In the Nick of Time

Association Action Key to Preserving Papillion-LaVista’s Health Care Plan

Last November, Papillion-LaVista Education Association leaders knew a school district committee was exploring the health care coverage provided to employees through Blue Cross and Blue Shield of Nebraska.

They knew the committee had met twice. But the ink on a tentative, two-year contract agreement between the Association and the district was still damp when they learned what was likely to happen at a third meeting.

“We didn’t realize there was going to be a committee recommendation,” said PLEA President Dave Herbener.

That recommendation reportedly was to ask the school board to end a decades-long relationship with Blue Cross for the promise from another insurance carrier of $2 million in savings the first year and $1 million in savings the second year. While Herbener understood the allure of savings, he said the proposal soon raised the blood pressure of hundreds of employees who had scores of questions about the future of their health care coverage.

“There was an overall concern about the level of care that people would receive under a new carrier,” said Herbener.

The concerns included the future of coverage for retirees and soon-to-retire district employees. There were concerns that existing doctors, dentists, specialists and mental health providers might be outside the new network. The new network’s long-term stability was a concern. Would there be a big bump in premiums in the third year?

Also watching were members of the Educators Health Alliance Board of Directors – which includes six NSEA members. The EHA board manages the Blue Cross plan for more than 250 Nebraska school districts.

What ensued in the four months following that November turning point was a series of lessons about Association work and the benefits of Association membership. Those lessons covered grassroots organizing, contract appendices, the worth of insurance pools, the value of mental health care and more.

The most important lesson of all was this: There is value in the collective power of Association membership.

Blue Cross Blue Shield ‘Did It Right’

Following the exploratory committee’s third meeting, Herbener and NSEA Organizational Specialist Judy Roach met with district officials to gauge the status of the recommendation. By mid-January, Herbener was certain the district would depart from EHA, and that administrators had not talked to Blue Cross about options.

“The district was under the impression that Blue Cross wasn’t going to do anything different,” said Herbener. He urged administrators to reach out to Blue Cross. Intrigued, the district made the call, and met with Blue Cross reps in mid-January.

“Blue Cross did it right,” said Herbener. “In fact, they kind of knocked their socks off.”

One administrator told Herbener that Blue Cross “gave us a lot to think about.” That included a plan to save the district $1.2 million in 2019-20. 

In addition, the Educators Health Alliance and Blue Cross had been working for more than a year to develop a program to lower costs using alternate networks. The company had targeted Papillion-LaVista and four other districts as pilot locations, though no offers had been extended.

While the proposed $1.2 million in savings and the Blue Cross record of stability and excellence were compelling arguments, Herbener said there was still no indication the district would waver from the recommendation to cut ties to EHA.

So, PLEA leaders rolled up their sleeves and went to work.

The Grassroots Get Organized

By mid-January, it was known that school officials were planning informational meetings for employees covered by Blue Cross.

With the help of Roach and other NSEA staff, informational fliers were assembled. PLEA’s Building Assistance Teams (BAT) got busy distributing the fliers, spurring discussion, answering questions and reminding members of meeting dates as they became known.

“We knew that it was really important to get staff talking about this and asking questions,” said PLEA Vice President Jared Wagenknecht.

The fliers and the BAT team members urged staff to ask legitimate questions about the switch to give the leaders as well as district officials a better understanding of staff needs regarding health care. 

“The more people we had involved, the better,” said Herbener, “and they were all talking about it.”

PLEA leaders also helped the district develop a survey of district employees. Nearly 900 employees responded, and the results reflected PLEA-led discussions in the buildings, the flier and social media posts. Wagenknecht said the survey results “played a major role” in the district’s ultimate decision.

“It was almost unanimously ‘we do not want to switch to a non-EHA carrier,’” said Wagenknecht. “I think the board was genuinely surprised.”

Even with survey results in hand, Herbener remained skeptical.

“I was 100 percent certain the district was going to switch. We all felt that way,” he said.

Nothing Beats a Big Risk Pool

Two district informational meetings were held in late January, and another in mid-February. Each was vital for Association members, their families and even the administrators who were tasked with evaluating the recommendation to switch carriers. There was also the issue of stability, not only for Papillion-LaVista employees and taxpayers, but for the statewide EHA family.

