Capitol - Your Illinois News Radar » AFSCME: Rauner wants “two radical changes” to group insurance
SUBSCRIBE to Capitol Fax      Advertise Here      Mobile Version     Exclusive Subscriber Content     Updated Posts    Contact
To subscribe to Capitol Fax, click here.
AFSCME: Rauner wants “two radical changes” to group insurance

Friday, Jun 19, 2015

* This AFSCME Council 31 handout to members was scanned by a reader and then converted to text. I’ve tried to correct most of the conversion errors. The original document is here

Drastically reducing the group insurance benefit for state employees has been a priority for Governor Rauner since Day 1. Even before contract negotiations got underway, the Governor made cutting the state’s insurance plan a pillar of his budget proposal building $700 million in cuts to the group health plan into his budget. Even though his staff admitted in legislative testimony that changes would have to be negotiated with state employee unions, the governor is now demanding that legislators amend the collective bargaining law to ban negotiations over health care benefits.

At the bargaining table, Rauner is pushing for two radical changes to the group insurance benefit which could increase employee costs by thousands of dollars each year: He is proposing to drastically increase the share of the premium paid by employees and drastically increase the out of pocket costs when employees access healthcare.

Rauner wants to double the employee premium contribution to 40% of the cost for single coverage - and to 40% of the cost for dependent coverage too. By federal law, the cost for single coverage is capped at 9.5% of income. However, there is no cap at all on the premium contribution for dependent coverage. This proposal represents a significant change in a number of ways:

1. Currently employees pay a fixed dollar amount toward premiums that is specified in the contract. Moving to paying a percentage of the premium cost means that employee costs would rise each year based on any increase in the state’s healthcare costs.

2. Currently employees who make less pay a little less for health insurance, and employees that make more pay a little more. This proposal eliminates protections for lower paid workers, as everyone will be paying the same amount for group insurance.

3. Increasing the employee premium contribution from 19% (the current average contribution) to 40% puts Illinois outside the norm of other states. The national average for state employee premium contributions is 16%.

Rauner also wants to lower the insurance plan’s value and institute massive cost shifting onto employees through high out of pocket costs. The Administration is proposing a health plan with a 60% actuarial value. This means that on average, the health plan will pay 60% of allowable health care expenses, with the employee paying 40% of the cost through deductibles, copays and co-insurance.

• The current actuarial value of the Illinois group health plan is 93%. This mirrors state employee group insurance plans in other states. The average state government health plan nationwide had an actuarial value of 92% in 2013; the Midwest average is 93%.

• The Administration’s proposal does not include any specific changes to co-pays, deductibles, etc. Rather, it would delegate a committee to develop the new out of pocket costs based on its demand that employees pay a total of 40% of health care expenditures.

These proposed changes to health benefits would move Illinois from average to dead last when compared to other states.

• The Affordable Care Act (ACA) ranks plans as: platinum (best); gold; silver; bronze (worst). 60% actuarial value equates to “bronze” level coverage under the ACA.

• The average bronze level plan for an individual has a deductible of $5,400 and an out-of­ pocket maximum of $6,350. Bronze level plans would result in staggering and unaffordable cost increases for state employees. These plans have out of pocket costs at or near what is allowable under the ACA:

    o $6,600 for single
    o $13,200 for family

• 96% of states have a group health benefit that equates to an ACA “platinum” plan (valued over 80%).

• Only two states have “gold” level plans (valued at 80%)

• No other state has an employee health insurance plan with an actuarial value as low as 60%

- Posted by Rich Miller        

  1. - Andy S. - Friday, Jun 19, 15 @ 3:56 pm:

    I am at a loss for words to describe this proposal, because they are all banned on this site.

  2. - Liberty - Friday, Jun 19, 15 @ 4:00 pm:

    This is exactly why I voted for a Democrat for the first time.

  3. - Oswego Willy - Friday, Jun 19, 15 @ 4:03 pm:

    Rauner won, now he wants what he wants.

  4. - Demoralized - Friday, Jun 19, 15 @ 4:04 pm:

    Who could afford this? You may as well not have health insurance at all.

