Tuesday, July 14, 2009

Health Insurance Rant

I am currently firmly standing on my soap box so just warning you.

Yesterday I received the ominous note from the Conference about the 2010 Heath Benefit Rates. When I read them I defecated a molded rectangular block of clay. Here is what part of the letter said [the blocked letters are theirs not mine] REMEMBER THAT THESE PLANS ARE SELF INSURED BY THE CONFERENCE AND THERE IS NO INSURANCE COMPANY INVOLVED IN THE RATE SETTING PROCESS PRIMARY PHYSICIANCARE IS SIMPLY OUR CLAIMS ADMINISTRATOR AND RATES ARE BASED UPON THE ACTUAL USAGE OF THE PLAN BY CONFERENCE MEMBERS AND THEIR DEPENDENTS.

I understand but I also DON’T understand. Now I know you have to have attended MIT when you were 12 to fully understand health insurance today but the amount we pay has been going up every year by almost by double digit percentage. Let me paint you the picture.

For 2009 each church in our conference $9,300 a year / $775 a month for the clergy health care. If that clergy wants to have his/her family on the insurance then they currently pay $9,840 a year / $820 a month. These rates have both increased by 12.8% in one year. In 2007 the rates were: Clergy $6,060 a year/ $505 a month and Family $7,500 a year or $625 a month.

So for 2010 the rates are as follows: Church pays $10,500 a year or $875 a month and for family $11,100 or $925 a month. As you can tell this is why I defecated a molded rectangular block of clay. Within three years our health insurance (because it ain’t a benefit anymore!) has gone up by 73% for clergy and 48% for family.

Once again, and you can tell by the above statement, this increase is because of our usage. Which I takes as if we would stop using our health benefits they would go down. My view is if I am paying an arm and a leg I’m using the crappy benefits we have. But what this really means it is all our fault!

This is not the first time I have ranted on our Health Benefits, it seems every time this year I will rant and complain. At Annual Conference this year we were promised that our rates will continue to increase over the next 5 years to the tune of another 50%. This means the rates in 2015 will look like this: Clergy $13,950 a year / $1162.50 a month and Family $14,760 a year / $1,230 a month.

My two roommates from Seminary and my two best friends are in neighboring conferences. During a vacation together I asked them what their conference Health Benefits are like. Their numbers were half what we in the Western North Carolina Conference pay. Yes we are a large conference, the fourth largest [from my understanding] in the nation. We have more clergy to insure but something has to stop and it needs to stop soon because it is adding a huge stress on local congregations and clergy families.

I’ll be transparent here, I make $42,540 for 2009 which isn’t far off the base salary for an ordained elder. My family health insurance is 23% of my yearly income before tax. Almost of quarter of what the church pays me has too go to healthcare. Do not get me started about we actually have to pay. We are still in disagreement about how much we actually have to pay for having our daughter which somehow is more expensive than having our son when we stayed a day later in the hospital with him and other things. But it looks like we are talking $3,000-$3,500 out of our pocket [that is WITH insurance].

The bleeding has to stop at some point. With these benefits we are asking young clergy who are coming out of seminary with heavy school debt to then take a quarter of their salary to cover their family. It is putting a huge burden on our family and I am sure it is the same else where. We are looking into getting my wife and children on their own separate plan outside the WNCC. The trouble is we are looking into the tax ramifications as well. Right now I can deduct these costs from our taxes and moving them to a separate policy we want to make sure we can still deduct that cost.

For those of you out there smarter than I, is it Discipline mandated that health insurance is done within the Annual Conference? What would it look like to move to the Jurisdiction level? Then we would have a vast number of people who could cover the type of catastrophic costs our conference has seen over the couple of years. What if two or three conference got together to cover their health insurance costs? Is the Western North Carolina Conference the only one dealing with drastic changes like these? Please tell me we are not alone.

I am stepping off my soapbox here and thank you for being part of my venting. I am going to go back to hitting my head against the wall to dull the pain.


Wounded and Healing said...

