Penn State will introduce additional cost-sharing measures to its employee health-care plans in 2011, the university announced Wednesday.
Details about those and other changes will be outlined in mid-August, according to the announcement, which was released through Old Main.
Workers will see the extra cost-sharing ‘at the time an employee or one’s family member receives medical care through the introduction of deductibles and co-insurance,’ the announcement reads.
Senior Vice President for Finance Al Horvath, quoted in the announcement, put it this way:
‘To maintain an affordable health-care plan for all faculty and staff, the university will be introducing some new cost-sharing elements to the Penn State plan that are very common in other employer health plans.’
The planned changes are part of the university’s ongoing effort to control costs, the announcement says. Horvath is quoted as saying Penn State remains ‘committed to maintaining excellent benefits in a time of limited resources.’
But the university ‘simply cannot continue on our present trajectory with health-care costs without bankrupting’ Penn State, Provost Rodney Erickson said in the announcement.
Penn State has already modified retirement health benefits for new employees, giving them health-savings accounts instead of defined-benefit plans. The switch, put into effort on Jan. 1, is projected to save the univesity some $3 billion over the next three decades, Erickson said.
The university is spending more than $180 million on employee health-care benefits this year, according to Penn State. If nothing changes, that figure is expected to reach $206 million by 2011.
‘Every effort has been made to lessen the adverse impact of the economic downturn on our faculty and staff,’ Horvath said in Wednesday’s announcement. ‘Last year, the university froze the monthly employee contribution to health care even though the cost increased by 12 percent.’
Watch StateCollege.com for additional coverage of this emerging issue.
