Newspaper article THE JOURNAL RECORD

More Unions Agree to Join Discount Health-Care Plans

Newspaper article THE JOURNAL RECORD

More Unions Agree to Join Discount Health-Care Plans

Article excerpt

While labor unions are still actively campaigning for a greater government role in health insurance, a growing number of them have agreed to participate in discount health-care plans.

Union officials say the plans can help stretch the limited dollars available for wages and other benefits as health costs keep rising.

The plans typically provide additional health benefits to participants who agree to use a network of doctors and hospitals known as preferred providers and who are pledged to shun unnecessary or wasteful services.

Such plans are offered as an option by dozens of smaller autonomous health and welfare funds operated by employers and unions in the trucking, construction and hotel and restaurant industries.

``Most unions prefer the preferred provider approach,which retains a modicum of employee choice,'' said Cynthia Hosay, a senior vice president with Martin E. Segal Co., a consulting firm.

The automobile industry, where contract talks with the United Automobile Workers union recently started, has offered a preferred provider option as well as membership in health maintenance organizations since 1984.

American Telephone and Telegraph Co. and its unions, which had been discussing the concept since last year, recently approved contracts with three large insurers to establish the nation's largest preferred provider, or managed care, network.

The Communications Workers and the International Brotherhood of Electrical Workers agreed to urge 100,000 telephone employees and their dependents to select doctors and hospitals in the discount plan.

Prudential Insurance Co., Travelers Corp. and Empire Blue Cross and Blue Shield will each run regional networks.

Every managed care network's operating rules are different, so it is hard to generalize about the savings and quality of care they deliver.

The teamsters' union's Central States Health and Welfare Fund, for example, which covers 150,000 employees in 23 states, spent $500 million on health care last year. Thomas Robertson, the fund's planning director, said discounts saved $3.8 million in 1989 in charges for 23,000 employees who enrolled in preferred provider plans.

To be effective, the plans must have economic incentives to control the kind and number of procedures that doctors order, not just to hold the line on prices, said Joseph J. Martingale, a principal with the TPF&C unit of Towers Perrin, a consulting firm, which advised AT&T.

In the telephone company networks, for example, a primary care physician will be responsible for deciding whether a patient needs a specialist or hospital care. …

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