For Many Employees, Health Benefits Premiums Will Rise in 2017

Many of Harvard’s employees and faculty will see an average 7 percent hike in their healthcare premium costs in 2017, but the University will at the same time offer slightly reduced premiums for its lowest-paid nonunion workers.

Citing “an increase in medical claims and prescription drug costs, especially specialty drugs,” Harvard announced Wednesday that premium costs will, on average, increase for the second year in a row; premiums jumped 7.3 percent last year. For some Harvard employees earning less than $55,000 per year, though, the premium cost will be mitigated by the creation of a new salary tier with lower premiums effective Jan. 1, 2017.

Harvard is extending the new tier to nonunion employees almost a year after a similar plan developed through prolonged, tense negotiations between Harvard’s largest union—the Harvard Union of Clerical and Technical Workers—and the University.

Now, nonunion employees like postdoctoral students at Harvard will benefit from a healthcare payment structure similar to the one HUCTW negotiated. The HUCTW plan eliminates deductibles—the amount a person has to pay out of pocket before their insurance company will pay a claim—on the grounds that it would substantially raise copayments.

In recent years, healthcare benefits have been at the center of faculty and union protest. Harvard clashed with faculty in late 2014 over the restructuring of its insurance options effective January 2015. After the University introduced an out-of-pocket deductible and coinsurance to cut costs, nonunion faculty and staff pressured administrators into offering an additional plan without deductibles or coinsurance.

More recently, Harvard has faced backlash for its healthcare offerings from UNITE HERE Local 26, the Boston-based union that represents Harvard University Dining Services employees. The union has repeatedly cited the health care plans Harvard has proposed to them as a major impetus for the historic strike they launched Wednesday morning.

Harvard’s currently-striking dining hall workers are still negotiating health benefits options with the University. When Harvard proposed a four-tiered plan identical to the one negotiated with HUCTW to the HUDS union Local 26, the union rejected the plan.

Harvard will also eliminate one health care plan option for nonunion employees and some union employees. Out of state employees will no longer be able to enroll in the Preferred Provider Organization program, which allows employees to “go to any health care professional [they] choose inside or outside [their] network.” Participants in this program will be automatically re-enrolled in Harvard Pilgrim Health Care plan of service unless otherwise requested.

While largely similar in scope to the 2016 plans, the 2017 insurance options will include an acupuncture benefit for all employees. Harvard will mail a guide to the plans to eligible employees next week and roll out an online comparative tool. The sign-up period for the new plans will run from Nov. 2 to 16.

—Staff writer Andrew M. Duehren can be reached at andy.duehren@thecrimson.com. Follow him on Twitter @aduehren.

—Staff writer Daphne C. Thompson can be reached at daphne.thompson@thecrimson.com. Follow her on Twitter @daphnectho.