Health Care and Stagnant Wages

[louis c]

I am the President and Business Agent for a small local that represents about three hundred employees at a race track. The positions are diverse and the pay ranges from about $22,000 a year to about $40,000 a year.

Here's my point. In negotiating with management that has a very low profit margin, we are attempting to agree on wages and benefits. The employer pays 50% of health insurance costs, the employee the other 50%. Currently, the family plan is about $120 a week (employee deduction). That means the employer pays the other $120.

If I negotiate a 4% pay hike for this year (although it is a three year contract, let's just take the first year for my example), that amounts to about $24 a week, on average.

If health care premiums increase by the projected 20%, the employee and employer each incur a $24 a week increase. Here's my dilemma. Management is giving my members a $48 wage increase per week, but my members know that a $24 increase in health insurance deduction offsets any wage increase, resulting in the impression that the union got them nothing.

As more and more situations like this take place, the workers can afford health insurance less and less. If this country is going to rely on an employer based health care system, the federal government must take action by giving corporations tax breaks and incentives targeted to offset the employees premiums. This will encourage companies to increase their share of the health premiums. The result will be more affordable health care, and more participation. If nothing is done, this system will go from a disaster to a catastrophe.

[redqueen]

1. Universal, Single-Payer Healthcare is the ONLY way to go

keeping insurance in the picture just funnels money to profits instead of patient care.

[Hoping4Change]

2. "Funnel money into patient care, not profits" should be a

campaign slogan.

[redqueen]

5. Yeah it should

too bad nobody is running on that issue (UHC). If Kerry were to support it instead of tweaking the house of cards we have now, I would hope that it would be helpful in his campaign.

:(

[Feanorcurufinwe]

15. I want health care, not health insurance.

I completely agree that an effort to get more people insured is misguided. What we need instead is an effort to more effectively deliver health care to people.

[dorktv]

21. I am running on a single payer system as my main issue!

A single payer system is not free but at least we ALL get health care.

[JanMichael]

3. It's an impossible dilemma. HC has a 14% inflation rate, 2003 wages...

...went up 2% and rarely top 5%.

This is a temporary solution to a permenant problem.

Single Payer is the only real solution for the workers that you're responsible for, for the Workers that we're all resposible for.

[JanMichael]

4. This is a real problem.

:kick:

[Deja Q]

6. We need to correct the problem, not masturbate the symptoms...

The problem is not having price controls, greedy insurance salesmen, and idiot 'practitioners' who are a big part as to why people sue 'em. Yes, there are customers who abuse the system. But making everybody pay 18% more per year is absofuckinglutely CRIMINAL.

The symptom is forcing people to pay more and more for what amounts to C+ level healthcare, in a media that purports it to be A++++ level. This in turn damages the economy on both corporate and workers' sides.

It's a downward spiral.

And the traitors in power see no need to change a frigging thing. They don't need to bother, they get great healthcare AT TAXPAYER EXPENSE. That's part of the problem too, our elected officials are arrogant fuckers who do things for themselves and screw us in the process.

[JanMichael]

7. I guess real dilemmas aren't as interesting as I thought...

:shrug:

[Wapsie B]

8. This is crazy.

NO ONE in this country should have to go uninsured. I keep hearing from repug doctors around here that we need to start rationing healthcare in this country to keep costs down. Excuse me but isn't that the slam the righties use to stop discussion about the Canadian or European systems?

[leftofthedial]

9. remember what the repukes and the insurance industry did to

the Clintons when they tackled healthcare.

How can we resolve the problem?

The sheeple fall for the "socialism" bullshit and shout down every sane solution that is suggested.

[redqueen]

24. It can't happen without cooperation by the media

We need to talk to our friends and neighbors more about this issue. Make sure they understand that -- despite the boogeyman scare tactics of the hyperventilating right -- a universal, single-payer system is the only way to end the skyrocketing costs we're seeing now.

Also, the media blitz will not work this time like it did before. There is growing demand for a sane healthcare system, and it seems people are starting to realize that losing the money that private insurance is using for profits (revenues, bonuses, excessive exec compensation, etc.) is a significant part of the problem.

[whistle]

10. Is the race track (I am assuming that's as in horses not gas stations)...

...management showing you the audited financial for last year and projections for the coming year? By my calculations 300 employees with an average $48 increase in HC insurance ($24 + $24) means $750,000 more in premiums. That's against a total payroll of $9,000,000. So the company health-care runs $3,750,000 (20% against the premium increase). Sounds like cooked books to me. Make sure you get valid financial before the negotiations move any further.

