UM Employees to Pay More Health Care Costs

Saying that “our health care costs will paralyze the university unless we take action,” University of Michigan president Mary Sue Coleman said that employees and retirees will be asked to pay a greater share of their health care costs starting in 2010. She gave no other details about the plan, saying that the leadership of various employee groups were being informed today, with information to be released to faculty and staff on Friday morning. Coleman made the announcement during opening remarks at Thursday’s Board of Regents meeting.

The cost-sharing changes – which will be available in detail on UM’s Benefits Stewardship website Friday – will also be discussed at a series of forums to be held later this month, Coleman said. No changes in benefits are planned.

Coleman described health care costs as the university’s fastest-growing expense. The Committee on Sustainable Health Benefits was appointed late last year to look at the situation and propose recommendations to the administration. The goal of that committee was to provide a way to achieve cost-sharing in which the university contributes 70% of health care costs with employees paying 30% – an amount that includes health care premiums, out-of-pocket co-pays and deductibles. Currently, employees contribute 20% toward their health care expenses, according to the university. A similar committee was looking at retiree health care costs.