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Volume 3, No. 18 - Summer 2000
Health Benefits Plan Teeters On The Edge
Forty years ago the National Association of Letter Carriers experienced an unprecedented enrollment period spear-headed by the union's acceptance into the Federal Employees' Health Benefits Act of 1959. Overnight the NALC went from an enrollment of 30,000 to 101,503 members.
It was a time of great expectations among the NALC. Critics didn't think that a union-owned health plan belonged in the same arena as the high roller health providers of Blue Cross and Aetna. They thought it would be a "flash-in-pan" episode waiting for it to fold. However, instead of going under the Plan grew to a size that had 520 employees and a membership of 220,000 by 1990.
Now, today, as the membership gathers in Chicago for the 62nd Biennial Convention President Vincent R. Sombrotto will undoubtedly paint a very different picture. One that could easily become a focal point of the convention.
Many of the members in the Plan today are retirees who joined during those early years. But even the annuitants are leaving. A head count today reveals 103,400 total members enrolled, and of those 18,766 are postal employees, 3,471 other federal employees, and 81,163 retirees.
What began driving the members away was one of the largest premium increases along with cuts in benefits. However, those increases have turned around with the premiums dropping and some benefits reductions have been restored.
That doesn't seem to be enough though. Younger union members today are not joining up for the Plan, one which has stood an unbelievable test of time. Instead they are opting for cheaper plans which on the surface pretend to provide more bang for the buck, but do they really?
Even more importantly though the retirees are leaving the Plan. Their desertion of the NALC HBP is more than just a frugal move - it's a statement. Many of those who are using the Plan have been doing so since the beginning. They have stayed with the Plan out of loyalty to the union more than they have out of loyalty to their wallets.
Most of that dedication is deep-rooted in the 1950's when the Plan got started. In 1950 when the members began to sign up they paid 100% of the premiums out of their own pockets, a monthly premium of $6.35. The benefits included a $10.00 daily hospital room payment; $200.00 in miscellaneous benefits (X-rays, lab fees and so forth) and a surgical schedule with a $200.00 ceiling. The total maternity benefit was $50.00. Not much by today's standards, but the prevailing factor was that it was union.
If ever there was a time when union strength and solidarity was at its peak, it was in the 50's. America was leaving WWII behind it, factory jobs - union jobs, were good, and there was hope for those who began working in the 50's that they could reach retirement with the same company.
For many of those unionist the solidarity reached beyond the time clock touching the family through union picnics, and other such group outings. But for NALC members, who were government employees, a health benefits plan was important, and leading the charge up Capitol Hill was the NALC.
Getting Congress to agree to creating a Federal Employees Health Benefits system was one thing, getting it to agree to include hundreds of thousands of retired federal employees was another. The impending health plan did not include the retirees. A serious omission.
On August 21, 1959 various groups petitioned Congress to include retirees in the new plan. The NALC through President William C. Doherty, was one of them.
President Doherty, was Chairman for Government Employee's Council of the AFL-CIO, he had a letter submitted to be read, which was made part of the official Congressional Record.
"There is one serious omission from that bill that gives us a great deal of concern. That is the omission of those presently retired, as well as the survivor annuitants on the rolls. There are 311,000 retirees and 132,000 survivor annuitants. These folks receive very small annuities and the older the retiree, generally the smaller the annuity he receives."Congressional Record - Senate, page 16,642, August 21, 1959, 86th Congress, First Session.
Senate Bill No. 2162 was amended to include Federal retirees. The NALC was there to make sure its voice was heard.
Today, as President Sombrotto will surely tell us, the NALC HBP is at a very dangerous cross roads. It is sick and is in need of a very important transfusion. One that will require thousands of NALC members to sign up and help pump dollars into the operation of the Plan.
It is difficult for many of the Plan members to be attendance at the conventions to have to sit and listen as those who don't belong ask the delegation to lend support in boycotting those companies that refuse to acknowledge unions. How ironic it is that they are asking for this to happen while they don't even support the only letter carrier union health plan in the Federal Government.
"Since the Fleischli arbitration award, I have read many stirring articles admonishing non-NALC members that the time has come for them to 'pull their own weight' and join the union. My guess is that quite a number of these authors do not have the NALC Health Benefit Plan.
"It is past time for these brothers and sisters to complete their leadership obligations by joining the Plan and, through their example, lead others to join also," Tom Young, Director NALC HBP.