Saturday, June 22, 2024

At SECU: The Employee Covenant - Health Care ... caring, costly, crucial. 

Healthcare as a benefit is not the most logical place to start a discussion of a covenant with SECU employees, but since we've touched that "third rail" already ...

Providing health insurance for employees - both active and retired - has always been a challenge for SECU and all employers. For example, N.C. State Treasurer Dale Folwell is currently before the Legislature seeking $300+ million to boost the financial soundness of the State Health Plan, which covers over 800,000 North Carolinians. The majority of people obtain coverage through their employer, which helps lower costs and provides employees with the advantage of a skilled administrator - working on their behalf.

Healthcare insurance is both a financial and an ethical dilemma for an employer. How an employer chooses to wrestle with those two difficult issues speaks clearly to an employer's core values - SECU is no exception. 

The puzzle confronted with healthcare starts with the fact that your health is quite often a random, "luck of the draw" blessing or problem. People, for the most part, can't choose their personal health profile - or else we would all choose "healthy" over "unhealthy". We can all work on diet, exercise, alcohol, and tobacco; but genetics, a physical disability, a chronic disease, a difficult pregnancy, or a catastrophic auto accident may strike any of us - at any time. Plus - due to the cost (and a little fear!) -  many of us unwisely delay seeking healthcare when problems first arise.

Add to the puzzle that young employees believe they don't need coverage, older employees can't live without it; and when incurred, medical costs are astronomical and well beyond the budgets of most families.   

In the past, the SECU Board decided that providing healthcare coverage to all employees was an ethical necessity and a professional requirement for the credit union. The basics were as follows:

  1. SECU would provide high quality individual health coverage for every employee.
  2. Participation by all employees was mandatory - even for those who did not plan to get sick or die.
  3. Each employee, regardless of position, would receive the same health coverage - no perks or separate plans for muck-mucks.
  4. Active and retired employees would be administered within the same insurance pool.
  5. The cost of individual employee coverage would be borne by the credit union.
  6. Dependent and family coverage would be optional and at the expense of the employee.

The simple goal was an attempt to administer the health coverage as a broad, single cooperative pool. Everybody had the same stake in the game! No one would be preferred, no one would be cut out, everyone was in the same "self-interest" boat!  The responsibility of the credit union was to the individual employee, coverage would be equal for all - regardless of employee position or status - active or retired.

Many employers are trying to solve "the healthcare puzzle" by shifting the future liability of rocketing costs entirely to employees. Fixed dollar employee healthcare "allowances" cap the financial risk of rising costs for SECU. Good finance perhaps, but certainly poor ethics in SECU employee relations.

By capping the retired health benefits of most current employees and retirees - and by eliminating retired health benefits entirely for new SECU employees - the principles and ethics of healthcare at SECU appear to have changed. New, young SECU employees were evidently misguided into giving up this important benefit. Now longer-term employees and retirees are apparently on the chopping block. SECU employees - active and retired - should pay close attention to any proposed changes. The SECU Board and ELT may no longer be working in your best interests.

The suspicion is that the SECU Board now values "a most profitable year ever" over and above the healthcare interests of  current and retired SECU employees and their families. 

Starting to see a pattern here?... yet another unhealthy unforced error?