  5. - Anonymous - Friday, Jun 19, 15 @ 4:04 pm:

    How would this new proposed plan compare to health insurance plans and contributions typically offered by a private employer?

  6. - Joe cannon - Friday, Jun 19, 15 @ 4:04 pm:

    What a great way to driv out tier 1 employees to permit the hiring of pension relieving tier 2 ones. Or privitizing to nonunion NFPs

  7. - Peoria Guy - Friday, Jun 19, 15 @ 4:05 pm:

    Lord knows we need radical changes if this state is to recover from the mess we are in. I understand nobody wants those changes to touch them. There are no easy answers

  8. - Norseman - Friday, Jun 19, 15 @ 4:05 pm:

    Happy, Father’s Day weekend news. Not really surprised. Rooting for AFSCME to stay firm.

  9. - Politix - Friday, Jun 19, 15 @ 4:05 pm:

    Wonder what the actual cost savings to the state is projected. Is it significant or is this another way to stick it to unions?

    Most expect insurance premiums to increase, but a jump from 19% to 40% is alarming.

  10. - Casual Observer - Friday, Jun 19, 15 @ 4:06 pm:

    And in return he’s offering…? I thought so.

  11. - union employee - Friday, Jun 19, 15 @ 4:07 pm:

    I hope unions will not allow this to happen.

  12. - Cassandra - Friday, Jun 19, 15 @ 4:08 pm:

    Aren’t employee health costs going up in the private employment sector as well (I’m leaving out the freelancers and contract workers, not sure how they are faring, maybe better than before when many if not most couldn’t even get insurance).

    Shouldn’t that be the comparison, not just other government workers. Or is the argument that government workers should be treated differently with respect to health insurance costs. If so, why?

    Anyway, want to solve all this? Single payer for the nation. Put everybody on Medicare. Other developed nations have done it.It’s probably coming here too, but maybe not for a few more decades.

  13. - 1776 - Friday, Jun 19, 15 @ 4:08 pm:

    So the unions think it’s OK to be “average” in the cost for insurance premiums for workers but it’s not OK for employers to be “average” in Work Comp premiums?

  14. - bloval27 - Friday, Jun 19, 15 @ 4:08 pm:

    Wait so is for the State workers this proposal? Or does this also include those who work for AFSCME directly or both? Just curious to know the dynamic of all this.

  15. - Skeptic - Friday, Jun 19, 15 @ 4:09 pm:

    Peoria Guy: If AFSCME employees were the cause of this mess, I might agree with you.

  16. - anon - Friday, Jun 19, 15 @ 4:09 pm:

    The proposed cost shift is unconscionable and clearly unaffordable for the majority of State workers with families. Another example of Mr. Rauner attempting to provoke a strike if impasse is declared.

  17. - Secret Square - Friday, Jun 19, 15 @ 4:11 pm:

    “How would this new proposed plan compare to health insurance plans and contributions typically offered by a private employer?”

    Also, how do these drastic changes compare to those typically made by a private employer when costs go up? Do they ever try to make changes that could or should have been made over several years, or even decades, all at once?

  18. - Demoralized - Friday, Jun 19, 15 @ 4:11 pm:

    The state has given notice that they do not intend to extend the current contract. I would bet anything that come July you’ll start seeing Executive Orders issued to begin to implement things the Governor wants to include in the contract, including this healthcare proposal. AFSCME is going to spend a lot of time and money in court in the near future. Mark my words.

  19. - Politix - Friday, Jun 19, 15 @ 4:12 pm:

    “What a great way to driv out tier 1 employees to permit the hiring of pension relieving tier 2 ones. Or privitizing to nonunion NFPs”

    Ask any Tier 1 with more than 10-15 years in if they are planning to quit. Rauner would like nothing more. Forget it.

  20. - Politix - Friday, Jun 19, 15 @ 4:13 pm:

    “The state has given notice that they do not intend to extend the current contract.”

    They have? I must have missed something.

  21. - Secret Square - Friday, Jun 19, 15 @ 4:14 pm:

    “Wait so is for the State workers this proposal? Or does this also include those who work for AFSCME directly or both?”

    I take it you mean, “Does this proposal affect all state workers or only those who belong to AFSCME?”

