In a reflection of soaring costs, AFTRA’s health plan will boost premiums and earnings requirements starting next year as part of a revamp of the coverage structure into four tiers.
The most notable change calls for AFTRA’s four-quarter earnings minimum to jump from the current $10,000 to $15,000 as of July 1, 2007, for the lowest tier of heath-care coverage. The earnings requirements will be increased by 2.75% annually into 2010.
Quarterly premiums — the lowest of which is currently $300 — will rise by 5% annually for four years starting Jan. 1.
Trustees of AFTRA’s health plan, which covers about 16,000 members, retirees and dependents, were forced to make similar moves in 2003 to deal with cost hikes.
They said in a recent letter to participants, “Although the trustees have been required to make difficult changes to the AFTRA Health Plan, the changes to date have succeeded in stabilizing the plan, thereby allowing the trustees to take more measured steps to position the health plan to better weather the anticipated skyrocketing health-care inflation in future years.”
In the letter, the trustees also said the changes came in response to participants’ desire for a tiered coverage structure along with gradual increases in premiums and eligibility.
AFTRA’s lowest “core” coverage tier includes wellness benefits and catastrophic coverage only for individual medical and hospital benefits. There’s no coverage for dependents, life insurance, prescription drugs, dental, accidental death or dismemberment and loss of voice.
Union’s other coverage levels will include a “basic” tier for members earning between $25,000 and $60,000 in four consecutive quarters; a standard plan for earnings between $60,000 and $100,000; and an enhanced plan for those with earnings over $100,000.
AFTRA began charging its first-ever health premium of $250 per quarter in 2003, along with a quarterly charge of $225 per partner and $120 per child. It also bumped the four-quarter earnings qualification to $10,000 from $7,500.
All showbiz unions were forced in 2002 and 2003 to cut benefits and boost eligibility due to increased costs. All the plans are jointly administered by reps of the respective unions and the studios and networks.