NY POLITICS Updated June 10, 2012, 10:44 p.m. ET
Union Fund Gets Another Albany Assist
By JACOB GERSHMAN
The troubled insurance fund for 1199SEIU United Healthcare Workers East's personal-care workers will get a $70 million government bailout this year under a deal struck in Albany, the second taxpayer assist in less than a year for the powerful union's employee benefits fund.
Gov. Andrew Cuomo consented recently to prop up the union fund with about $50 million in Medicaid funding. The state Assembly—where lawmakers are closely allied with labor—pitched in with another $10 million drawn from a discretionary pool of Medicaid cash and disclosed in the budget. The Assembly contribution triggered a $10 million federal match.
Mr. Cuomo's deal was struck outside the normal budgeting process and didn't require legislative approval.
The 1199SEIU fund provides medical, prescription drug, dental and vision benefits to about 30,000 personal care aides who work at agencies under contract with the New York City Human Resources Administration. The aides are paid hourly rates to help elderly and infirm Medicaid patients with chores, groceries and bathing.
The fund had about $22 million at the end of 2010, according to federal records.
The fund received a $50 million bailout last year, and the union warned that, without another round of subsidies, it would have to charge its unionized personal-care aides higher premiums, driving thousands of them out of coverage.
The governor's office said the assistance won't become a permanent state subsidy. Cuomo health officials said the subsidies would eventually phase out, as workers qualify for federally subsidized medical insurance under President Barack Obama's health-care overhaul.
Matt Wing, a spokesman for Mr. Cuomo, said: "This is a continuation of last year's allocation and serves only as a temporary bridge until the implemented health exchange can provide subsidized coverage, ensuring that people who depend on home attendants are not at risk of losing their caregiver."
Cuomo officials said they paid for the bailout the same way they financed it last year, tapping unspent cash from a pool of Medicaid already earmarked by the state Legislature for "worker recruitment and retention."
The bailout cash flows to union workers through higher Medicaid reimbursement rates. Last year, the Cuomo administration's deal with the 1199SEIU hit a snag when senior Bloomberg officials, including the city's Human Resources Administration commissioner, Robert Doar, and the deputy mayor for health and human services, Linda Gibbs, refused to recommend a rate increase.
The state Department of Health went ahead with the rate increase anyway.
1199SEIU's benefit fund has long had financial trouble. From January 2009 to January 2011, it spent $9 million more than it took in, according to federal records. Until recently, the fund had been managed by a private Medicaid managed-care company.
The union assumed control of its operations last year and has said it is doing a better job of controlling costs.
Under the Cuomo administration, 1199SEIU has won a number of important victories, while the governor's health-care team has squeezed other sectors of Medicaid, particularly home-care companies. The governor's budget last year included a wage mandate targeted at home-care companies who employ lower-paid home-health aides—who are similar to personal-care aides but also perform skilled nursing and therapeutic services—many of whom aren't unionized.
The mandate imposed New York City wage laws on a broad swath of workers, effectively forcing those companies to pay their workers what personal-care aides get under their collective bargaining contracts.
A similar wage floor was imposed on companies in Nassau, Suffolk and Westchester, but that kicks in a year later, in 2013.
It was crucial victory for 1199SEIU to prevent a flood of cases flowing to a lower-wage market as the state shifted to managed long-term care. The union argued that higher wages would improve care by reducing turnover. The bailout shields personal-care aides from further cuts to their plans. They still can qualify for coverage by working as little as 80 hours a month. In comparison, home-health aides typically have to work at least 120 hours a month.
http://online.wsj.com/article/SB1000...454248068.html
Originally Posted by Flixy
That sounds weird, the incumbent can get unlimited donations and the challenger can't?Who ever thought that was a good idea?
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