Carleton University Graduate Students’ Association

Membership Advisory #5: GSA Health, Dental and Accident Plan

Prepared by and distributed on behalf of the Board of Directors of GSA Carleton Inc. January 30, 2013.

The GSA Board of Directors is pleased that CUSA submitted a Statement of Defence on January 24, 2013. The Board appreciates receiving a slightly better glimpse into CUSA's position on the matter.

The Health, Dental and Accident Plan has recently received some media attention. This has included an opinion piece in the Charlatan - written by former GSA and CUSA executives - that clarifies the original intent of the CUSA-GSA Drug/Accident and Dental Plan Agreement signed in 2000.

The February issue of The Leveller contained coverage of the history of the CUSA-GSA Health plan, and of the current dispute.

Membership Advisory #4: GSA Health, Dental and Accident Plan

Prepared by and distributed on behalf of the Board of Directors of GSA Carleton Inc. January 22, 2013.

The previous Membership Advisory (see below) detailed the GSA Carleton Inc. Board of Directors’ difficult decision to pursue legal action against CUSA Inc. over CUSA’s purported unilateral termination of two health plan agreements and their claim to 100% ownership of funds held in the health plan reserve.

The Board of Directors of GSA Carleton Inc. is disappointed to report that after missing yet another deadline, CUSA and its legal counsel have asked for a fourth extension to file their Statement of Defense.

As recommended by its legal counsel, the Board has agreed to provide the additional extension. The Board is hopeful that the process is not being stalled intentionally or for extra-judicial purposes and has the expectation that the CUSA executive will take responsibility for their stewardship of the undergraduate student association.

The Board of Directors of GSA Carleton Inc. will continue to examine all of its available options in consultation with legal counsel.

Membership Advisory #3: GSA Health, Dental, and Accident Plan

Prepared by and distributed on behalf of the Board of Directors of GSA Carleton Inc. October 31, 2012.

The GSA Carleton Inc. Board of Directors has continued its efforts to address the decision by the Carleton University Students’ Association and CUSA Inc. to attempt to unilaterally terminate two agreements regarding the Health, Dental, and Accident Plan with GSA Carleton Inc. at the end of July 2012. Despite its best efforts, the Board has not been able to reach a satisfactory resolution and the CUSA executive continues to refuse to meet under the terms of the Joint Oversight Committee for the plan – a committee established in a 2000 agreement between the two parties.

The Board has made the very difficult decision to serve CUSA with legal action. While the legal action progresses, there may be limitations as to what the Board can publicly disclose. However, the Board believes it is important for members of the GSA to understand why this action is being undertaken.

There are two primary reasons the Board is undertaking legal action. First, the Board is asking the court to rule on the legality of CUSA’s attempts to cancel two joint health plan agreements with the GSA. For over a decade CUSA and the GSA have had a joint plan that could be dissolved through mutual consent or a referendum of either Associations’ membership. These means of termination were established to ensure stability of the plan for students and to avoid sudden disruptions to a crucial service for our respective memberships. In July 2012, CUSA President Alex Golovko and Vice-President Finance Michael DeLuca moved a motion at CUSA Council to redefine ‘referendum’ such that a ‘referendum’ purportedly became a vote of the three CUSA executives who are Trustees of CUSA Inc. The Board of GSA Carleton Inc. strongly believes that, in addition to these actions being profoundly undemocratic, changing By-Laws for the sole purpose of breaking contracts is not legally defensible. CUSA and the GSA also have many other agreements regarding finances and services to our memberships that need to be respected.

The Board is also taking legal action to block attempts by the CUSA executive to unilaterally liquidate the health plan reserve funds. The Board asserts that these funds are jointly owned and must be used in a manner consistent with the purpose for which they were accumulated.

The joint health plan was in a strong financial position. As a not-for-profit plan, it used a ‘refund’ (or ‘retention’) accounting method. This method means that after student health claims and administrative fees are paid out, any surplus accrues in a reserve account. Under many for-profit plans, these funds simply result in additional profit for the broker and/or insurer. The joint plan’s reserve funds can be applied against future unexpected losses (such as in the event of a pandemic), and allowed the GSA and CUSA to improve the plan’s benefits without risking its stability (as was done for 2012-2013). The reserve also lowers risk to the insurer and thus facilitated better rates for GSA and CUSA members. As has been stated in a previous Membership Advisory, the Board of Directors for GSA Carleton Inc. will utilise any and all lawful means to prevent CUSA from claiming exclusive ownership of this reserve fund.

