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Teachers' health plan info doesn't square; and yes, teachers are severely underpaid

"alf", I checked the human resources section of the Santa Cruz City Schools Web site. It reveals no drastic changes in the scope of the teachers' health insurance plans in the past few years.

The teachers can choose from Blue Cross Prudent Buyer I or II or Health Net. In most cases the premiums are paid entirely by the School District. Neither Blue Cross nor Health Net excludes "cancer and a few other horrible dseases". Such an exclusion is unheard of in the group health insurance industry.

The dispute this year is over who should cover the increase in premiums. I don't have exact figures for the District's specific health plans (these vary from employer to employer), but CalPERS contracts with Blue Cross for very similar plans and has had annual premium growth in the 10 to 20% range for several years. According to the Sentinel, the District has offered to pay 70% of this year's premium increase, leaving the employees to pay 30%.

Hypothetical example: Imagine that the monthly premium for HMO coverage is now $300 for one employee. This is paid entirely by the District. Imagine that the increase is 15% = $45. The District has offered to pay 70% of this = $31.50. The employee would pay $13.50. Summary: District will pay $331.50 per month, employee will pay $13.50 per month.

Many people do not realize that the Consumer Price Index includes healthcare costs; even employer-paid premiums are accounted for. If the teachers wish the District to cover the full premium increase this year, then they should accept a COLA that is in-line with CPI minus the healthcare component. (Note: the CPI is available on a local basis, so the high cost of living in Santa Cruz County, or rather, in the greater San Francisco Bay Area in general, is considered.)

Fair COLA for 2004 in Santa Cruz, based on local CPI data:
1. If employer also eats 100% of the health insurance premium increase - 1.16%
2. If employees eat 100% of the health insurance premium increase - 1.40%
Since the employer has proposed to eat 70% of the premium increase, the fair figure lies in between. I calculated 1.23%

As I said in the case of Safeway, if the total compensation paid to an employee group (wages + benefits) rises in-line with the CPI, the employees aren't losing ground economically. There is nothing special about health insurance: it's one of the many expenses included in the Consumer Price Index, and so, one of the many expenses that can be covered under a reasonable cost-of-living allowance (COLA).

When we assess total compensation for teachers, other issues do come up. For example: Has teacher pay kept pace with the CPI on a historical basis? (Cautious yes, cautious because wages have been stagnant recently.) Is the vast -- up to $34K -- pay gap between junior and senior teachers fair? (Definitely no, if you believe in equal pay for work of equal value. As in the case of Safeway, teachers' unions favor their senior members and devalue their junior ones.) Is the BASE wage (the starting point, before we even get to COLAs) reasonable, given teachers' high level of education and the great importance of their work? (A resounding no. At $51K after 10 years, a Santa Cruz public school teacher earns less than a Metro bus driver. The teacher spent 6 years at university to complete her certification, at her own expense. The teacher is required to attend continuing education classes throughout her working life, again at her own expense. The driver completed her commercial drivers' license training at Metro, all expenses paid. The physical exams and license renewals that she must complete throughout her career are likewise paid for by Metro. As for holidays -- people always accuse teachers of having too much time off -- the Metro driver receives 30.5 vacation days, 8 holidays, and 12 sick days (convertible to cash at retirement) for a total of 10 weeks off with pay each year. A teacher receives about the same amount, and doesn't even have her summers free anymore, with the new continuing education requirements. Note: I don't want to single out bus drivers. I could make some shockingly similar comparisons for senior Safeway clerks, line civil servants, auto workers, and others. Any way you slice it, either teachers are underpaid or many unskilled/semi-skilled employees are overpaid. I use the term "unskilled/semi-skilled" in an economic sense, not in a pejorative one.)

Clearly, teachers -- and especially junior teachers -- deserve a substantially higher BASE wage. Dickering over a 1% COLA and/or a few dollars a month in health insurance premiums is not the answer to recognizing the work that teachers do.
 


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