    The answer is yes, it affects ALL state workers, union or not — whatever health insurance deal is worked out in the AFSCME contract is applied to everyone. (Unlike the wage provisions, which only apply to those in the respective bargaining units.)

  22. - Anotherretiree - Friday, Jun 19, 15 @ 4:16 pm:

    Still no hint if this affects non Medicare retirees. I suspect it does. If you have medical issues, I suggest you address them now. Unless you want Gov Rauner doing your colonoscopy.

  23. - jimk849 - Friday, Jun 19, 15 @ 4:18 pm:

    This shows how willing Rauner is to negotiate.

  24. - bloval27 - Friday, Jun 19, 15 @ 4:19 pm:

    Ah ok, thanks Secret Square that clears it up.

  25. - Joe cannon - Friday, Jun 19, 15 @ 4:19 pm:

    @politix while being snarky my point remains. Anyone who can retire, with no changes to insurance ( kanerva) will have a huge financial incentive to do so. And yes Rauner would be happy

  26. - Anonymous - Friday, Jun 19, 15 @ 4:22 pm:

    ==Also, how do these drastic changes compare to those typically made by a private employer when costs go up?==

    Yes. The year Obamacare took effect many private employers had to raise employee costs significantly (and employer costs also rose significantly)…or they had to drop coverage completely because it was no longer affordable.

  27. - Georg Sande - Friday, Jun 19, 15 @ 4:22 pm:

    You know, the folks in this space are resoundingly left and often times state government employees. And that’s okay. But most people in the real world — and in the real Illinois — are neither. So maybe, just maybe, some balanced info. would help before reconstituting the “Governor is a Big Meanie” meme.

    We don’t know if previous years’ health costs were subsidized or worse, super-subsidized, by taxpayers. Let’s face it, neither Blago nor Quinn were really negotiating all that much with AFSCME.

    So let’s find out BOTH sides before more Leftist nonsense is dispensed, shall we?

  28. - Liberty - Friday, Jun 19, 15 @ 4:22 pm:

    These costs are dramatically higher than average (not large employer) in the private sector according to the Kaiser Foundation

  29. - Demoralized - Friday, Jun 19, 15 @ 4:25 pm:


    You forgot to use the word socialist in your analysis. Do better next time.

  30. - john - Friday, Jun 19, 15 @ 4:28 pm:

    For those of you mentioning private sector employers; one of the reasons that large public sector employers are compared to each other and not to the private sector is the sheer size of their workforce and retirees covered under the plan. The number of people covered by the plan and the single payor - the State; enables the state to negotiate deep discounts in their plan that most smaller private sector companies could never achieve.

    In Illinois, if you include all state and university employees and retirees we are over 100,000 people. Almost no private employers have that large a workforce inside the United States anymore. Illinois is also a contained healthcare marketplace with just a few markets - another way for the employer to negotiate discounts.

    No private employers are able to offer insurance companies the insured network size and limited area of coverage as large state and local government employers. That is why you compare large public sector employers to each other and not to the private sector.

  31. - ACA insider - Friday, Jun 19, 15 @ 5:03 pm:

    As someone who spent the last 2 years signing people up for Obamacare, and knows the ins and outs, bonuses and mistakes of the law, this gives me the shudders. The ACA was a huge step up for so many people who have been categorically denied health coverage. But it is also mostly unaffordable for low-income workers. And the worst, absolute worst mis-step in the law seems to be incorporated here in Rauners’ demands; unlike the 9.5% affordability provision for employer coverage for the employee themself, there is no provision for what is considered ‘unaffordable’ for dependent coverage. As a result, tons of working people are forced to take their employer insurance for themselves - which might come in *just* under 9.5% of their income - but their spouse’s or kids’ coverage can be 15-20-40% of their income with no exemptions, no subsidies…ultimately no coverage for them. Add insult to injury - then the system assigns them a penalty in their taxes! (which they may be able to waive, *if* you are someone who knows the fine print…) This proposal is in no way sustainable…people will become uninsured. Rauner would be forcing state employees into a high deductible health plan that will ultimately squash them with debt when they get sick.

