Employer News - Spring 2010

1199 SEIU Employer News Spring 2010_Layout 1 3/31/10 8:52 AM Page 1

1199SEIU Funds 330 West 42nd Street New York, NY 10036-6977

Non-Profit U.S. Postage PAID New York, NY Permit No. 3700

Spring 2010

Members Find it Easier to Apply for Child Care Benefits The Child Care Fund is committed to making sure every eligible 1199SEIU member is able to register for the child care benefits that your contributions support. Recognizing that 1199SEIU parents are already juggling work, child care and other responsibilities, the Fund has turned its focus in the past year to making the registration process as simple and convenient as possible. As a result, more than 14,000 1199SEIU members were able to apply for child care benefits during the 2010 registration period this past fall.

IN THIS ISSUE . . .

As contributing employers, you already know about the work our Funds are doing every day to support your 1199SEIU employees with comprehensive benefits in the most cost-effective way. In this issue of 1199SEIU Employer News, you will read about how our programs are making a difference not only to our members, but throughout the healthcare industry.

Pharmacy Innovation Award Recognizes National Benefit Fund’s Creative Cost Containment Strategies . . . . . . . 2

After many years of successful cost containment initiatives, the National Benefit Fund has been recognized with a national award for our innovative prescription programs – programs that are helping us reach our mandate to save an additional $150 million over the next five years.The Training and Employment Funds are partnering in a new national initiative supported by the U.S. Department of Labor to prepare healthcare workers and our institutions for the green jobs of tomorrow. Meanwhile, our Child Care Fund has been hard at work streamlining its registration process to enable a record number of members to register for child care benefits in 2010.

Together, we are working to improve members’ lives and support the efforts of our healthcare industry, and we hope you enjoy this issue of your Employer News.

As in past years, the Fund offered in-person registration for members at sites across New York City and in upstate New York, with extended hours to accommodate working parents’ schedules. Members visiting our Manhattan and Hicksville, Long Island, offices had the option of seeing a registration clerk, or registering online at computer terminals under the guidance of a staff person. While the majority of members registering in person visited the Fund’s Manhattan office, more than 1,000 parents came in to register for benefits at the Hicksville site. The Fund’s own staff was supported by 34 1199SEIU parents who serve on the Child Care Fund’s Advisory Committee and were on hand to help their fellow members through the process.

Since we understand that it can be difficult for 1199SEIU members to get to a registration site in person, the Fund also focused on improving the online registration process. Fund staff created an updated version of the online registration tutorial, which guides members through the process step by step, from start to finish, and created an extended and more detailed instruction manual that members can download and print for their convenience. Finally, the Fund

FROM THE EXECUTIVE DIRECTORS

Sincerely,

Mitra Behroozi Executive Director Benefit and Pension Funds

Deborah King Executive Director Training and Employment Funds

Vivian Fox Executive Director Child Care Funds

New Prescription Initiatives Bring National Benefit Fund Closer to Cost Containment Target . . . . . . . . . . . . . . . . . . . . 2 Training And Employment Funds Train Environmental Workers for Tomorrow’s Green Careers . . . . . . . . . . . . . . 3 Training Fund Conference Prepares Institutions to “Go Green” . . . . . . . . . . . . . . . . 3 Members Find it Easier to Apply for Child Care Benefits . . . . . . . . 4

Healthcare Employees Pension Fund Recovers, Slowly But Surely added a Google map feature to the child care provider listing to help members select providers close to their home or worksite. With these improvements, 42 percent of members were able to register online, an increase of seven percent over last year.

Over the next year, the Fund will continue to improve the registration process, with the goal of ensuring that every eligible member is able to apply for these benefits.

Like every pension fund in the country, the 1199SEIU Health Care Employees Pension Fund experienced enormous losses when the markets crashed in 2008.

Although the market gained ground in 2009, the improvements are still incremental, and economists predict that a full recovery will take years. But, as the economy slowly turns around, the asset returns in our pension funds have increased. Our investment projections suggest that we may have achieved as much as a 17 percent return on our assets in 2009, climbing to an estimated $6.6 billion from $5.9 billion at the end of 2008.

