1. The Economic Crisis: Health Care Impacts
2009 NCSCBHEP National Conference
April 20, 2009
Presenters:
Scott Sowulewski, Director of Employee Relations, Michigan State University
Maury Koffman, Chairman of Administrative Professional Association at MSU

2. Location: East Lansing, Michigan
About MSU
Location: East Lansing, Michigan
Institution Size: Over 46,000 Students
Faculty: Over 5,000
Support Staff: Over 6,000
Number of Unions: 10

3. Percent Change in Appropriations

4. 12-Year Increases in Higher Education Budgets by State (FY 1997 to FY 2009)
National Average: 67%, or 5.6% per year; Michigan: 17%, or 1.4% per year
In FY 1997 NC & MI had basically same appropriation. Since then, NC has invested an additional $2.0 B into Higher Ed. MI invested an additional $300 M.

5. 50 Year Forecast of Health Care Costs

6. Coalition/MSU Collaborative Approach
The parties agree that the cost of the health care plan and the funding available for wage increases are interrelated
Employer and Union interests are aligned – both are consumers

7. Coalition/MSU Collaborative Approach (cont.)
Promote health & disease prevention initiatives
Agree on “total compensation” cost measures
Improve cost & budgeting predictability
Align Employee/Union and Employer interests to promote payer and consumer partnership
Consider mutual ideas and options to achieve cost savings--Look for incentives to change “behavior”
Strong Union interest to avoid “cost shifting”

8. Coalition Approach to Labor Management Relations
Importance of Coalition access to information
Strive to keep each other informed--“No Surprises”
Importance of education and sharing information
All parties be open to all possibilities
Based on trust – Trust is fragile
Joint effort to solve problems

9. Wage Increases Tied to Health Care Costs

10. Measuring Success

11. Lessons Learned Joint effort in obtaining Administration’s buy-in
Importance of Coalition of Labor Organization’s access to information (from University and vendors)
Importance of education
Allow plenty of time
All parties—be open to possibilities

12. Conclusions
Clearly, many factors affect health care costs, making it difficult to isolate the exact impact of any one strategy or combination of strategies
Collaborative management-labor approaches can yield effective strategies to slow the growth of health care costs
Continued collaboration is an effective strategy to manage growing health care costs while safeguarding the quality of benefits offerings

13. Questions/Discussion