My conference is one of your "neighbors" and just happens to be THE largest annual conference. I will probably never again be on the conference insurance, because my husband's benefits are SO much better. However, I was on the insurance for two years and have kept up with the rates. Even our most expensive option is HALF what yours is for 2010. I think expecting a family to pay almost $1,000 a month in premiums is ridiculous. Plus $3500 a year in out of pocket benefits? Crazy. You could indeed find a cheaper policy by going out on your own. How much is it for an individual?

Earl said...

Are you required to purchase your health insurance through the conference? If not, then take the money and go to a private plan. You can then select a healthcare policy offering options and deductibles that best suit the needs of your family and your budget.

The very high cost of many clergy healthcare plans stems directly from the age of those enrolled, their health issues and their usage of the plan. This is not unlike the position of small businesses where where the employee population is not sufficient to produce economies of scale. Judging from the note you quoted, this limited pool of participants, coupled with actual usage is driving the current cost of healthcare in your conference. It is not likely that any conference is going to subsidize the cost of clergy health insurance. As in private industry, it may be that conferences will shift some of the cost from the local church as individual clergy are required to pay a portion of the premiums. Realistically the only way to lower those cost is to increase the number of healthy participants, improve the overall health of all participants or reduce the services that are covered.

Unknown said...

Thank you all for your comments. The clergyperson assigned to a church can opt-out of the insurance but the local congregation still has to pay the cost of clergy healthcare to the conference. My personal healthcare is covered at 99%, I, next year, will pay 1% of my costs (which is only $105 a year) and as one's salary increase so does the % of what the clergy has to cover. The highest is pay has to put in 14%.

My family can opt-out anytime, it isn't required and we are looking into that. The issue we need to research is the tax ramifications of doing that move.

Earl you are excatly right, it is all about the age and health of the people being covered. That is why I think going to a jurisdictional level or multi-conference plan will help drive down the cost. How functional that can be is another question, one for those who sit on the committee.

Thanks again for the comments.

Talbot Davis said...

The staff at our church who are not under appointment with the UMC are part of a health care plan that is much less expensive than the Conference. Our business manager shopped and bought it.
Talbot Davis

Jonathan Brake said...

Jim, I hear ya brother. I've got a child with a pre-existing condition. We've considered putting my family on Alisa's insurance plan, but what do we do when I'm reappointed and are stuck with a child that takes $1000/month medicine? I feel trapped with this WNCC insurance plan.

Overall, my family is much more healthy than the average member of our conference health plan, so I feel that I'm having to pay for the many people who haven't/don't take care of themselves.

To me it's a spiritual issue to keep ourselves in good health (I think J. Wesley would concur), not just for the sake of our insurance plan but for the sake of our ability to do what God has asked us to do. I hope and pray that the Duke study on clergy health will offer some real solutions and that our colleagues will take the necessary steps to do what's necessary. Now, I need to go upstairs to the treadmill ...

Unknown said...

UPDATE: Since my wife is self-employed, we can deduct the cost of health care if her and our children move to their own health care policy. We are currently shopping around and they will go off conference health care by 2010.

I also found out that there is a UMC policy that about 26 conference are involved in. Our conference committee on Health and Pension doesn't think we would benefit from this much. I was told we would have less autonomy.

Anyone on the General Conference Insurance? What is that like?

Jennifer said...

I'd like to revive this discussion with a link to a report by the Kaiser Family Foundation:

This report shows that in 2011 the average annual premium for covered workers who are in the South and have a self-funded plan is:

                             $15,500 for family
                               $5,500 for single coverage

It seems that the plans are single OR family coverage.  They do not add the two numbers together.  

According to the report, 80% of the plans cost below $18,600 (or 120% of the average).  

In the Western North Carolina Conference of the United Methodist Church for 2013, the local church (and clergy) will pay:

$13,788 for the clergy person

and families will pay:


for a total cost of:


This is 174% of the average family plan.

How is this possible? Who can justify this? It's outrageous.

I would appreciate any insights regarding not only the cost of the family plan but more significantly, the mandatory (and obscene) cost for the clergy "Health Benefits."