Insurance breaks for UMC workers stopped

Adrienne Packer

Friday, Jan. 25, 2002 | 11:06 a.m.

University Medical Center waived co-payments for its employees against county policy for the last decade in a move that cost the county hospital hundreds of thousands of dollars, officials said.

All other Clark County employees are responsible for co-payments at the hospital, but the fees for UMC workers enrolled in the Self-Funded Medical Program have been waived the past 20 years, Finance Director George Stevens said.

Stevens said there is no way to determine the losses to the hospital's general fund coffers because both the cost of co-payments and the number of employees at UMC have increased over the years.

In calendar year 2001, however, Stevens said 2,257 hospital employees were enrolled in the program. He estimated the hospital lost about $100,000 in funds that would have been used to help cover the cost of operating the facility.

"It was likely less every year prior to that because there were fewer people enrolled and the cost of health care was less," Stevens said.

Co-payments for all county employees were waived in the early 1980s, when the county was enrolled in a commercial plan. A decade later, the county began its self-funded plan, under which all employees were required to pay the fee.

But the hospital never stopped the practice.

The special treatment of hospital workers was reported to the county's risk management division late last year. A December memo written to UMC Chief Executive William Hale warned him to cease waiving co-payments to hospital employees who use UMC services.

"This practice not only provides the employees of UMC with a much richer benefit, but is in direct violation of the provisions of the (Clark County Self Funded Medical Program)," Risk Management Director Robert Mulroy wrote.

Hale did not return a phone message Thursday, but a prepared statement said the hospital offered 15 percent discounts to employees and, as of Jan. 15, the offer was discontinued.

The statement said the discounts were first offered in July 1981 "based upon the hospital's desire to achieve maximum utilization of its facility and services, and to assist in reducing the costs of hospital services offered by the hospital to all employees and dependents."

Assistant County Manager Mike Alastuey, who looked into the exemptions, confirmed that UMC has modified its policy.

"UMC over time had waived co-payments for their employees as a gesture to the employees," Alastuey said. "The plan we have now is that everyone must comply; participation is required on the part of all members."

Commission Chair Dario Herrera was unaware of the UMC discounts and was shocked the practice continued for so long.

"I'm surprised to hear that was a practice at UMC and I'm glad to hear the county administration has taken steps to ensure all county employees are treated equally," he said.

Co-payments -- the out-of-pocket expense for insured patients -- usually run in the neighborhood of $20 for outpatient services, or about 20 percent of the medical bill for inpatient treatment, officials said.

Skip Moskey, community director for the Washington-based National Association of Public Hospitals and Health Systems, said it is not unusual for hospitals, like any other business, to offer incentives in their insurance packages.

"Generally we say that any employer, regardless of the nature of the work, has to find ways to attract and retain a work force," Moskey said. "That's a routine part of a benefit package not specific to a public hospital."

Valley Health System, which operates three hospitals in the Las Vegas Valley, offers a 50 percent discount to its employees for in-house medical services, said spokesman Mike Tymczn.

UMC's ability to waive co-pays for its employees was "certainly an attractive benefit to offer in a tight job market," said Bill Welch, president of the Nevada Hospital Association.

"With the severity of today's nursing shortage, hospitals are finding themselves doing everything they can to attract employees," Welch said.

Allan Stipe, president of Sunrise Hospital, a private facility, in the past offered similar perks and echoed other hospital executives in stressing the importance of attractive benefit plans to retain employees.

Oftentimes, he said, it becomes more expensive not to offer such incentives, as employees will seek treatment at competing facilities.