The Martlet

Students who purchase the UVic Students’ Society (UVSS) health and dental plan are not getting the best deal available, according to UVSS Chairperson James Coccola.

Under the new plan, which will take effect in September, students will pay $148 for health coverage and $140 for dental, totaling $288. The premium paid to insurance provider Greenshield is $256.08 per student; the extra $31.92 is collected by the UVSS as an administrative fee. This year, approximately $200,000 will be collected in administrative fees.

But Coccola, who campaigned on reforming the health plan, doesn’t feel the new plan is the best deal available.

“I think that if we’d done it differently, we could have done a better deal,” he said.

The contract for the new health plan was signed by outgoing Director of Finance Edward Pullman on April 29.

Coccola said he is disappointed this contract was signed before the incoming board had a chance to look at it.

“It’s really unfortunate that we are where we are,” he said.

Coccola says that, under UVSS policy, the Director of Finance is supposed to come to the board with contracts of this size, but adds “that hasn’t been followed in recent years.”

Pullman, however, says that, historically, it is the outgoing Director of Finance who signs the health contract for the incoming board.

“Typically, each year how it’s worked is the health plan and the handbook are handled by the previous board for the board coming in, because there are certain deadlines that have to be met,” said Pullman. “Basically there’s no precedent in previous years for that carrying over into the summer.”

Student Union Building (SUB)General Manager Marne Jensen, who has worked for the UVSS for nine years, agrees.

“It hasn’t come up as an issue with the new board in the past,” she said.

One issue new board members identified with the plan is a decrease in dental coverage from $1,000 to $750, and from two checkups per year down to one.

Pullman said this is due to an increase in usage of the dental coverage.

“Like any good insurance company, they’re going to say if you want to maintain that level of coverage, we’re going to have to jack up your premium substantially,” he said. “Sometimes it’s simply impossible to maintain a certain level of coverage without having to put up your fees and when you can’t put up your fees above a certain point you have to look at increasing your deductible.”

Jensen said Greenshield is reviewing the increase in dental usage.

“The insurance company is currently reviewing the dental claims to see if there are any unusual patterns or billing practices that could explain that,” she said, “but that’ll take some time.”

Pullman said if the current board isn’t happy with the contract, they have the ability to change it. However, he added, they are currently choosing not to.

“I believe that’s because they also realize that’s the best decision to make with the current situation,” said Pullman.

But Coccola said changing the contract simply isn’t easy to do.

“There is a risk in simply tearing up the contract. It could cost us money to tear it up,” said Coccola. “And we do need to have a contract in very soon.”

According to Pullman, the UVSS received two bids for the contract, Greenshield and a Quebec-based company called Desjardins. Pullman says that while both bids were good, Greenshield was selected because they offered greater flexibility for students opting out of the plan.

“I don’t buy the argument that the board finds that unacceptable,” he said.

The fact that the plan was signed by the outgoing Director of Finance is not the only thing worrying new board members, however. They are also concerned about the $200,000 that is being collected as administrative fees.

UVSS audits from 2007, 2008 and 2009 show administration fees of approximately $90,000 per year.

“There are obviously administrative fees to covering a plan like this. We have management that’s working on this very heavily and we have a lot of staff,” said Coccola. “But it shouldn’t cost as much as they’re charging for it. Where exactly it goes I’m not exactly sure.”

Jensen said the administrative fee goes towards the infrastructure that supports the health plan, including things like staffing the info booth, support services and the administration manager. She said the additional funds go into the operations fund to help balance the budget.

Current Director of Finance Kelsey Hannan said he didn’t know about the administration fee until he took office on May 1 and gained access to all the UVSS financial documents.

“[In spring 2009] our finance director made an agreement to reduce our coverage and our premiums. So they reduced the coverage by eight per cent. The quality of the plan went down. But instead of the plan becoming cheaper they increased the amount they took. And this was essentially a way of reducing the deficit,” said Hannan. “Basically what they did is they reduced student’s coverage, made the plan cheaper, but didn’t make the plan cheaper because they took the extra cut.”

Jensen also says that, while the amount the UVSS pays Greenshield decreased, the amount students paid did not.

“This past year we saw an eight per cent reduction in our premiums; we did not pass that to the students,” she said.

Jensen said that because of the UVSS’ financial situation, management advised the UVSS to take advantage of the fee.

“Because there’s a significant deficit coming from the strike and the cost of the wage package coming from the strike, we’re still struggling to rebalance the profitability of our operations,” she said. “And so we’re relying on heavily on the admin fee while we make the structural changes to bring the costs in line.”

Hannan does not feel this increase in administration fees is fair to students who purchase the health plan.

“It’s sort of a back door tax in some ways,” he said. “We’re getting this top up that we don’t think is right; I want to make that clear.”

While Coccola and Hannan want to see the administrative fee reduced, Hannan notes that doing so will not be an easy task, given the UVSS’ current financial situation.

“The scariest part about this is we’ve got $200,000 on the plan and we still posted a deficit that year,” he said. “That means even with this bump up we’re in a bad financial situation, and that means a lot of tough decisions.

“We’re even further behind than we thought.`

-with files from Gemma Karstens-Smith