While this is certainly an improvement over the dramatic 32.4 percent loss the Fund suffered in 2008, the Pension Fund’s assets remain well below where they stood before the economic downturn. The Fund is still considered in “Critical Status" under the federal Pension Protection Act, but with the rehabilitation plan adopted by the collective bargainers and trustees in place, it is on the road to recovery.

As always, we continue to carefully monitor and safeguard these assets to bring the Pension Fund back up to full funding and ensure financial security for your 1199SEIU employees in their retirement.

1199 SEIU Employer News Spring 2010_Layout 1 3/31/10 8:52 AM Page 2

Pharmacy Innovation Award Recognizes National Benefit Fund’s Creative Cost Containment Strategies Since implementing our cost containment initiatives five years ago, the National Benefit Fund has saved more than $200 million through innovative strategies that have contained costs, while protecting your 1199SEIU employees’ access to quality care. In 2008, these programs kept our prescription trend to a -1 percent without shifting costs to members, while around us the industry average was between eight and 10 percent.

This achievement was recently recognized by the Pharmacy Benefit Management Institute (PBMI), which honored the National Benefit Fund with a 2010 Rx Benefit Innovation Award in February. PBMI sponsors this prestigious industry award as part of its educational mission to recognize innovative solutions to problems surrounding drug benefit programs nationwide.

The Fund’s creative strategy for containing rising prescription costs has been to allow members access to the medications they need with no out-of-pocket costs as long as they comply with our prescription programs. When 1199SEIU members use the Preferred Drug List, generic medications, and The 90-Day Rx Solution mail order program for long-term medications, they do not pay out of pocket.

Of the 2.3 million prescriptions dispensed last year, 66.4 percent were generic. That’s 2.4 percent higher than our PBM’s other labor clients. In fact, physician and member compliance with generic substitution for brand-name drugs – where one existed – was 99.3 percent.

Last year, we also eliminated the cap on the differential members paid when they filled a non-preferred prescription.

Now, if members go outside these programs and use nonpreferred medications or pick up monthly supplies of long-term prescriptions at the pharmacy, they are responsible for paying the full difference.

2 EMPLOYER NEWS Spring 2010

This strategy works for everyone. Members continue to have access to the most clinically effective medications on the market, and the Fund is protected from significantly higher costs. When other health plans give plan participants the option of accessing higher-cost medications through tiered plans, many still choose to pay for the more expensive medication. For the participant, the difference may represent a jump from a $10 co-pay to a $40 co-pay. But for the plan, that jump from a preferred to a nonpreferred medication could translate to an additional cost of hundreds of dollars. 1199SEIU members, on the other hand, are responsible for the true cost difference, which encourages their compliance and preserves critical benefit dollars.

“In an era of aggressive cost shifting to participants, 1199SEIU has proven it is possible to control costs by implementing aggressive management strategies instead of imposing an additional financial burden on members.

Your successful engagement of members in the cost containment program is commendable,” said Dana Felthouse, president of PBMI.

New Prescription Initiatives Bring National Benefit Fund Closer to Cost Containment Target The National Benefit Fund continues to build on our prescription programs for increased savings. As of February 1, the Fund, like many other health plans, no longer covers erectile dysfunction medications. To reduce expenses for drugs that are also available over the counter, the Fund will no longer cover prescription cough and cold medications after April 1. Finally, as we continue to work with our clinicians and Medco to refine our Preferred Drug List, we will add two new classes for antivertigo/antiemetic agents, and steroids used to treat ear infections, and remove some brand-name, oral hypoglycemic drugs used to treat diabetes, since there are equally effective generics and lower-cost brands available.

These changes are projected to save the National Benefit Fund $2.3 million per year.

Training and Employment Funds Train Environmental Workers for Tomorrow’s Green Careers Healthcare workers in environmental services, such as housekeeping, are a critical link in keeping the workplace safe and healthy for patients and their co-workers. With the new “green” focus on healthcare, these jobs will become even more critical in the coming years.