For additional information, please read the two previous GSA Membership Advisories (below) regarding the health plan. Questions can be directed to GSA President Kelly Black at pres@gsacarleton.ca. The Statement of Claim filed by GSA Carleton Inc. is a public document (attached).

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Membership Advisory #2: CUSA/GSA Health, Dental, and Accident Plan

Prepared by and distributed on behalf of the Board of Directors of GSA Carleton Inc. July 31, 2012.

Dear Members,

As you are likely aware from our previous Membership Advisory (below), the Carleton Undergraduate Students’ Association (CUSA) has been privately negotiating a new for-profit health plan.

Last week, in an emergency meeting called by CUSA President Alex Golovko, CUSA council passed a motion to change its bylaws. This highly questionable change was intended to give the CUSA Inc. Board of Trustees (President, VP Finance, and VP Internal) power to hold a “referendum” amongst themselves to approve or terminate various contracts related to our joint Health, Dental, and Accident Plan.

As of July 31st, 2012, CUSA Inc. has chosen to break existing contracts, two of which are with the GSA, and pursue a new health plan with a new broker. GSA Carleton Inc. maintains that these contracts are operative and in full force and effect.

The GSA Carleton Inc. Board of Directors would like to outline why CUSA’s new health plan and the actions of CUSA are unacceptable:

1) The current year (2012) is not a contract renewal period and the CUSA Inc. Board of Trustees has placed itself in legal peril for no justifiable reason.

2) CUSA Inc. has sole-sourced the health plan rather than performing basic due diligence such as undertaking a comprehensive tendering process.

3) The plan CUSA has locked itself into is a long-term, five year agreement. There are no guaranteed benefit levels beyond the first year, and no rate guarantees beyond the second year.

4) The new plan is inferior to the current plan, particularly with regards to drug and dental coverage.

5) CUSA has not been transparent and has refused to divulge the broker’s fees and commissions for the new plan. Overall, financing of the plan is incomplete.

6) The new plan proposal identifies reducing the number of students who opt out of the plan as one method to mitigate the cost of the plan.

These and other concerns have made it obvious to the GSA Board of Directors that the new plan adopted by CUSA’s Trustees is not in the best interest of students. The joint agreement signed between CUSA and the GSA in 2000 has provided a consistently improving health plan for Carleton students for over eleven years. It is regrettable that CUSA’s Trustees have gone to such lengths to violate agreements and damage their relationship with the Carleton graduate student community.

The Board of Directors of GSA Carleton Inc. would like to reassure graduate students at Carleton that they will have continued access to their health, dental and accident plan, including the substantial improvements to the plan commencing September 1st that have been previously announced. The staff and executive of the GSA have been working with the current broker to ensure that graduate students will receive the support needed to access their benefits.

For more information, and to read the previous GSA Membership Advisory below.

Membership Advisory: CUSA/GSA Health, Dental, and Accident Plan

Prepared by and distributed on behalf of the Board of Directors of GSA Carleton Inc. July 12, 2012.

For many years the GSA and CUSA have jointly offered a not-for-profit Health, Dental and Accident Plan (the “Plan”) for students at Carleton University. The cost to students of the current plan has been stable for six years while benefits have consistently improved. Decisions on changes to the plan have been made by the Joint Oversight Committee as established in the Drug/Accident and Dental Plan Agreement (2000) between the GSA and CUSA. In 2011, CUSA and the GSA signed a three year agreement with the broker, Morneau-Shepell, and by extension Green Shield Canada, the only national not-for-profit health plan provider.

