State says
HSTA overcharged
$2.1 million
for health fund

The teacher union's president
disputes the estimate as unreliable

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By Crystal Kua
ckua@starbulletin.com

State administration officials are still worried that taxpayers and union members may be paying too much for union-run health plans.

State Budget Director Neal Miyahira has pointed to estimates based on information provided by Hawaii State Teacher Health Fund filings that show $2.1 million in annual excess charges for the current fiscal year.

"It's the difference on what they are charging and what they say the costs are," he said. "It appears that they are overcharging."

Miyahira said the excess amount is still unexplained. Even if the amount is for covering costs to administer the plan, it is still too high, he said.

But HSTA President Karen Ginoza said Miyahira's estimates are unreliable.

The teachers union vows to press on with lobbying for union-run health plans during the upcoming campaign season through the next legislative session.

Ginoza said there won't be a renewed push in the waning days of the Legislature this week to ask lawmakers to approve legislation to allow public employee unions to set up voluntary employees beneficiary association (VEBA) trusts.

"We think that's nearly impossible because of the time line, so I think it's going to be really hard," Ginoza said. "We've run out of time, basically."

Ginoza said lawmakers' stance on the union health plan issue will help the union determine whom to endorse for the upcoming elections.

"It's part of our blueprint for public education, and we are taking all that into consideration," Ginoza said.

HSTA has been lobbying state lawmakers, saying it wants to continue running its own health plan because it can do a better, more efficient job than the state. A law passed last year will return the public employee health plan to a single state-run system beginning July 2003.

Teachers were able to convince some of the lawmakers who voted for the health fund measure last year to now vote in favor of the VEBA plan. As a result, the Senate passed a measure this session, but the House -- by a close vote -- opted not to consider the idea this session.

The 2001 law was passed after the legislative auditor said in 1999 that if the state continued to allow unions to provide their own plans, public employees' health insurance would cost taxpayers more than $1 billion a year by 2013.

"We have questions and did ask the Health Fund board to review that," Miyahira said.

Lawmakers have also been critical of union plans being refunded for the overpayment of premiums, partially paid by the state, but not returning the money to the state. For the HSTA plan, that figure has been pegged at a total of $13 million for previous years, Miyahira said.

The state is asking the Health Fund board to determine whether the state may be paying too much for its share of the cost of the health plan, Miyahira said.

Ginoza said that while the HSTA did provide figures on what premiums would cost, the $2.1 million figure is only a projection, based on estimates that came from Miyahira and not the union.

Ginoza said it will not cost the state any more for allowing the union to run its own plan, and she hopes the public, especially during the upcoming political season, will also see that.

"We're not saying we want more than anybody else, but with everybody's money we can get a better plan for our members, and that's based on our track record," she said.

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HSTA
State DOE