In anticipation of cuts in public funding for benefits received by public employees, Grand Valley State University is altering its employee health care plan.

Under the new plan, GVSU employees—including faculty, staff and even President Thomas Haas—will pay for roughly 20 percent of the total cost of their health insurance. Employees will also choose from three new plan options: a preferred provider organization plan (PPO), an HMO through Priority Health and a high deductible PPO with a health savings account.

“Things change in the medical world, and it caught up with us just like everyone else,” said Scott Richardson, associate vice president of human resources.

Richardson added the university is “putting pressure on all of us to cut our costs.”

Currently, employees pay for about 10 percent of their health care benefits while the university pays the remainder, roughly 90 percent. Until five years ago, employees only paid about 3 percent.

GVSU expects the changes to save more than $38 million during the next five years.

The Benefits Committee designed the plan after bringing in consultants, considering other universities’ plans and discussing the matter with members of faculty and staff governance, who realize ever-decreasing state funding would eventually force universities and their employees into making some concessions.

“We knew changes are coming,” said Donijo Robbins, chair of the Faculty Salary and Budget Committee.

Instead of opposing those changes, Robbins said she and other faculty asked, “Why don’t we get ahead of this and work with the administration?”

Dave Smith, director of the Benefits Committee, said the high deductible plan with a health savings account was a key element to the plan.

Health savings accounts allow employees to save for health expenses on a tax-free basis.

“From a long-term sustainability standpoint, we think that’s the way to go,” Smith said.

If given final approval by the Board of Trustees at its April 30 meeting, the changes will take effect on January 1, 2011.

GVSU is not the only university ahead of the game. Michigan State University, the only remaining Big Ten school still promising newly hired faculty retiree health care benefits, will cease to do so July 1.

Both GVSU’s and MSU’s changes followed actions taken by Gov. Jennifer Granholm and Speaker of the House Andy Dillon.

Dillon, a Democratic candidate for governor, has proposed reducing the amount of taxpayer dollars paying for state employees’ health care and shifting more of the burden on the employees themselves. Neither the House nor the Senate has acted on his proposal.

Granholm introduced reforms in February that seek to remove barriers preventing employees of public entities, including local governments, school districts and universities, from participating in the same health care plans provided to state employees.

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