To prepare these workers and our institutions for the future, the Training and Employment Funds will be one of the partners in a national project funded by the U.S. Department of Labor with a grant to the Healthcare Career Advancement Program (H-CAP), a national partnership between SEIU, employers and joint training funds. The $4.6 million grant will provide training to workers at three League institutions, including St. Vincent's Hospital, Montefiore Medical Center and NYU Langone Medical Center, as well as in California, Washington State and Maryland.

Through the training sessions, workers will learn principles of green cleaning and its importance in health, safety and infection control; methods of waste management that can

Training Fund Conference Prepares Institutions to “Go Green” As part of its work in preparing our workers and institutions for new green jobs, the Training and Upgrading Fund recently sponsored an accredited six-hour symposium for 750 participants on “The Greening of Healthcare.” The program – “The Clinician’s Role in ‘Going Green’ ” – was designed to raise awareness, foster discussion and inspire action among workers and management to achieve sustainable practices that will improve worker safety and improve patient outcomes. The symposium was co-sponsored by Practice Greenhealth and Health Care Without Harm, two companies in the forefront of the greening of healthcare both nationally and internationally.

For more information on upcoming workshops and symposiums on issues affecting our industry, visit www.1199SEIUFunds.org.

reduce costs to both employers and the environment; and ways to monitor energy and water consumption to reduce our institutions’ carbon footprint. Workers will also be educated on some of the new math and science skills that they will need to advance in their careers in the newly emerging green jobs sector.

On top of the training, the employers and the Union will work together to implement green changes in their departments to support infection control, reduce energy, water use and waste, and recognize the value that environmental services workers bring to their healthcare institutions. And since the new green focus will also create a need for some new jobs in hospitals, the Funds will work closely with the Union and employers to design these new jobs in ways that both meet employer needs and allow workers to move up the first steps of a new green career ladder.

"Environmental service workers are a critical part of the greening of our institutions," said Christopher Berner, Assistant Vice President of Labor and Employee Relations at Montefiore Medical Center. "We're looking forward to working with the Union, the Fund and our employees to move forward together on this exciting new initiative."

Spring 2010 EMPLOYER NEWS 3

1199 SEIU Employer News Spring 2010_Layout 1 3/31/10 8:52 AM Page 2

Pharmacy Innovation Award Recognizes National Benefit Fund’s Creative Cost Containment Strategies Since implementing our cost containment initiatives five years ago, the National Benefit Fund has saved more than $200 million through innovative strategies that have contained costs, while protecting your 1199SEIU employees’ access to quality care. In 2008, these programs kept our prescription trend to a -1 percent without shifting costs to members, while around us the industry average was between eight and 10 percent.

This achievement was recently recognized by the Pharmacy Benefit Management Institute (PBMI), which honored the National Benefit Fund with a 2010 Rx Benefit Innovation Award in February. PBMI sponsors this prestigious industry award as part of its educational mission to recognize innovative solutions to problems surrounding drug benefit programs nationwide.

The Fund’s creative strategy for containing rising prescription costs has been to allow members access to the medications they need with no out-of-pocket costs as long as they comply with our prescription programs. When 1199SEIU members use the Preferred Drug List, generic medications, and The 90-Day Rx Solution mail order program for long-term medications, they do not pay out of pocket.

Of the 2.3 million prescriptions dispensed last year, 66.4 percent were generic. That’s 2.4 percent higher than our PBM’s other labor clients. In fact, physician and member compliance with generic substitution for brand-name drugs – where one existed – was 99.3 percent.

Last year, we also eliminated the cap on the differential members paid when they filled a non-preferred prescription.

Now, if members go outside these programs and use nonpreferred medications or pick up monthly supplies of long-term prescriptions at the pharmacy, they are responsible for paying the full difference.

2 EMPLOYER NEWS Spring 2010

This strategy works for everyone. Members continue to have access to the most clinically effective medications on the market, and the Fund is protected from significantly higher costs. When other health plans give plan participants the option of accessing higher-cost medications through tiered plans, many still choose to pay for the more expensive medication. For the participant, the difference may represent a jump from a $10 co-pay to a $40 co-pay. But for the plan, that jump from a preferred to a nonpreferred medication could translate to an additional cost of hundreds of dollars. 1199SEIU members, on the other hand, are responsible for the true cost difference, which encourages their compliance and preserves critical benefit dollars.