Where I work, premiums went up 20% while benefits dropped through higher co-pays and less coverage. I'm still covered, but I pay $35 now per office visit (up $10), several medications I take are not on the new company's formulary so the HMO does not have to cover them. I take what the HMO covers or pay the full amount for these branded prescriptions. This could cost me up to $150 per month more in prescriptions. This is becoming a financially devastating issue with wage earners. Something needs to be done.

[louis c]

11. As a state regulated Horse Track

all the records are public. Our labor lawyer goes through them for any discrepancies, and has audited the health premium issue. The choice of a provider is vetted through an independent, third party. My members are high risk, because Mutuel Clerks (selling the pari-mutuel tickets) make up half the members and can work productively into their 70's, and we have very strict seniority rules. We are always threatened with selling the lucrative property less than a mile from Logan Airport. There was an article just today in the Boston Herald business section on that subject. I have been lobbying very hard for three years to bring slots to my track, as they have in many others. If this comes to fruition, the health care contribution will go to 75% by management, and retirement benefits will increase substantially. Without them, we will slowly deteriorate as a viable entity. Thank you for your interest and concern.

[disinfo_guy]

12. Retitle to "Am I the only liberal that supports screwing over workers?"

to get more responses :)

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=104x1831239

[louis c]

16. I break my ass for my members

and I have to live with reality. There will not be universal health coverage by the end of the year. So,I don't know what you mean.

[disinfo_guy]

19. I was trying to be funny, obviously I wasn't. sorry

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=104x1831239

We were asking why this thread didnt' get more responses:

...
Try calling it: "DLC helps Rich Bastards steal Health Insurance" It's all in the presentation.
...
Just post the following: Hey am I the only liberal who opposes (include major liberal shibboleth here) alternately try: Hey am I the only liberal who supports (include any plank of the Republican party platform that's shown up in at least four of the last five elections) voila! Insant controversy
...
To get attention at DU you need to cause a conflict. Try baiting the neo-liberal anti-union types into one of their "unions are no longer necessary" lines, then you'll get the union Democrats to respond. Sprinkle liberally with some red meat class warfare rhetoric (this goes over well at DU since so many upper middle class management types read it). Perhaps throw a Jesus was a socialist angle, which will get the athiests posting. Always throw in a stab at Bush and the GOP.

[louis c]

25. I understand

sometimes I get to sensitive, or cranky. No offense taken. Let's just beat that F'n asshole in the White House and the pieces of shit in his administration.

[dumpster_baby]

13. "tax funded" universal healthcare gives an extra 2 years of life!

Our elected representatives have a duty of care to provide for the general welfare, as stated in the Constitution. Obviouisly, those countries such as Canada, Sweden, France, Denmark have provided better for their citizens than have the American politicans. The American politicans have provided for the investors, but not for Americans. And we have paid the price for our politicians selling us out-- we AMericans live an average 2 years less than citizens of those countries such as Canada, Sweden, et al, who have tax funded universal healthcare.

But will our politicians for this murderous negligence? Of course not!

But I propose that we DO make them pay--they should be tried for manslaughter of the thousands, nay, the millions of Americans who have lived shortened lives because our "leaders" have sold us out for corporate profits. And if they are found guilty, they should be executed. I am NOT talking about breaking the law here, but an electoral revolution making our leaders pay for the rapacious pillaging of the American trust. Vote in elected representatives who will make them pay!

[tom_paine]

14. kick

:kick:

[Cleita]

17. Kerry should offer businesses and unions like yours an

improved Medicare plan extending it to those who want to purchase the coverage. They could do it for much less than any private insurance or HMO with more coverage. You should lobby for it. The only way this will happen is if people like you put the pressure on. Medicare already has a bureacracy in place that works quite efficiently and only used 2% of the money collected on administrative costs. Properly funded, extending Medicare to the whole population would be the answer to many of our problems. The private health care insurers can't complain. They say competition brings down prices, so let them compete.

[BigMcLargehuge]

18. that's happened every year for five years at my current company

for the first two years we received between 5 and 8% increases/bonuses. Health premiums went up 30% negating the raise/bonus and lowering take home pay. Each of the last 3 years has shows a 40% increase, or more, in our health care premiums.

I not take home less after 5 years than I did the year I was hired.

