Hollywood actors will begin receiving upbeat news next week about their health plan — a marked contrast from the negative developments of recent years.
Trustees of the SAG Health Plan are due to announce elimination of a scheduled 5% hike in eligibility requirements, lowered eligibility for thesps over 40, improved benefits in the dental plan and easier access for performers covered by AFTRA’s plan. The 41,000 or so participants in the SAG plan will receive details of the changes through the plan’s Take 2 newsletter.
The moves come three years after trustees of the plan — jointly administered by reps of SAG and the Hollywood studios — were forced by skyrocketing medical costs to announce first-ever premiums plus another round of tightened eligibility floors and benefit reductions following the initial announcement in August 2001.
“In 2003, when the plan faced a major deficit that threatened its very existence, the trustees instituted a three-part plan: the participant premium, the eligibility escalator and a reduction in benefits,” the plan told participants. “While we still face double-digit increases in the cost of health care, the plan’s finances have stabilized.”
The improvements in finances also came from heightened employer contributions to the plan. Last year’s 1% hike in health and pension contributions through the film-TV pact increased revenues by an estimated $60 million over the contract’s three-year life.
Plan currently covers about 17,000 active earners, 5,500 retirees, 2,500 self-pay participants and 16,000 dependents. Participation has fallen by about 10,000 since the 2003 changes, with most of those opting out due to access to alternative coverage.
Trustees highlighted the lowered eligibility for thesps over 40, which drops the Plan II eligibility level from $13,790 in the four previous quarters to $10,000 in that period — if they’ve accumulated 10 years of eligibilty. The 10 years do not need to be consecutive.
“The trustees wanted to target the changes in eligibility where they would do the most good,” CEO Bruce Dow told Daily Variety. “Older actors who lose eligibility in this plan also face a significantly higher premium if they have to purchase private insurance.”
Other key changes going into effect next year include the following:
- Previously scheduled 5% hikes in the eligibility levels for Plan I (currently at $28,120 in earnings in the four previous quarters) and Plan II (currently at $13,790 or 74 days of employment) have been eliminated.
- The trustees have set a target of 3% annual hikes in eligibility but will not make that automatic for 2008, pending a decision next July.
- Dental benefits will be increased, with the annual maximum rising to $2,500 from $1,500 under Plan I and to $1,000 from $500 under Plan II.
- The SAG plan will act as the primary plan for covered participants who opt out of AFTRA’s health plan next year, when major hikes in eligibility and benefit cuts go into effect. 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 for the lowest tier of heath-care coverage.