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Dear ATPAM Member:
One of the most important topics in upcoming negotiations with the League
of American Theatres and Producers will be health insurance. Not
surprisingly this topic is dominating labor negotiations nationwide. The
purpose of this communication is to give you some background on where we
are today and what needs to be accomplished in collective bargaining with
the League so you can better understand the issues facing us as we begin
that process.
As you know, nearly two years ago, the Trustees of the League-ATPAM
Welfare Fund made drastic cuts in the eligibility rules making it much
more difficult for members with sporadic or seasonal employment to qualify
for benefits. This was done in response to actuarial projections that
showed the Fund rapidly moving toward bankruptcy -- primarily as a result
of skyrocketing healthcare insurance premiums nationwide.
Recognizing that the problem could not be addressed entirely on the backs
of the plan participants with benefit cuts, ATPAM sent a letter to the
League last year asking for a "re-opener" of the MBA and MOA prior to
their expiration. The purpose was to discuss and attempt to address the
financial crisis being faced by the Fund in a joint and cooperative
manner.
The League refused that request offering the opinion that they did not
believe that the Union had done enough in terms of cutting benefits to
control costs. This assertion ignored the obvious fact that the severe
benefits eligibility cuts had already negatively affected scores of ATPAM
members who were no longer able to qualify for any benefits at all. The
League additionally made the false claim that ATPAM already receives
higher employer contributions into our Fund than most of the other unions
in the industry. The facts and history on this were presented to ATPAM
members at the October 2003 General Membership Meeting. That PowerPoint
presentation was also posted on the Union's web site and is still there
for you to review.
At the October 2003 meeting of the Welfare Fund Trustees, the League
Trustees demanded approximately one (1) million dollars in immediate
benefit cuts. Their laundry list was very extensive and would have begun
to gut the plan of benefits with no guarantees that the cutting would stop
there. This proposal was based on what later turned out to be flawed
actuarial projections that did not even include a realistic analysis of
the effect of the eligibility cuts or potential increases in employer
contributions as a result of imminent collective bargaining.
The ATPAM Trustees refused to agree to this proposal and made a counter
proposal for a much less severe set of cuts (with all actions postponed
until current data is made available and analyzed.) They also proposed an
increase in the free continuance after the end of covered employment from
8 to 12 weeks. This was proposed in response to member input on this
subject. At the end of the day, the Trustees deadlocked and the entire
matter was to be submitted for arbitration.
In the interim, the audited financial statements of the Fund were released
by the Fund CPA and showed a much less dire cash position than had been
previously projected by the actuaries. The ATPAM Trustees had been
correct and prudent to hold the line. At the January 2004 Trustee
meeting, the ATPAM Trustees re-submitted an updated version of their
original proposal. After caucusing privately, the League Trustees agreed
to every item except the proposal for a 15% reduction in administrative
costs from the plan professionals retained by the Fund. Their rationale
was that the Trustees were not in a position to demand roll-backs in
retainer fees already in place. They did, however, agree that lowering
these administrative expenses should be a goal and agreed to work
cooperatively to accomplish that in a sensible manner.
The changes in benefits agreed to by the Trustees will become effective
April 1, 2004. Most participants should not be significantly affected by
those changes. The Fund office will be officially communicating the
changes directly to the plan participants very shortly. The Fund Office
personnel will also be available to personally answer any questions
members may have about how these changes may affect their individual
situation. Please dont hesitate to call them.
In brief the changes in the plan of benefits are as follows:
BENEFIT REDUCTIONS:
A new $500.00 deductible on hospital stays. (Currently none)
A 20% co-pay on prescription drugs with a minimum of $3.00 for generic and
$7.00 for brand names.
Mandatory mail order for chronic prescription drug use will be $7.00 for
generic and $15.00 for brand names. (2 in-store
refills allowed)
A 50% reduction in Medicare Part B. reimbursement for pensioners.
COBRA will now include 100% of administrative costs (currently 50%)
BENEFIT IMPROVEMENT:
Plan participants who enroll in HIP when they first qualify for benefits
(or during a January open enrollment period) will receive twelve (12)
weeks continuance free of charge when they leave covered employment as
opposed to the current eight (8) weeks. There will be an initial open
enrollment period to switch to HIP beginning April 1, 2004 and running
through the month of April only. Additionally, HIP participants will
continue to be subsidized for 50% of the administrative cost to the Fund
when they elect COBRA. Switching from the ULLICO/Magnacare PPO to HIP at
the time of COBRA election will not be permitted. The object of this
benefit improvement is to encourage members to sign up for HIP, which is
more economical for the Fund than the ULLICO/Magnacare PPO. Please note
that HIP is only available to members in the New York Metro area. The
Trustees are considering lower cost options for members residing in other
regions as well.
While we can take some satisfaction that staying the course has paid off
with a more positive short-term result than we might have otherwise seen,
there is no room for complacency. The fact is that the Welfare Fund has a
negative cash flow that will eventually bankrupt it if that cash flow is
not corrected. There is no question that additional changes to the plan
design will be necessary over time. However, if the League employers step
up to the plate and agree to appropriate and sensible increases in weekly
contributions to the plan, we can preserve the current high level service
provided by our Fund. It is easy for our employers to say that they value
their key ATPAM employees. Words are cheap. It is now also time to show us
the money. We have done our part, now they must do theirs. That is the
message we must send loud and clear at the bargaining table.
Fraternally,
Gordon G. Forbes
Secretary Treasurer |