[louis c]

22. That's my problem

Unions, in negotiations, can't make wages move ahead of skyrocketing health ins. premiums. Not only does it create an enormous problem for the employees and the Unions that represent them, but it is a phenomenal problem for even a company that wants to be fair.

[BigMcLargehuge]

29. and we aren't a union shop, which pisses me off to no end

so we are doubly screwed. We have no contractual protection from year to year.

And after three years of pay reductions and HC premium increases all of us are suffering.

[IrateCitizen]

20. Sounds like you're stuck between a rock and the system, louis_c

First, I would like to thank you for the work you're doing for a union workforce. Although I do not currently work in a unionized industry (I'm an engineer), both of my parents were unionized public schoolteachers, along with my wife, and my grandfather was a union steelworker. So, I certainly appreciate the value of unions.

You described the problem, in a nutshell, by citing the 20% rise in health insurance, annually. The real betrayal here is that health care is not increasing anywhere close to that number, just health insurance.

I can appreciate your proponency for corporate tax rebates for health care, especially being on the front lines of this issue, but in the end it's little more than a triage treatment. Assuming that health insurance premiums keep increasing at a double-digit rate each year, those tax abatements would lose their value and effectiveness pretty quickly, and you and your union workers would be back right where you started.

One thing I've wondered regarding unions is if the idea of forming health insurance cooperatives within the union or as a project of several unions has ever been tossed about. I mean, if the for-profit insurance companies are screwing everybody over, why don't organizations on the scale of some of the larger unions form their own health insurance plans that operate in a similar manner to union pension plans? This way, the constant increases in health insurance premiums would be kept under control, because they would be directly tied to health care costs rather than meeting quarterly profit goals. Furthermore, as such an idea spread, private health care companies would be forced to lower their premiums in order to have hope of competing against cooperative set-ups.

Short of that kind of a solution, I only see price controls and regulation of the health insurance industry by the government as a solution to stopping this runaway train. Of course, single-payer health care would eliminate all those problems, but unfortunately I don't see that as a short-term reality here in the United States.

[louis c]

23. I'm open to any suggestion

and I appreciate any input, but my problem is immediate, and my members, at meetings will understand our dilemma. the issue here is sometimes this Administration, and their friends in congress create these problems for organized labor. I only wonder if it is accidental or deliberate.

[IrateCitizen]

27. WRT organized labor, it's all quite deliberate

Even the big business-friendly Democratic Leadership Council has openly proclaimed that the Democratic Party should move away from the working class, and instead concentrate on "young professionals" in order to win elections.

The problem is that you're touching on some much deeper socio-economic issues than simply health care by stating such a question. In an economy that no longer produces a majority of the world's consumer goods, but instead is dependent upon obscene consumer spending and speculative finance capital, unions are perceived as an obstacle to the maximization of next quarter's profits, rather than a necessary key toward the creation/continuation of a more egalitarian and just society. That's why politicians from BOTH political parties have moved, over the years, to support obstacles to union organizing as well as policies that back big business over workers, whether they be union or non-union.

I understand that your problem is short-term, and that's why you support tax abatements. If I were in your situation, that's where I would be looking too. But I'm just trying to stress the point that there needs to be a long-term strategy of how to get past these double-digit increases in health insurance, and focusing on tax abatements isn't going to do it.

[louis c]

36. I understand

that in manufacturing, they have their own set of problems that make mine pale by comparison. Every one of my members works in either the service or maintenance part of our industry. As a gaming institution, we're strictly service, and produce nothing. we don't export, and can't be exported. At least I can't imagine it, but who knows.

[louis c]

37. *

[thecrow]

26. A view from Canada..

Silver Donald Cameron is a writer from Cape Breton (Nova Scotia).
He wrote about this recently... here's what he had to say: (excuse the length but I don't have a direct link without having you join the discussion group)
SUNDAY HERALD COLUMN — June 9, 2004 (HH0414)

THE POWER OF MEDICARE
by
Silver Donald Cameron
If there’s one thing that’s clear about politics in this country, it is
that Canadians cherish medicare. Medicare defines us; it is how we care for
one another. And, as an article published this past week in the Canadian
Medical Association Journal makes clear, Canadians are dead right to
cherish their system.

The article analyzed the cost of care at privately-owned,
profit-making hospitals compared with non-profit ones. The study team was
headed by Dr. P.J. Devereaux of the McMaster University medical school.
Costs at investor-owned hospitals in the US, they found, are higher by a
whopping 19% than in non-profit institutions.

