The Buffalo AFL-CIO Council and Blue Cross & Blue Shield of Western New York Inc. said Friday they will develop an alternative insurance plan that improves access to medical care for union members, ensures high quality services and attempts to provide more job security for health care workers.
The 100,000-member council selected the Blues last week as its partner in a so-called Labor Health Plan. The new coverage may be available as early as 1998 to 50,000 union members and their families, providing an initial client base of about 125,000 people.
But not all of the council's more than 200 member union locals back the alternative insurance. Some labor leaders were surprised Friday by the announcement that a deal with the Blues had been reached.
They also said they feared the Labor Health Plan could accelerate job losses among unionized health care workers.
"We in the labor community are deeply concerned with improving the medical care delivered to our members and the entire community," said John J. Kaczorowski, AFL-CIO council president.
"Services are not where they need to be, in terms of proper access to quality care. We view the Labor Health Plan as a significant example of how labor's solidarity benefits everybody," he said.
Kaczorowski cautioned that the AFL-CIO and Blues cannot mandate that employers and employees sign-up for the new insurance coverage. However, they hope to convince companies to include it among the various medical insurance options offered to the rank and file.
"We are looking to provide basic, major medical coverage. We'll consider dental and vision benefits later on," he said. "The details of the plan haven't yet been worked out."
Kaczorowski hopes the Labor Health Plan will reduce insurance costs by between 30 percent and 40 percent, while at the same time boosting access and the quality of medical services.
Last summer, the AFL-CIO began examining ways it could help remedy the looming health care crisis in Erie County. About 55 public- and private-sector unions were invited to a series of meetings, he said.
Stuart Piltch, an insurance consultant from Philadelphia, was hired by the AFL-CIO to help find an insurer who would be willing to work with the unions on alternative coverages.
The major insurance providers were invited to participate in the development of the Labor Health Plan. But the Blues -- because they are locally based and heavily unionized -- were the only company to meet labor's criteria, he said.
"There are a lot of ways we could go," said Piltch of Buck Consultants, when asked about the type of insurance coverage. He said the Labor Health Plan may resemble a traditional benefits scheme or include elements of health maintenance organizations.
"We want to build a system that is a long-term solution for Western New York and that addresses labor's concerns," said Piltch, who also has served as a consultant to several Buffalo-area unions. His firm does work for corporations as well.
"Given the move toward hospital deregulation in New York State and managed care, I think the labor leaders were sharp to react in the way they have," Piltch added.
Some union officials have serious reservations about the proposed Labor Health Plan. While hesitant to publicly criticize the AFL-CIO leadership, they privately expressed concerns about the potential of any alternative coverage to spur further job cuts at local health care facilities. Several people said they felt excluded from Big Labor's decision to forge an alliance with Blue Cross/Blue Shield.
At least one leader of a major union in the health care industry chose not comment on the Labor Health Plan. Debora Hayes, president of Nurses United and head of the Communications Workers of America's area council, was unwilling to discuss the insurance plan.
Kaczorowski, the AFL-CIO president, acknowledged that some labor officials "have concerns." But he pledged that the health-care unions will play a key role in the drafting of the Labor Health Plan.
"Key to our talks to this point being successful was our understanding that the labor community is just that: a community," said Robert J. Boden, the Blues' senior vice president for corporate marketing. "Although unions represent all types of workers, there are commonalities which require a tailor-made system of plans and services," he said.
Blues' president Thomas P. Hartnett described as "a natural" his company's agreement with the AFL-CIO to develop alternative coverage. He noted that the Blues are the only area insurer where a majority of workers are represented by a union: Local 212 of the Office and Professional Employees International Union.