Learning About Health Benefits

The province-wide series of full-day education meetings the union held this fall included a detailed presentation on the design of BCNU's current health benefits plan.

"We believe that benefits education and consultation with members is especially important because health benefits help form nurses' total compensation under the provincial collective agreement," says BCNU President Christine Sorensen.

"Just like wages and pension benefits, health benefits are a vital part of nurses' overall compensation package. So it makes sense that nurses have a say in determining the future of their health benefits plan."

Sorensen says it's also important that nurses understand how health benefit costs are determined and paid. The education sessions were touted as the start of the consultation process on benefits that will help determine any recommended changes to the nurses' health benefits package.

Those who attended the education sessions also learned about the single most important benefit plan feature they enjoy – 100 percent employer-paid benefits – and how BCNU is committed to maintaining this for the health and well-being of all nurses. 

Members were also invited to provide input on their health benefits priorities and asked what they'd like to see improved (see sidebar).

WHAT DO WE MEAN BY BENEFIT COSTS?

The rising cost of extended health benefits has been raised as a serious issue by health employers for nearly a decade. However, many members may wonder why employers do not just buy health insurance from a benefit provider that's less expensive than Pacific Blue Cross. This question was the subject of much discussion during the regional education sessions.

When most people think of a benefits plan, they think of what is called an insured plan, where an employer purchases benefit plan insurance from an insurer, such as Pacific Blue Cross or Manulife.  When purchasing insurance, an employer is charged an informed estimate of what the benefits will cost, a charge for administration, and an additional amount (called a risk surcharge) in case of unexpected benefits costs.

If health employers were purchasing insurance for a nurses' health benefits plan, they might save money by finding another insurer that charges a lower risk surcharge. But health employers do not purchase insurance for nurses' health benefits.

Instead, health employers self-insure the health benefits plan, taking on all the risk of unexpected health benefits costs. Instead of purchasing extended health benefits insurance from the benefits provider, they contract Pacific Blue Cross only to administer, or provide, the benefits to the member. This means that employers pay Pacific Blue Cross only for the cost of the benefits used by plan members, plus a small amount for administration. As a self-insured benefit plan, expenses are largely limited to the costs of those benefits claimed by members, and nothing else.

This is an important distinction. It means that, with a well administered plan, the only savings that could be found by switching benefit providers would be in the small cost of administration. Conversely, if a self-insured plan were administered poorly, switching plan administrators could save a lot of money.

WHO PAYS?

As a self-insured plan, nurses' benefits are managed by a not-for-profit health benefits trust responsible for providing the benefits agreed to in the Nurses' Bargaining Association (NBA) collective agreement. Under this contract, the employer pays the bill for the benefits plan, no matter the cost. This arrangement protects nurses against escalating costs and safeguards the benefits offered. Regardless of the cost of the benefits plan, the employer can only make changes to nurses' benefits through collective bargaining.

Maintaining a 100 percent employer-paid benefits plan is a key achievement for the BCNU. All other health union members in BC are now forced to share the responsibility for funding their benefits plan through a Joint Benefits Trust (JBT) agreement. Under a JBT, funding for the benefits plan, including extended health, dental, and long-term disability (LTD) benefits is negotiated in advance and capped. If the benefits plan costs more than the negotiated amount, plan members and the employer share responsibility for financing the extra cost.

Under the 2019-2022 NBA provincial collective agreement, BCNU negotiated the opportunity for members to have a voice in the development of their future health benefits coverage while also securing 100 percent employer-paid funding.

Sorensen says it's a deal to be proud of. "BCNU remains committed to improving the value of nurses' benefits while protecting those members who rely on them the most." •