“The reality is that for-profits face significant economic challenges,” Dr.
Devereaux told Reuters. “The first is that they have to generate revenues
that will satisfy shareholders. Second, they have high executive bonuses.
Thirdly, they are very top-heavy and have high administrative costs. Also,
they have to pay taxes.

“That is a lot of extra money that they have to come up with,” says Dr.
Devereaux. And so investor-owned hospitals “were cutting corners in quality
health care, and also people were having to pay more for care.”

Free-market dogmatists argue that competition will ensure the best possible
product at the lowest possible price. In other fields, that’s true — but
in health care, it’s a fallacy. First, many hospitals have no real
competition; my local hospital is the only one for 80 kilometres in any
direction. Second, hospital patients are not model consumers, shopping
around for the best price and the highest quality, and refusing to buy if
the cost is too high. They are usually frail, elderly and/or desperately
ill. They take what they can get, and pay what they must.

From a business viewpoint, one could hardly ask for a more glorious
opportunity than this: a desperate customer, an essential service that’s
difficult to evaluate, and a lack of competition. And if the costs are
being paid by government — which rarely quibbles about a bill, and never
goes bankrupt — that’s even better.

But not for patients or taxpayers. Commenting on the Devereaux study (which
they describe as “meticulous”), Harvard professors Steffie Woolhandler and
David Himmelstein note that for-profit hospitals “are profit maximizers,
not cost minimizers” and that “strategies that bolster profitability often
worsen efficiency and drive up costs.”

Such strategies, say the Harvard duo, often cross the boundary into
outright fraud. Columbia/HCA, the largest US hospital firm, “has paid the
US government $US1.7 billion” in fraud settlements, and Tenet, the
second-largest, has paid settlements of over half a billion dollars. The
frauds included kickbacks to physicians, over-billing, and such antics as
“performing cardiac procedures on healthy patients.”

These frauds are not occasional excesses; they reveal a pattern of
criminality and greed. The CEO of Columbia/HCA resigned in the face of
fraud allegations — picking up $10 million in severance and $324 million in
stock as he left. The departing CEO of Tenet exercised $111 million in
stock options. The head of HealthSouth, another giant health firm, was paid
$112 million in 2002, and indicted for fraud the following year.

Furthermore, say Woolhandler and Himmelstein, in non-profit or
government-owned institutions the CEO makes about 20 times as much as the
cleaning staff. In US corporations, the average CEO makes 180 times as much
as the lowest-paid worker. Worst of all, for-profit health care affronts
the whole ethos of medicine. It “severs the community roots and Samaritan
traditions of hospitals, makes physicians and nurses into instruments of
investors, and views patients as commodities.”

This spectacle of avarice and plunder might find some justification if it
actually delivered superior results. But a 2002 study by Devereaux’s
research team showed that death rates in investor-owned hospitals and
kidney dialysis centres were significantly higher than in non-profit
institutions.

“Our previous study showed the profit motive results in increased death
rates, and this one shows it also costs public payers more,” said Dr.
Devereaux. “With for-profit care, you end up paying with your money, and
your life.”

The study is important to Canadians, says the Canadian Medical Association,
because these are the same companies who would quickly buy up Canadian
hospitals if they could. And the Devereaux study estimates that if Canada’s
hospitals were privately owned, they would cost the Canadian taxpayer $7.2
billion more a year. That’s equivalent to 72 sponsorship scandals every year.

Think about all this when you vote. Paul Martin’s health minister, Pierre
Pettigrew, opined in April that “the Canada Health Act does not preclude
delivery of services by private elements as long as there is a single
public payer.” Stephen Harper says exactly the same thing: “It does not
matter who delivers health care; it matters who can receive it.”

Inferior health care at larcenous cost may not matter to Pettigrew and
Harper. But it certainly matters to the rest of us.

— 30 —
PLEASE REPLY TO: [e-mail]

Silver Donald Cameron
Box 555, D'Escousse, NS B0E 1K0
[phone]
www.islemadame.com/sdc/
Weekly newspaper columns: http://groups.yahoo.com/group/sdcns/join

[BurtWorm]

30. Superb article! Excellent dissection of the free-market fallacy!

This bit, which cites the Frist family business as an example of free-market fraudulence in health care at work:

Free-market dogmatists argue that competition will ensure the best possible product at the lowest possible price. In other fields, that’s true — but in health care, it’s a fallacy. First, many hospitals have no real competition; my local hospital is the only one for 80 kilometres in any direction. Second, hospital patients are not model consumers, shopping around for the best price and the highest quality, and refusing to buy if the cost is too high. They are usually frail, elderly and/or desperately ill. They take what they can get, and pay what they must.