  32. - Mason born - Monday, Jun 22, 15 @ 8:57 am:

    I posted my last comment right before rich closed comments. My last line should read. Not that I agree with it it’s a terrible idea.

  33. - Cynic - Monday, Jun 22, 15 @ 5:02 pm:

    So this seems to fly in the face of the state Supreme Court’s ruling in Kanerva vs. Weems, a case heard July 2014, that tested whether State employee/retiree health care benefits can be reduced. The justices ruled that the state constitution’s pension protection clause is “aimed at protecting the right to receive the promised retirement benefits, not the adequacy of the funding to pay for them.” So how is raising the premiums and deductables to an unaffordable level count as not diminishing promised benefits? Or is this only aimed at current workers leaving the annuitants unaffected? If so get ready for massive retirements.

Sorry, comments for this post are now closed.

* Question of the day
* What would a day be without yet another Illinois State Fair #facepalm?
* Today's quotable
* County commissioner says Rauner camp threatened him with a smear campaign
* Rate Rauner's new online ad
* SUBSCRIBERS ONLY - Today's edition of Capitol Fax (use all CAPS in password)
* *** UPDATED x1 *** Joe Biden cancels State Fair event
* Yesterday's stories

Visit our advertisers...






* Amputee cricketer is back playing the game he l.....
* Rauner makes changes to bill on Medicaid eligib.....
* Letter: Speaker Madigan is an effective .....
* Rauner vows to make Illinois the top state for .....
* Rauner hopes Madigan's a crook, but .....
* Erika Harold attacks Kwame Raoul with first TV .....
* Rauner signs legislation aimed at keeping at-ri.....
* Politically connected former employees sue to g.....
* New state law gives priority to minority and wo.....
* Planned Parenthood Speaker Talks Election Day a.....

* Governor’s Day at state fair puts focus on November election
* Chicago officer sues over placement on desk duty since 2009
* Illinois manufacturer to lay off 150 workers, move to Mexico
* APNewsBreak: US, Mexico to announce new plans on cartels
* Activists say planned reform of Chicago police falls short
* Emanuel opens new food hall at Chicago’s Midway Airport
* Rauners kick in $1 million to restore fairgrounds’ Coliseum
* Bond decrease denied for men accused of luring boy from home
* Trump Tower operators sued over water release into river
* Defense: No evidence in teen’s death days after Obama event

* Joe Biden ill, cancels trip to Springfield
* Rauner makes changes to bill on Medicaid eligibility backlog
* Rauners announce $1 million donation for Coliseum work
* Rauner again calls Pritzker, Madigan corrupt
* Veterans, Gold Star Families honored at Illinois State Fair
* Legislation to streamline Medicaid approvals too late for Girard nursing home
* Illinois inspectors climb over, under state fair rides for safety
* Rauner says AG should prosecute Madigan
* New dual-credit course law helps teens lower college costs
* Bill signed to prevent state payouts for sex harassment

* DuPage pushes fight for O'Hare western terminal
* United sheds punching-bag status with biggest U.S. airline rally
* Northern Trust looks to get into crypto custody
* Redbox gears up for its first major ad campaign
* Whither the Kraft Heinz ketchup packet?

* ‘Possible engine problem’ forces Chicago-bound flight to land in Charlotte
* Illinois manufacturer to lay off 150 workers, move to Mexico
* The place of Mitch Sroka in Chicago fishing: Some memories and context
* Governor’s Day at state fair puts focus on November election
* Still-achy Cubs closer Brandon Morrow expects to throw from mound this weekend
* Check that. White House says it was wrong on black employment
* Twitter puts conspiracy theorist Alex Jones in time out
* India will send manned flight into space by 2022: prime minister
* Manafort jury to hear closing arguments in fraud trial
* 3 shot, 1 fatally, in city shootings Tuesday