“In an era of aggressive cost shifting to participants, 1199SEIU has proven it is possible to control costs by implementing aggressive management strategies instead of imposing an additional financial burden on members.

Your successful engagement of members in the cost containment program is commendable,” said Dana Felthouse, president of PBMI.

New Prescription Initiatives Bring National Benefit Fund Closer to Cost Containment Target The National Benefit Fund continues to build on our prescription programs for increased savings. As of February 1, the Fund, like many other health plans, no longer covers erectile dysfunction medications. To reduce expenses for drugs that are also available over the counter, the Fund will no longer cover prescription cough and cold medications after April 1. Finally, as we continue to work with our clinicians and Medco to refine our Preferred Drug List, we will add two new classes for antivertigo/antiemetic agents, and steroids used to treat ear infections, and remove some brand-name, oral hypoglycemic drugs used to treat diabetes, since there are equally effective generics and lower-cost brands available.

These changes are projected to save the National Benefit Fund $2.3 million per year.

Training and Employment Funds Train Environmental Workers for Tomorrow’s Green Careers Healthcare workers in environmental services, such as housekeeping, are a critical link in keeping the workplace safe and healthy for patients and their co-workers. With the new “green” focus on healthcare, these jobs will become even more critical in the coming years.

To prepare these workers and our institutions for the future, the Training and Employment Funds will be one of the partners in a national project funded by the U.S. Department of Labor with a grant to the Healthcare Career Advancement Program (H-CAP), a national partnership between SEIU, employers and joint training funds. The $4.6 million grant will provide training to workers at three League institutions, including St. Vincent's Hospital, Montefiore Medical Center and NYU Langone Medical Center, as well as in California, Washington State and Maryland.

Through the training sessions, workers will learn principles of green cleaning and its importance in health, safety and infection control; methods of waste management that can

Training Fund Conference Prepares Institutions to “Go Green” As part of its work in preparing our workers and institutions for new green jobs, the Training and Upgrading Fund recently sponsored an accredited six-hour symposium for 750 participants on “The Greening of Healthcare.” The program – “The Clinician’s Role in ‘Going Green’ ” – was designed to raise awareness, foster discussion and inspire action among workers and management to achieve sustainable practices that will improve worker safety and improve patient outcomes. The symposium was co-sponsored by Practice Greenhealth and Health Care Without Harm, two companies in the forefront of the greening of healthcare both nationally and internationally.

For more information on upcoming workshops and symposiums on issues affecting our industry, visit www.1199SEIUFunds.org.

reduce costs to both employers and the environment; and ways to monitor energy and water consumption to reduce our institutions’ carbon footprint. Workers will also be educated on some of the new math and science skills that they will need to advance in their careers in the newly emerging green jobs sector.

On top of the training, the employers and the Union will work together to implement green changes in their departments to support infection control, reduce energy, water use and waste, and recognize the value that environmental services workers bring to their healthcare institutions. And since the new green focus will also create a need for some new jobs in hospitals, the Funds will work closely with the Union and employers to design these new jobs in ways that both meet employer needs and allow workers to move up the first steps of a new green career ladder.

"Environmental service workers are a critical part of the greening of our institutions," said Christopher Berner, Assistant Vice President of Labor and Employee Relations at Montefiore Medical Center. "We're looking forward to working with the Union, the Fund and our employees to move forward together on this exciting new initiative."

Spring 2010 EMPLOYER NEWS 3

1199 SEIU Employer News Spring 2010_Layout 1 3/31/10 8:52 AM Page 1

1199SEIU Funds 330 West 42nd Street New York, NY 10036-6977

Non-Profit U.S. Postage PAID New York, NY Permit No. 3700

Spring 2010

Members Find it Easier to Apply for Child Care Benefits The Child Care Fund is committed to making sure every eligible 1199SEIU member is able to register for the child care benefits that your contributions support. Recognizing that 1199SEIU parents are already juggling work, child care and other responsibilities, the Fund has turned its focus in the past year to making the registration process as simple and convenient as possible. As a result, more than 14,000 1199SEIU members were able to apply for child care benefits during the 2010 registration period this past fall.

