Sunday, June 09, 2013

Oregon House Democrats Block $67 Million in Healthcare Savings for Oregon University Students

The Oregon University System (OUS) wants to leave the Oregon Public Employees' Benefits Board (PEBB). Oregon University System members see separating from PEBB and self-insuring as the road to saving tens of millions of dollars for Oregon university students. Oregon Republican house members support the $67 million saving, but Democrats in control of the Oregon House of Representatives refused to even allow a floor vote.

Hannah Hoffman of the Statesman Journal reports:
The House Republicans today requested a floor vote on House Bill 3508, a bill that would allow the Oregon University System to withdraw from the Public Employees' Benefits Board. It wasn't granted a vote, but this idea is likely not going away
. . . .
The OUS did a study last year on its options and found it could save $67 million if it opted for its own plan instead of PEBB, which is self-insured.

The Republicans are on board with this idea.

“We need to give our universities every tool we can to curb the ever-rising costs associated with higher education,” Rep. Bruce Hanna, R – Roseburg said in a written statement. “I can’t understand why the legislature wouldn’t want to pass a bill that would allow our public universities to save an estimated $67 million. How can we tell students, parents and faculty with a straight face that we are ‘doing everything we can to support education’ when a simple administrative cost-saving measure does not even get consideration?
[emphasis added]
It turns out that student tuition subsidizes other state employee PEBB costs because OUS healthcare costs are much lower. The OUS 2012 Health and Welfare Plans Report notes:
The university system’s distinguishing concern is that health insurance costs are significant drivers of tuition increases. By OUS’ analysis, in 2011-12 each 1% increase in the cost of group health insurance contributed a 0.63% increase to undergraduate resident tuition, and an increase of 0.24% to all tuition that includes graduate and non-resident students. With health insurance costs rising at rates of 5%-10% each year this is a significant driver of tuition.
. . .
Because tuition is such a significant revenue source for OUS, students and parents are primary payers of any increases in PEBB costs. (pp. 6-7) [emphasis added]
Oregon House Democrats seem unconcerned that Oregon university students are being saddled with $67 million in unnecessary tuition costs. These higher tuition costs put college education further and further out of reach of poor and middle class Oregon students, and result in significantly more student debt for those who do manage to enroll.


MAX Redline said...

Of course student healthcare costs are low - they're young and bulletproof, for the most part. Personally, I almost never used health services when I was young; when I left employment, I had over 2000 hours of sick leave on the books - and that despite having "donated" several hundred hours over the years to co-workers who suffered big issues (heart attacks, cancer, etc.).

They're jacking up fees and tuition because they have to, in order that older union members and others may benefit. After all, one must remember the Oregon motto, and employ it liberally:

From each according to his ability; to each according to his need.

T. D. said...

Exactly right, Max. The young do have much lower healthcare needs.

Still, the Dems cry crocodile tears over high public university tuition and student debt, and don't lift a finger to ally them even when it's so very easy.

MAX Redline said...

Most of the kids are coming out into a cruddy economy, with few job skills, and tens of thousands in debt. I was lucky; I got out with only about $2000 in debt due to having scholarships. Still, that was hard to pay off at $4 an hour (well above then-minimum wage).

And it's also why Obamacare is doomed to fail - kids don't see a need for insurance, and they can't pay for that while paying down debt and keeping a roof over their heads. It's cheaper for them to pay the penalty.

T. D. said...

Max, I can feel the demonization of HMO's coming. They will be under the bus as money grubbers raising healthcare costs to unacceptable levels. Though, they will deserve some of it since they planned to be the beneficiaries of pay them or pay the penalty. Every time I see one of Kaiser's happy face "articles" on how great the coming Obamacare system will be, I think of the coming squeeze on them with less and less concern.

Do you know where the penalty money is supposed to go? I'm assuming not to the HMO's who will still have to take care of anyone who "joins" after discovering the need for expensive treatment.

MAX Redline said...

TD, from what I've read, it looks as though the penalty goes into the black hole know as the general fund. So I think your assumption's correct.

T. D. said...

Thanks, Max.