* A deranged gunman shot up a West Side school 30 years ago, killing a female Chicago cop. Now officials want to name a city park for her.
* Ryan LaMarre's 1st MLB home run caught by his uncle: 'You couldn't dream it up'
* 2 women hit by bullets fired into homes in Chicago: One killed, the other seriously wounded
* Former Vice President Joe Biden cancels Illinois trip because of illness, won't attend Democrats' big state fair event
* Primary night: Democrats go for diversity, Republicans for Trump choices
* It looks like the Bears chose money over Roquan Smith’s immediate development
* The facts behind 'fat-burning' foods and other nutritional trickery
* 'He's a priest. I trusted him': One of the 1,000 victims of alleged Pennsylvania clergy abuse tells his story
* Palka-dancing? Daniel Palka turns his base-running gaffe into a bonus for the White Sox

» Aug. 14, 2018 - Full Show
» A Midway Airport Restaurant Company Is Attracting Interest From The Feds
» Consent Decree Could Boost Mental Health Resources In CPD
» Chicago Charter Schools Risk Budget Cuts Without A Fix In Springfield
» For Illinois Birds, Moving To Urban Areas Key To Survival
» Kindergarten Readiness; Anti-Harassment, Equality and Access Panel; Solar in Southern Illinois
» Aug. 13, 2018 - Full Show
» Rauner Continues To Blame Madigan For 'Illegal Activity'
» Mental Health Treatment For Children, Workaround Podcast; Forgotten Desserts
» When Giving Up Custody Is The Only Way To Get Affordable Health Care; Forgotten Desserts

* Joe Biden ill, cancels trip to Springfield
* Rauner makes changes to bill on Medicaid eligibility backlog
* Guest View: Remember when Rauner wanted to eliminate DCFS scholarships?
* Marc Thiessen: Trump's failure to reject the bigots of the alt-right tars his presidency
* Illinois lawmakers should emulate Rep. Gordon-Booth’s expungement summits
* Byron York: With Mueller, like Kenneth Starr, beware wishful thinking
* Rauners announce $1 million donation for Coliseum work
* E.J. Dionne: Don't let politics dumb you down
* Senator Durbin: I’m waiting for answers from Brett Kavanaugh
* Rauner again calls Pritzker, Madigan corrupt

* Scattered thunderstorms expected across Central Illinois today
* Pesotum man killed in Interstate 74 crash
* Williamson County commissioner says GOP applied heavy pressure to get gun measure on ballot
* New pantry addresses 'food insecurity' among B-N college students
* Decatur and Macon County neighbors: Obituaries published today
* WATCH: Candlelight vigil for Decatur stabbing victim Cody Drew
* $51,000 base salary: Norfolk Southern struggling to hire 30 train conductors in Decatur
* Daily Digest: Property taxes due Sept. 4
* Rick's Six: Cool Q-C, prep football previews coming, and sweet corn ice cream?
* 'Genuine need': Distribution ministry fills gaps for people in need

* George Conway, husband of Kellyanne, tweets on Trump's 'false and misleading' statements
* Prosecutors: Man was drunk, going 83 mph when he caused double-fatal crash
* Will Bears rookie Roquan Smith have an impact Week 1? Nagy doesn't know right now.
* Governor signs bill requiring public notice of tollway contracts
* Long Grove postpones hiring company to demolish bridge cover

* Hultgren hosts town hall meeting in McHenr...
* 'Are you better off now?' Hultgren...
* Mattis OKs Returning War Trophy 'Balan...
* Hultgren Holds Town Hall Meeting in Yorkvi...
* Despite Ohio results, pundits say Dem win ...
* 6th Congressional District candidate Caste...
* Naperville Now 08-14-18
* America's Central Port awarded EDA gra...
* Pelosi takes on the roaring economy, and T...
* SIU Carbondale awarded 2 federal grants fo...

* Is Federal Digital Sales Tax Legislation o......
* Durbin, Frerichs stumped for Pritzker, Kel......
* A detention center company is donating a l......
* Sen. Durbin announces plans to challenge d......
* Here are 10 times President Trump's co......

* Sen. Harris, Colleagues Call on DHS Sec Ni......
* 'Disability Rights Are Civil Rights......
* Who backs who in Florida governor race?...
* Yes, Bob Casey is boring. In 2018, that......
* Heating up in the Windy City: The Tipline ......

