Nov 21, 2005
Delphi, GM, and other auto companies justify cutting workers’ wages and benefits, saying they can no longer afford the astronomical costs of health care. They claim they pay $26 an hour for workers’ health care.
If companies paid for health care at the rate of $26 an hour, they would be paying $1040 for a 40-hour week, $4160 for a 4-week month, and $54,080 for a 52-week year – per worker! Not to mention all the extra on overtime.
No health insurer charges individuals even remotely this much, no matter how “gold-plated” the benefits! Find a health insurer that charges $54,080 per person per year in premiums – and you’ll find an insurer whose customers have gone elsewhere!
Today, Blue Cross/Blue Shield of Michigan advertises the following rates for individuals who convert from employer plan coverage to individual coverage: for their very best, most expensive plan: $293.94 per month per individual; $587.88 for two people; $617.27 per family.
Taking the most expensive figure, it comes out to only $7407.24 a year – $46,673 LESS than what GM claims!
In fact, big companies pay less than what individuals pay for insurance, because they pay group rates to insurance companies to administer their plans. AND they “self-insure” – which lowers their cost still more.
But let’s not quibble. And let’s even double what GM has to pay to account for dental insurance, etc. And suppose they paid for a family plan for EVERY worker – that would cost them only $14,800 per year, per worker.
Delphi and GM and the rest could still put each and every worker under one of these individually purchased, top notch plans – and SAVE more than $39,000 per worker per year for complete coverage!
In reality, no detailed comparison can be made until workers make a thoroughgoing inspection of the companies’ books and all their business practices. But anyone can get some idea of the scale of their deception by checking examples like this one, or by comparing with someone they know who buys their own medical insurance.
Our example works out to a health-care cost for a family of $7.12 per hour. If companies keep on insisting that their costs are $26 per hour, then workers have the right to insist on at least $18.88 an hour in change – in their paychecks!
Workers might also pause to consider why the leaders of their own unions don’t challenge the companies’ unbelievable figures. Is this the partnership in action?