IN THIS ISSUE . . .

As contributing employers, you already know about the work our Funds are doing every day to support your 1199SEIU employees with comprehensive benefits in the most cost-effective way. In this issue of 1199SEIU Employer News, you will read about how our programs are making a difference not only to our members, but throughout the healthcare industry.

Pharmacy Innovation Award Recognizes National Benefit Fund’s Creative Cost Containment Strategies . . . . . . . 2

After many years of successful cost containment initiatives, the National Benefit Fund has been recognized with a national award for our innovative prescription programs – programs that are helping us reach our mandate to save an additional $150 million over the next five years.The Training and Employment Funds are partnering in a new national initiative supported by the U.S. Department of Labor to prepare healthcare workers and our institutions for the green jobs of tomorrow. Meanwhile, our Child Care Fund has been hard at work streamlining its registration process to enable a record number of members to register for child care benefits in 2010.

Together, we are working to improve members’ lives and support the efforts of our healthcare industry, and we hope you enjoy this issue of your Employer News.

As in past years, the Fund offered in-person registration for members at sites across New York City and in upstate New York, with extended hours to accommodate working parents’ schedules. Members visiting our Manhattan and Hicksville, Long Island, offices had the option of seeing a registration clerk, or registering online at computer terminals under the guidance of a staff person. While the majority of members registering in person visited the Fund’s Manhattan office, more than 1,000 parents came in to register for benefits at the Hicksville site. The Fund’s own staff was supported by 34 1199SEIU parents who serve on the Child Care Fund’s Advisory Committee and were on hand to help their fellow members through the process.

Since we understand that it can be difficult for 1199SEIU members to get to a registration site in person, the Fund also focused on improving the online registration process. Fund staff created an updated version of the online registration tutorial, which guides members through the process step by step, from start to finish, and created an extended and more detailed instruction manual that members can download and print for their convenience. Finally, the Fund

FROM THE EXECUTIVE DIRECTORS

Sincerely,

Mitra Behroozi Executive Director Benefit and Pension Funds

Deborah King Executive Director Training and Employment Funds

Vivian Fox Executive Director Child Care Funds

New Prescription Initiatives Bring National Benefit Fund Closer to Cost Containment Target . . . . . . . . . . . . . . . . . . . . 2 Training And Employment Funds Train Environmental Workers for Tomorrow’s Green Careers . . . . . . . . . . . . . . 3 Training Fund Conference Prepares Institutions to “Go Green” . . . . . . . . . . . . . . . . 3 Members Find it Easier to Apply for Child Care Benefits . . . . . . . . 4

Healthcare Employees Pension Fund Recovers, Slowly But Surely added a Google map feature to the child care provider listing to help members select providers close to their home or worksite. With these improvements, 42 percent of members were able to register online, an increase of seven percent over last year.

Over the next year, the Fund will continue to improve the registration process, with the goal of ensuring that every eligible member is able to apply for these benefits.

Like every pension fund in the country, the 1199SEIU Health Care Employees Pension Fund experienced enormous losses when the markets crashed in 2008.

Although the market gained ground in 2009, the improvements are still incremental, and economists predict that a full recovery will take years. But, as the economy slowly turns around, the asset returns in our pension funds have increased. Our investment projections suggest that we may have achieved as much as a 17 percent return on our assets in 2009, climbing to an estimated $6.6 billion from $5.9 billion at the end of 2008.

While this is certainly an improvement over the dramatic 32.4 percent loss the Fund suffered in 2008, the Pension Fund’s assets remain well below where they stood before the economic downturn. The Fund is still considered in “Critical Status" under the federal Pension Protection Act, but with the rehabilitation plan adopted by the collective bargainers and trustees in place, it is on the road to recovery.

As always, we continue to carefully monitor and safeguard these assets to bring the Pension Fund back up to full funding and ensure financial security for your 1199SEIU employees in their retirement.