* Like Alex Jones or not, Left-immersed Social Media is out to purge "disagreeable" voices
* Revision of Obama-era Fuel Economy Rules Is No Climate Disaster
* Block Club Chi: Railroad Police Regret Using Bait Trucks In Chicago, Promise Not To Do It Again
* Clarion Call to Church Leaders as November mid-year election draw near
* Why Democratic Socialists Can’t Legitimately Claim Sweden, Denmark as Success Stories
* A psychedelic migraine on the gig poster of the week
* Welfare states cultivate the sin of sloth
* Democratic Socialism Threatens Minorities
* Democrats More Positive About Socialism Than Capitalism
* Japan: America’s Neglected Ally?

* Governor announces $1 million Rauner family contribution to begin restoration of Coliseum; takes action on package of agriculture legislation
* Governor signs tollway transparency bill
* 2018 Adams County Tentative Multiplier Announced
* Gov. Rauner signs legislation aimed at keeping at-risk families together
* IDOA, Illinois Bicentennial to Host Inaugural Prairie Heritage Ride

* Fertility app blamed for 37 unwanted pregnancies is now FDA approved in the USA
* IDC: Xiaomi lead Samsung by a margin in the India market during Q2
* [TA Deals] Grab a cheap lifetime subscription to Sticky Password over 70% off!
* Don’t be fooled by NYC’s new ‘Apple’ pop-up shop
* Learn how to master Raspberry Pi 3 for under $20
* Bots didn’t flop; they just became invisible
* Madden NFL Overdrive is the new Madden EA mobile game (Updated: Out now!)

* Casting fate: White Sox overcome Detroit, 6-3
* Six Pack of Stats: White Sox 6, Tigers 3
* Six Pack of Stats: White Sox 6, Tigers 3
* White Sox Minor League Update: August 14, 2018
* White Sox Minor League Update: August 14, 2018
* Giolito keeps composure in White Sox win
* Big Klu in '59 White Sox best August trade

Main Menu
Pundit rankings
Subscriber Content
Blagojevich Trial
Updated Posts

August 2018
July 2018
June 2018
May 2018
April 2018
March 2018
February 2018
January 2018
December 2017
November 2017
October 2017
September 2017
August 2017
July 2017
June 2017
May 2017
April 2017
March 2017
February 2017
January 2017
December 2016
November 2016
October 2016
September 2016
August 2016
July 2016
June 2016
May 2016
April 2016
March 2016
February 2016
January 2016
December 2015
November 2015
October 2015
September 2015
August 2015
July 2015
June 2015
May 2015
April 2015
March 2015
February 2015
January 2015
December 2014
November 2014
October 2014
September 2014
August 2014
July 2014
June 2014
May 2014
April 2014
March 2014
February 2014
January 2014
December 2013
November 2013
October 2013
September 2013
August 2013
July 2013
June 2013
May 2013
April 2013
March 2013
February 2013
January 2013
December 2012
November 2012
October 2012
September 2012
August 2012
July 2012
June 2012
May 2012
April 2012
March 2012
February 2012
January 2012
December 2011
November 2011
October 2011
September 2011
August 2011
July 2011
June 2011
May 2011
April 2011
March 2011
February 2011
January 2011
December 2010
November 2010
October 2010
September 2010
August 2010
July 2010
June 2010
May 2010
April 2010
March 2010
February 2010
January 2010
December 2009
November 2009
October 2009
September 2009
August 2009
July 2009
June 2009
May 2009
April 2009
March 2009
February 2009
January 2009
December 2008
November 2008
October 2008
September 2008
August 2008
July 2008
June 2008
May 2008
April 2008
March 2008
February 2008
January 2008
December 2007
November 2007
October 2007
September 2007
August 2007
July 2007
June 2007
May 2007
April 2007
March 2007
February 2007
January 2007
December 2006
November 2006
October 2006
September 2006
August 2006
July 2006
June 2006
May 2006
April 2006
March 2006
February 2006
January 2006
December 2005
April 2005
March 2005
February 2005
January 2005
December 2004
November 2004
October 2004

Blog*Spot Archives
November 2005
October 2005
September 2005
August 2005
July 2005
June 2005
May 2005


RSS Feed 2.0
Comments RSS 2.0

Hosted by MCS SUBSCRIBE to Capitol Fax Advertise Here Mobile Version Contact Rich Miller