In late June, 2012, the GSA was made aware that the Vice-President Finance for CUSA, Michael De Luca, was attempting to unilaterally withdraw funds from the joint reserve fund. This fund is held in trust by Green Shield, and can be used to off-set the costs of the not-for-profit plan if claims reach unexpected levels (for example, if there was a pandemic). At a subsequent meeting, CUSA VP Finance Michael De Luca and CUSA President Alex Golovko indicated to the GSA that CUSA has been negotiating behind the scenes with a private for-profit health plan broker. The CUSA representatives also indicated their intent to break the current agreement with Morneau-Shepell and potentially break a separate agreement with the GSA. The CUSA representatives provided an ultimatum to GSA representatives that did not include the option of continuing with the current plan or respecting existing plan agreements. Furthermore, it was stated that CUSA would not reveal the broker for the alternative plan or any details about the plan unless the GSA first agreed to break its existing contracts, and switch to the new plan.

The GSA Board's primary focus is to make sure our members are receiving the best value and service from this program. Therefore, the GSA sent a number of important questions and requests for information to CUSA to determine if this program provides superior value. CUSA has not responded to any of the GSA requests for additional information on plan design, coverage levels, broker/insurer fees/commissions, etc.

The Board of Directors of GSA Carleton Inc. want to assure members that no change to the Health, Dental and Accident Plan will be made without seeking multiple tenders, a rational and transparent process, consideration of existing legal agreements and, most of all, a comprehensive understanding of the cost and benefits of a new plan, and an independent, professional analysis of the complex details these types of agreements can contain. The Board is concerned that CUSA representatives do not appear to be following a transparent process, may not be considering their members’ best interests, and may not have an understanding of the complexity of health, dental, and accident insurance plans.

Some of the concerns expressed by the Board include:

The potential legal costs associated with breaking existing contracts without cause.
The possibility of being held liable for premiums for two separate plans provided by two separate brokers.
Uncertainty as to whether CUSA is engaging a broker that offers cheap rates for the first year of a multiyear plan and then increases the costs or reduces benefits. The high turnover at students’ unions has not gone unnoticed by predatory for-profit health plan brokers.
Administration of the plan. To-date, CUSA has not hired a Health Plan Administrator (HPA) following the April departure of the former HPA. The plan operates on a September 1 to August 31 calendar. The ability to opt-out of the plan normally begins in mid-August. Under the existing agreements the GSA and members of the plan pay CUSA to have an on-campus HPA. The uncertainty and the possibility of poor service associated with a switch in health plans at this late date is not acceptable to the Board of Directors of the GSA.

The Board of Directors is taking the following steps to address this matter:

1. Holding regular meetings and addressing the issue with GSA Council.

2. Ensuring legal representation that is informed and available.

3. Continuing to request information from CUSA regarding its intentions and details of the alternate plan supported by CUSA representatives.

4. Seeking a commitment from Morneau-Shepell and Green Shield that all reasonable efforts will be made to ensure GSA members will not experience service disruptions should CUSA attempt to break existing contracts or fail to fulfill its obligations with regards to the frontline administration of the plan.

5. Planning to approach the administration of Carleton University to access the required data to ensure GSA members are enrolled in and can access benefits of the Plan.

6. Ensuring that the GSA will not be liable for the actions of CUSA should the broker initiate legal proceedings as a result of CUSA attempting to terminate the contract.

7. Investigating all options for recourse should CUSA attempt to terminate existing contracts.

8. Ensuring that any reserve funds are not released without the consent of the GSA, and to seek a court injunction to this effect if necessary.

Thank-you for taking the time to read this Membership Advisory. As has probably been made clear from this Advisory, insurance plans are complex financial and legal arrangements. We hope that this message has made it clear that the GSA will continue to act in the best interest of its membership. If you have any questions, or you wish to offer feedback regarding this Advisory, please contact Kelly Black, GSA President, at pres@gsacarleton.ca.

GSA Health Plan Benefit Improvements 2012-2013

March 28, 2012

CUSA and the GSA are proud to announce improvements to the health and dental plan again this year AT NO EXTRA COST to you!

Last year, we increased the dental maximum to $600.00 and added Optometrist exams.

Effective September 1, 2012 we have added:

A vision care benefit of $150.00 every two years including eye exams. This is a $100.00 increase which can be used toward your eye examination or prescription lenses.
Wisdom teeth coverage has been improved with its own maximum benefit of $500.00 per lifetime. This means that dental coverage has increased in some cases to $1,100.00 for 2012.

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