“I think long-term stability was important,” said Herbener. Blue Cross, he said, has that stability and reliability.

“Blue Cross has a huge risk pool of almost 80,000 lives covered, compared to a couple of thousand lives in the other carrier’s pool,” he said.

A general principal of insurance is that the more lives covered, the lower the cost; the fewer lives covered, the higher the risk and the higher the cost. The EHA plan through Blue Cross and Blue Shield has a record to show exactly that.

“The EHA plan keeps rates low. The 10-year average (rate) increase is 3.5 percent. Nobody can match that. Not even close,” Herbener said.

About Those Appendices

Beating EHA’s Blue Cross program costs, while matching services, was going to be tough, but that’s exactly what the outside company pledged, with reason. The contract between PLEA and the school district includes an appendix that says if the district switches insurance plans, the new plan must be comparable in both coverage for, and cost to, plan participants.

Herbener and Wagenknecht wondered how the company might match services while promising to save $3 million over two years.

“They’re not going to give you money up front without taking it from somewhere else. The only other place to take it is to not pay claims. There was concern about that,” said Herbener.

Wagenknecht said the district was following the corporate model used by other school districts, where the service is put out to bid, comes back at a lower cost and “almost always means that teachers get less benefit or less of something.”

The Cause of High Anxiety

“Less of something” began to show after the PLEA leadership began to dig a little deeper.

The leadership team pushed members to check with health care providers and report back. Numerous members found their providers, reportedly part of the new network, were not. Among the findings was a huge drop-off in mental health care providers; a huge drop off in dental care; a drop off in after-care therapy; and a drop in physical therapy care.

“That’s a pretty big chunk of service where there was going to be a pretty big drop off,” said Herbener.

The pending switch also caused high anxiety among already retired and soon-to-retire members. For those who retire before age 65, the existing EHA plan allows purchase of Blue Cross insurance until Medicare age, provided the purchaser was a plan member for five years preceding retirement.

Herbener said that while the new company reportedly had a plan to take care of retirees, no details were ever presented.

“To me, that’s not a plan,” he said.

Grassroots Begin to Grow

Organizing efforts began to pay off at the third informational meeting on Feb. 18. Then, when nearly 300 district staff attended a March 11 board meeting, school leaders noticed.

“There were lots of good questions that were fairly difficult to answer, because they were legitimate, tough questions,” he said.

Wagenknecht agreed. “I think that our organizational capacity to let people know, to get the word out, to get members out, was huge for our members and non-members to see,” he said. “So often people ask, ‘aside from my contract, what is it that PLEA does?’ This was something tangible that people were able to see at every meeting.”

“We had a wide variety of people speak so the board would know it wasn’t just a small group of people with concerns,” said Herbener. “That made the board take notice.”

Alternative Network Savings

Few knew that the EHA Board and BCBS Nebraska had been working on the alternate networks pilot project.

Such networks allow employees to choose coverage from one of three alternate networks – ranging from a broad network of providers to a smaller network. The alternate networks feature fewer hospitals and doctors, and are available in specific geographic areas, all factors that keep costs lower.

The belief is that alternate networks would offer savings for the employee, the district and the EHA plan used by all but four Nebraska school districts. The pilot would help determine whether alternate networks are viable.

With alternate networks, employees understand the need to monitor use of providers quite carefully to avoid out-of-network costs.

“We believe the savings will be attractive to more districts and to members as well,” said Neal Clayburn, NSEA’s associate executive director and chair of the EHA Board of Directors. “And that’s yet another instance of the power of your Association membership.”

The Decision is Made

Leading up to the school board’s two March meetings, Herbener was in contact with district officials, asking whether retention of Blue Cross was on the table. He emailed the superintendent several times to reiterate that the opportunity to keep Blue Cross was still available.

When the board’s March 11 agenda was published, it included the committee’s recommendation to stay with Blue Cross and Blue Shield. The board delayed that vote until March 25. When the vote came, the board voted – unanimously – to stay with Blue Cross.
Herbener and Wagenknecht were both surprised and pleased. Organizing, informing and advocating for members made a difference.

Today, the district is organizing meetings to assist members as they select a network, looking forward to new choices for health care – choices offered under the services of Blue Cross and Blue Shield of Nebraska. That’s the power of Association membership