As a follow up to Q-234/R-003 (November 7, 2011 re: 2012 Qwest Retiree Premiums) and in response to the many, many questions we are getting from the Locals and the retirees, please review the following information. 

How are the premiums determined? 

CenturyLink, like Qwest, is self-insured. Blue Cross and the other Administrators handle and/or process the claims that are then paid by the company based on the provisions of the negotiated Plan(s). 

What portion of the costs are borne by the company and what portion is borne by the active employees and retirees is determined in bargaining.  

Actual costs vary depending on which “pool” you look at. For example, pre-Medicare eligible represented retirees are in a different “pool” than the Medicare eligible retirees. Then there is the “pool” of the pre-1991/ERO retirees which are separate from everything else. Then there is the active represented employee “pool” and the non-represented “pool”. 

The actual costs for each “pool”, minus the negotiated employer contributions, are then used to determine the premiums for the following year. 

Historically, for the past 20 years, the contractual Health and Wellness Advisory Committee goes over the previous year’s costs as part of the pre-enrollment review process to ensure there are no disputes.  

In short, until CenturyLink came into the picture, we had complete transparency. 

This review for 2012 Open Enrollment was to have begun at the HWAC’s September 2011 meeting in Vancouver, WA. During that meeting, it became apparent that CenturyLink was unaware of and unprepared to meet their contractual obligations regarding this process. Despite repeated commitments toward transparency, no information was provided including the rates they ultimately published for 2012 open enrollment. 

What does the contract say regarding retiree healthcare?Retiree healthcare is subject to 2 provisions of the current contract: Addendum 10 – Benefits and the Retiree Healthcare Letter of Agreement (attached). 

Addendum 10 addresses General Plan Matters and Benefit Plan Grievance and Arbitration and describes the process to be used in the issue of disputes. Since it is subject to the grievance and arbitration procedure, the Letter of Agreement RE: Permissible Mobilization Activities Over Grievable Issues applies. 

The Retiree Healthcare Letter of Agreement is what determines healthcare and who pays for what for those who retire(d) on or after January 1, 1991. Without this letter, CenturyLink would have kicked our Medicare eligible retirees to the curb at the same time they kicked the non-represented retirees to the curb. 

While CenturyLink has no legal obligation to bargain for the already retired, the Retiree Healthcare Letter of Agreement addresses Retiree Healthcare on a going- forward basis and ties it to the negotiated Plan for active represented employees. 

Our dispute is “that no change shall be made without the consent of the Union in the Plans which would reduce or diminish the benefits or privileges thereunder for the employees within the bargaining unit.” 

“Any claim that the duty to give notice or to offer to bargain has been violated, or that a change in the Plans has resulted in such benefits or privileges being diminished or reduced, may be taken up as a grievance and, if necessary, submitted to arbitration, in accordance with Article 16 of this Agreement.  In any such case, the terms of any proposed change in the Plans shall not be subject to arbitration, and any decision or action of the Company shall be controlling, unless shown to have been arbitrary or in bad faith, and only the question of bad faith or arbitrary action shall be subject to the grievance procedure or arbitration.” (Section A10.4) 

As outlined in Addendum 10, CWA has challenged these actions as changes which "reduce or diminish" the negotiated benefits through actions CWA regards as "arbitrary and in bad faith". 

Until we've actually reviewed all the data with our actuary, none of us can actually understand, let alone explain, where these current rates came from or what they're based on. 

Opt-In or Opt-Out? 

The most asked question we’ve received is whether a retiree could opt out in 2012 and opt back in to the Qwest Retiree Plan the following year. That answer is yes.

If the premiums change after open enrollment, can I change my option? 

The second most asked question is whether employees or retirees could later change their option if the employer is found to be wrong in its determination of the premiums. That answer is no. Once you’ve made your choice, you are locked in for that Plan year. Considering CenturyLink's posture, we do not believe that they will change course until and unless they are compelled to, so the odds of this being resolved within the next few weeks are not likely.

Attachment  

RWR:vk opeiu5/ afl-cio

c:     District 7 RMC
        Staff