Union sues school district over health care costs

Thursday, Feb. 5, 2004 | 9:13 a.m.

The union representing the Clark County School District's support employees has filed a lawsuit alleging the district hasn't complied with an earlier order to turn over data related to its health insurance plan.

In May 2003, while negotiating a new contract, the NSEA filed a complaint with the Nevada Local Employee Management Relations Board, claiming the school district was not turning over the requested information. The board ruled in favor of the union and ordered the district to furnish "reasonable information" related to the contract negotiations.

The district has since provided only skimpy details and not the comprehensive accounting the union is seeking, said Joe Furtado, executive director of the Education Support Employees Association.

In a suit filed in District Court in December the ESEA asks for details of billed charges, discounts, co-payments, hospital stays, professional services and prescription drugs related to the Health Plan of Nevada's coverage of its members.

After the board's ruling, the school district contacted Health Plan of Nevada and asked the company to furnish the data requested by the union, Bill Hoffman, the district's lawyer, said. The health insurance company responded that much of the requested data would not be released because it was proprietary and confidential, Hoffman said.

"We have complied exactly with the order and given everything we had to give," Hoffman said Wednesday. "(The ESEA's) argument is that we have information that we have somehow chosen not to provide, and that is not true. There is no strategical or tactical reason for us to withhold this information if we had it."

Hoffman said he plans to file a motion to have the ESEA's suit dismissed.

Following the collapse of the ESEA's health trust in 2000, the school district decided to use a private carrier to provide coverage to the support employees and chose Health Plan of Nevada.

Health Plan of Nevada last year received $24 million to provide coverage to the ESEA's 8,900 members and dependents. Some of the money came from employee premiums but the bulk was from the district, Furtado said.

"Every month the school district sends a big check to (Health Plan of Nevada) and has no idea what happens to the money," Furtado said. "We don't think that's in the best interest of the employees we represent, the school district or the taxpayers."

With the district scheduled to begin increasing its contributions to employee health care funds in July, the union is anxious to shop for a better deal than offered by Health Plan of Nevada, Furtado said. The union needs the specific data in order to evaluate bids from other health care providers, Furtado said.

Health Plan of Nevada may be resisting providing the data in order to hamper the union's search for another insurance provider, Furtado said.

A spokeswoman for Sierra Health, the parent company of Health Plan of Nevada, said she could not comment on the ESEA's suit or any matters related to the company's contract with the district.

There is nothing in the district's contract with Health Plan of Nevada that requires the company to hand over any data as to the specifics of its business practices, said Edward Goldman, associate superintendent of alternative education and a member of the district's negotiating team.

"We don't have custody or control of those records," Goldman said. "We pay them a fee, they provide the services. Our agreement says the co-pay for generic drug prescriptions is going to be $3. We don't really care if it cost (Health Plan of Nevada) two dollars or 20 dollars, provided they live up to the contract."

The requested information is neither proprietary nor confidential, Furtado said. At the board hearing Terry Van Noy, a management consultant hired by the union to serve as an expert witness, testified that similar information is routinely provided to policyholders as a way of tracking how money is being spent.

If the contract involved a private company rather than the school district, Health Plan of Nevada would be required by federal law to provide the information to the union, Van Noy said Wednesday.

The fact that the district did not have a requirement in its contract for specific data is unusual, Van Noy said.

"It would be problematic for someone to effectively manage their dollars, especially an account in excess of $20 million, without that information," Van Noy said.

Before extending the health plan's contract with the district a provision should be added requiring the company to furnish the specific data the union is seeking, Furtado said.

Goldman said he wouldn't have a problem with trying to add such language to the next contract that would specify such data be made available but doubted Health Plan of Nevada -- or any insurance provider -- would agree to the terms.

"Why would any private company release proprietary or trade information?" Goldman said. "We certainly can't force them."