Updated: Aug. 26, 2014 at 5:51 p.m.
A group of faculty leaders is asking the University to limit an increase in funds for merit raises this year, which they said would allow employees to pay fewer out-of-pocket health care charges.
The Faculty Senate’s Appointment, Salary and Promotion committee has asked GW to increase funds for health care more than funds for merit-based salary raises. Mathematics professor Murli Gupta, a member of the committee and its former chair, said he is expecting an answer from University President Steven Knapp and Provost Steven Lerman in the next few weeks.
The committee’s request comes after the Faculty Senate passed a resolution in May that asked the Board of Trustees to spend more to cover health care costs. Several professors said, at its May meeting, the Board approved a 3 percent increase in funds to cover employee benefits, which is in line with increases from the past few years.
“We are all hoping the administration will come through with somewhat more than a 3 percent increase [in health care],” Gupta said. “The amount of money that the board has approved for salaries and benefits is definite, but the only question is can funds from the benefits pool go to health care instead of another source.”
The University’s Human Resources Office is still finalizing health care rates and employee benefits for this year, University spokeswoman Maralee Csellar said in an email. Those rates are typically settled in early September.
Amid rising national costs and skyrocketing claims, the University’s health care has become more expensive in the last three years, forcing it to charge faculty more for coverage. Faculty members have said they need GW to offer them a better deal, as employees have spent more on health care than the University has grown in funding for health care benefits.
Darrell Kirch, president of the Association of American Medical Colleges, found in a 2011 report that the cost of employee health insurance at higher education institutions increased 6.7 percent for employee coverage and by 7 percent for family coverage between January 2009 and January 2010.
“This means that health insurance expenses for colleges and universities grew during this period at more than 2.5 times the rate of inflation,” he wrote in the report.
Health care costs made up $44 million of the $98.5 million the University spent on employee benefits last year.
Faculty members had hoped the University would spend an additional $1 million to cover health care costs this year, relieving them from giving up portions of their salaries to cover medical care. Health care costs for employees have risen nearly 25 percent since 2012.
Devon Herrick, a senior fellow at the National Center for Policy Analysis who specializes in health care costs, said charges rose at a slower rate for most of 2013 compared to the previous year. But he said increasing funding for health care coverage would take away from employees’ salaries.
“Workers like to think their employers give them free health insurance. They don’t,” Herrick said. “It’s part of your pay, part of your compensation, and if your employer is spending a lot on health coverage, that means there’s less money coming into your paycheck.”
Universities tend to give more “generous” health care plans than other kinds of employers, he added, and many faculty want more control over how their health benefits are paid.
A report by the Henry J. Kaiser Family Foundation found health insurance costs increased 5 percent for single coverage and 4 percent for family coverage between 2012 and 2013, slowing from past years’ increases.
In his report, Kirch found that when employees earn more health care benefits instead of salary increases, employers often notice morale deteriorate.
“Shifting costs to employees is not a long-term, sustainable solution. While it may save money in the short term, another cost must be considered: the impact on the institution’s reputation from decreasing employee satisfaction,” he wrote.
More than 150 professors signed a petition last semester asking administrators to roll back the 12.5 percent cost increase that employees had to pay last year. Several professors who signed that petition formed the Faculty Association at the end of last year, citing dissatisfaction with the Faculty Senate.
Tyler Anbinder, a history professor and founding member of the Faculty Association, said it was “poor policy” for GW to increase its contribution to health care costs by only 3 percent when costs are rising at a much faster rate.
“It represents a net decrease in my salary, because if my pay goes up a little but my benefits go down by the same amount, then even though the University wants to say, ‘You got a pay increase this year,’ in reality I didn’t get a pay increase because they paid for my raise by using my benefits,” he said.
This post was updated to reflect the following correction:
The Hatchet incorrectly reported that professors had asked the University to shift funds for bonuses to funds for health care. They had actually asked to see a larger increase in funds for health care than funds for merit raises. We regret this error.
