New UAW Contract Downgrades Members' Health Coverage

Frank Williams
by Frank Williams
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new uaw contract downgrades members health coverage

Under the new UAW-GM contract, workers' health care will be funded by large-scale investments in Japanese automakers and their suppliers. Just kidding (I think). But the union's rank and file may find changes in their health care coverage equally palatable. The Detroit Free Press reports that the UAW's leadership has agreed to cutback on the number of health care plans offered and the number of providers the plans will covers. But wait, there's less! They'll also raise copays (a bone of contention in '05) and eliminate all dental HMOs. Under the only PPO on offer, union member's family get five "free" doctor visits a year with a $25 copay for each visit. Surprisingly, the UAW leadership is downplaying the changes; they aren't mentioned during the 30-minute "information" meetings before the contract vote. One unforeseen (and so far unmentioned) ramification of ratification: it could trigger an exodus of medical talent from the Detroit area. But that's OK. GM's going to spend $15m to create a National Institute for Health Care Reform to "study solutions to national health care woes." That should make UAW members feel better… eventually.

Frank Williams
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  • Ralph SS Ralph SS on Oct 05, 2007

    So...just wondering aloud here. Since the auto industry is still one of our (USA) largest, does this arrangement represent a model of how health care will be managed in the future for the rest of blue collar America? Since they (the auto industry) have always been a leader in wages and benefits for the working class, will other companies and their employees emulate this? Will this result in pseudo-unions being developed to administer health care for employees in other companies/industries? Will union membership increase out of necessity?

  • Yankinwaoz Yankinwaoz on Oct 05, 2007
    Will this result in pseudo-unions being developed to administer health care for employees in other companies/industries? I can see companies reducing their involvement into health care coverage even more by simply making cash contributions to member controlled VEBA. That make the VEBA itself responsible for managing health care costs. This would be very similar to what has happened to pensions. There are almost no private company pensions. Instead, there are defined contribution user controlled retirement accounts such as 401k's. I do not think there will be, or need to be, any union memberships to get access to a VEBA. I think that you will be able to shop, compare, and subscribe with premiums and company contributions.
  • Stuntnun Stuntnun on Oct 07, 2007

    i think they must be guessing Hillary will be president soon so she can give them "free"(cough) health care--im sure the unions one of her major campaign contributors