From a business viewpoint, one could hardly ask for a more glorious opportunity than this: a desperate customer, an essential service that’s difficult to evaluate, and a lack of competition. And if the costs are being paid by government — which rarely quibbles about a bill, and never goes bankrupt — that’s even better.

But not for patients or taxpayers. Commenting on the Devereaux study (which they describe as “meticulous”), Harvard professors Steffie Woolhandler and David Himmelstein note that for-profit hospitals “are profit maximizers, not cost minimizers” and that “strategies that bolster profitability often worsen efficiency and drive up costs.”

Such strategies, say the Harvard duo, often cross the boundary into outright fraud. Columbia/HCA, the largest US hospital firm, “has paid the US government $US1.7 billion” in fraud settlements, and Tenet, the second-largest, has paid settlements of over half a billion dollars. The frauds included kickbacks to physicians, over-billing, and such antics as “performing cardiac procedures on healthy patients.”

[porkrind]

43. Excellent Snippet (n/t)

[bleedingheart]

28. Same thing is happening to me and I am not even in a union

each year my raise is eaten by my healthcare.

[JanMichael]

31. My bitching worked, go figure...

:-)

[Redleg]

32. Perhaps the worm HAS turned. Thank you for drawing attention to it.

Mabye we DUers will engage in meaningful discussions of economic issues. I'll keep my fingers crossed.

[bleedingheart]

33. My mother thinks that people today must be drugged not to notice

how they are getting f*cked by corporations.

This problem started when we put corporations and business first...ahead of people .

[JanMichael]

40. That decision was made prior to the 20th Century.

The Progressives (People's Party et al) discovered the Corpo power first hand, as did Long and the pre-Defeated Depression era populists, fact is that the Centralization (Read massive institutional Income Inequality) of Economic Power has been literally unimpeded in a Century.

Gotta hope for the future though, and these current loons might be just the right loons to break the Power of the Plutocracy.

[salin]

34. Working with a nonprofit

with almost nonexistent margins. Trying to project hc costs beyond the given year for budgetary strategic planning is becoming harder and harder.

I predict that we WILL have health care reform - and sometime in the next 5-10 years. The push back against insurance and the medical related fields that have stimied othe efforts will come from corporate america itself - as more groups (some already are their) realize that it would cost them much LESS over time to pay slightly higher taxes and not have to pay health care benefits directly (in some kind of single payer plan). As that time comes closer, and more corporate titans band together - suddenly the will to create change (as big donor interests fight against other big donor interests) will be found.

Very sad that it will not come about due to the need for universal coverage, nor the needs of citizens, nor the needs of small businesses and nonprofits. I don't think it will happen til the massive monied class finds it hitting their bottom lines too hard. But I think with the rapid escalation of HC costs annually - the time is coming more quickly in which the issue will be have to be addressed. The current situation is literally unsustainable.

[louis c]

42. You're correct

As we compete in the Global Economy, Health Care is added to the cost of goods in this country, but other countries have the governments picking up that tab, giving other nations' businesses an substantial and unfair advantage.

[bleedingheart]

35. bump!

[bleedingheart]

38. People Abort fetuses they can't feed because they aren't earning enough

...wonder if that will suddenly make people care about this very important issue regarding wages and healthcare which I think is far more important.

You can't eat if you don't earn enough...when they bleed you dry you make decisions you might not otherwise make.

[bleedingheart]

39. Do you have proof of the low profit margin and what are the

salaries and raises of the management?

Do they have the same healthcare as the union? Better or worse?

Can the Union help choose what healthcare plan or perhaps ask this company to combine with another similar company in negotiating better healthcare rates?

Another option is to have a tiered system of healthcare available to workers in the union, they an pick from different options which then gives them the ability to determine what comes out of their paycheck...granted that is a risk that they would have to take as long as they are well informed about it. (that is what I currently but I am non union)

[louis c]

41. Please read #11 by louis c

[Bandit]

44. A new Kerry Ad on Health Care

http://mfile.akamai.com/10211/rm/johnkerry.download.akamai.com/10211/062104_paperwork_real_dsl.ram

Check it out and donate to help get this out to more people