WGA to reduce benefits again

Group narrows eligibility, boosts costs

The Writers Guild of America West has disclosed a second round of tightened benefits and cost hikes in its health insurance plan, mirroring similar moves by other Hollywood unions in recent months.

“This year all the creative guilds have brought troubling news to their members about their health insurance costs,” said WGAW prexy Victoria Riskin in the latest newsletter to members. “We are no exception.”

Key among the upcoming moves — which go into effect July 1 — will be a 51% jump in the eligibility requirement for annual earnings to $28,833 from $19,125. Riskin had warned earlier this year that a hike in eligibility was under consideration, but she had not disclosed specifics.

The new requirement equals the minimum pay for a one-hour network primetime story and teleplay; the previous figure represents the minimum for a half-hour network primetime story and teleplay. Under the new requirements, writers who have reached the $19,125 eligibility level as of June 30 for earnings during the previous 12 months will have their coverage continued, but they must reach the $28,833 level on Sept. 30 to maintain coverage.

Quarter to lose coverage

The hike in eligibility will mean about 2,200 of the 8,800 WGAW members will not qualify for coverage. For the fiscal year ended June 2002, top earnings for the lowest paid 25% of the guild were $28,091.

The plan has told members the higher eligibility level is still far short of the $116,000 in earnings required to offset the average annual cost per participant. “It is consonant with the fund’s commitment to extend coverage to as many writers as possible,” it noted.

Other changes include the first-time imposition of a premium for dependent coverage, set at $50 per month per family; no Medicare Part B reimbursement, vs. the current $58.70 per month; first-time imposition of an emergency room co-pay, set at $50; elimination of the infertility treatment benefit; and elimination of retail coverage of maintenance medication.

“Although the cuts in benefits are significant, we still have one of the best benefit plans in the country,” Riskin said.

The WGA announced the first round of cuts in January and implemented those at the start of April for the plan, operated jointly by reps of the WGA and the Alliance of Motion Picture & Television Producers. Riskin blamed the downturn in the economy and stock market; cutbacks in Medicare that have shifted more of the burden to private insurance; and the dramatic escalation in health care costs.

Costs overtake earnings

“For the first time in years, the health plan’s expenses are exceeding income from the contributions made by the companies based upon writers’ earnings,” Riskin said at the time. And she noted the plan trustees have transferred funds held in savings to the general fund to help cover this year’s deficits.

The first round of cuts raised the deductible from $200 per individual and $600 per family to $300 and $900, respectively; boosted the co-pay for prescription drugs; cut reimbursement for eye exams and glasses from $325 per year to $200; and reduced lifetime coverage on the infertility benefit from $25,000 to $5,000.

Riskin has also warned that the AMPTP companies should be prepared to boost their contribution when the next contract negotiations begin. Company contributions are bargained as part of the WGA’s Minimum Basic Agreement, which expires in May 2004.

No date has been set for those negotiations, but the first town hall meeting for members to discuss those issues will be held Tuesday.

Soaring health care costs have forced SAG and AFTRA to impose their first health plan premiums this year, along with tightened benefits. The DGA has announced its plan faces an $8 million deficit this year and will be forced to reduce benefits, and IATSE negotiated higher AMPTP contributions in its three-year West Coast contract along with health plan changes designed to save $54 million over three years.

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