January 27, 2003

Baylor Health Care retirees publish
complaints; system defends its decision
___By Marv Knox
___Editor
___DALLAS--Some retired employees of Baylor Health Care System have published an ad in the Dallas Morning News to protest a reduction in their life insurance benefits.
___An officer of the Dallas-based system responded that the move was necessary to offset rising costs and noted the retirees still receive a benefit offered by few hospitals.
___The Associated Retired Employees of Baylor Health Care System purchased a half-page ad in the Dallas newspaper's Jan. 21 edition. The ad was presented as an "open letter to the Baylor Health Care System board of trustees."
___The ad said retirees "were stunned when BHCS recently slashed the life insurance benefit formally awarded us when we retired." Premiums for the retiree life insurance plan, which dates to 1951, were to be paid by Baylor "for life," retirees contend.
___The retirees learned of the policy change last November, and it took effect Dec. 31, the ad said. Insurance policies now are limited to $50,000 rather than the previous $100,000, and retirees must pay 30 percent of their premiums.
___The retirees acknowledged that health-care institutions face budget challenges. "What we don't understand is how BHCS' financial condition justifies such harsh tactics to achieve small savings toward a $1.5 billion annual budget," the ad said, criticizing "seemingly frivolous spending."
___The open letter asked the BHCS board of directors to intervene on the retirees' behalf.
___The board of directors already approved the policy decision as part of a larger cost-cutting measure, responded Jennifer Coleman, the system's senior vice president for consumer affairs.
___"These cost cuts were necessary because of huge challenges in health care, impacting not only Baylor but many hospitals," Coleman said. "These challenges include higher labor costs due to the nursing shortage; skyrocketing professional liability insurance costs; shortfalls in reimbursement; and a rising number of uninsured patients, who don't pay for the care they receive."
___The retiree life insurance policy change resulted in a savings of $7.4 million, and the value of the decision is expected to increase over time, she said.
___The cost savings "will be applied to patient care, the needs of the uninsured and to our mission of health care, research and community service," she added.
___Many industries and almost all hospitals discontinued providing paid life insurance benefits for retirees years ago, Coleman reported.
___BHCS will continue to subsidize 70 percent of premiums for retirees who were in the life insurance program, Coleman said, noting 353 retirees participate in the life insurance program.
___The 70 percent subsidy is a higher rate than Baylor provides for current employees, she said.
___"We're saddened that they don't appreciate that we've tried to take care of them while we are continuing to be good stewards for Baylor Health Care System," said Linda Carter, BHCS board chairwoman.
___About 25 to 40 retirees are part of the Associated Retired Employees of Baylor Health Care System, said Chairman Robert Paul of Tyler.

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