Stanford Report, July 12, 2006

Change considered for health benefits

Employees with total family income of less than $45,000 could receive free health-care coverage for themselves and dependents

Under a new benefit being considered by Stanford officials, university employees whose total family income is less than $45,000 could receive free health-care coverage for both themselves and their dependents beginning in 2007.

In the next several weeks, university officials will be seeking employee reaction to the contemplated new benefit through both formal meetings and informal mechanisms. Bargaining unit employees might also be eligible, depending on discussions with their union during negotiations this summer.

If approved, the new health-care benefits would begin Jan. 1, 2007, when benefits chosen as part of the university's annual fall enrollment become effective. The cumulative changes could affect as many as 4,500 employees based on Stanford salaries, although once total family incomes are factored in, the number is likely to be smaller.

To be eligible for the possible new benefit, an employee would have to be full-time and already eligible for benefits. Employees also would have to provide documentation substantiating their family income.

Currently, Stanford offers six different health-care plans. All employees who choose employee-only coverage with the lowest-cost option, which has been Kaiser Permanente for the past few years, already receive their healthcare for free. In addition, the university has paid an amount equal to 82 percent of the lowest-cost option toward the cost of healthcare for dependent coverage groups. Employees who do not select the lowest-cost plan receive the equivalent contribution toward whatever plan they choose and then pay the difference themselves.

The possible new offering would extend free coverage for all dependent-coverage groups to those employees whose family income is less than $45,000 and who choose the lowest-cost plan. In addition, Stanford officials are considering creating a graduated system of additional subsidies.

"Our already excellent health-care benefits recognize the value of the services provided by each and every Stanford employee to the university's research and teaching mission," said Diane Peck, executive director of human resources.

"Earlier this year, we participated in a survey of 20 of the best-known Bay Area organizations, including Intel, Cisco, Genentech, Apple, eBay, Oracle, Gap, Wells Fargo and many others, and were pleased to learn that Stanford is near the very top in terms of the value of our total benefits package," Peck said. "Despite our benefits package, we recognize that some of our employees continue to have difficulty affording healthcare for themselves and their families."

She added, "Many of our families are feeling tremendous pressure because of the ever-increasing cost of healthcare and cost of living in the Bay Area. Through this contemplated new health-care assistance plan, we hope to be able to alleviate some of that pressure."

Comments about the new benefit being considered can be sent to newbenefit@lists.stanford.edu.