoking cessation options, nicotine replacement therapy and behavioral modifications in the plan, but they haven’t added anything yet for weight management issues.  Some things could be included as plan benefits and OU could sponsor a walking program as a wellness initiative. 

 

In closing, Julius said there were a substantial number of employees who were underinsured or not insured at all from all salary levels and types of employees.  Dependent healthcare is a major issue for some.  Julius said the report was issued so close to the deadline because there was active debate in the Committee over what to recommend.  The president has the report, is reviewing it and receiving feedback from people from across campus.  Julius said there a decision had to be made concerning what to do for 2008.  The Committee had recommended that contributions begin in January 2008.  Beth asked people to send in any additional questions or comments to healthcareoptions@ou.edu.    She said it was important to remember that President Boren had not made a decision at this time on what will be presented to the regents.  She thanked Julius for the information he had presented. 

 

Nick Kelly announced the Retirement Education Seminars being held on September 25 from 9 – 4:00.  Vendors from Social Security, Fidelity, TIAA-CREF, and information for people close to retirement or those just starting to invest would be available. 

 

REPORTS

 

The following reports were linked to the September agenda:

 

Staff Senate Foundation account report.

 

Minutes of Employment Benefits Committee meeting of August  9, 2007.

 

NEW BUSINESS

 

Approval recommended nominee to Environmental Concerns Committee:  David Dagg was recommended to fill a vacancy on the ECC.  Debbie Copp moved for his approval.  The motion was seconded and passed on a voice vote. 

 

MISCELLANEOUS

 

Jannie Porter thanked the Executive Committee for their letter of response to the final report on healthcare.  She thought the group had expressed the sentiment that is being voiced across campus.

 

ADJOURNMENT

 

As there was no further business, the meeting adjourned at 3:35 p.m.

 

Respectfully submitted,

 

Barbara Perry

Administrative Coordinator

 

Shanika Bivines

Administrative Assistant