Faculty Rip Dye on Budget, Healthcare
A tense College Faculty meeting Tuesday was ripe
with discord, as professors shot barbed questions at College administrators
over the current budget deficit and a forthcoming healthcare plan.
“The agenda item for today is the budget,” Dean of the
College Clayton Koppes began. “I want to have what the students
refer to as an open forum.”
But what was supposed to be a forum for budget discussion quickly
devolved into a heated debate over the future of the College’s
new healthcare plan. Some faculty expressed concern that increased
healthcare costs could negate their raises.
Passing sizable health insurance costs onto faculty and staff represents
a dramatic shift from the current system, where the College bears
nearly all of the cost.
Faculty asked College President Nancy Dye if she felt this change
was “fair.” Dye responded emphatically.
“I do think it’s fair. I also think it’s necessary,”
she said. “We have had an extraordinary healthcare plan at
Oberlin College, but it is not sustainable.”
“There is no way for the College to continue to add millions
of dollars to align with a budget that is out of control,”
she continued. “We have a plan that we can no longer pay for
any longer…. The cost sharing is so unlike elsewhere in the
“The truth of the matter,” Dye said, “is that
if we do not get this under control, this institution will be harmed
Administrators charged the faculty’s benefits committee last
winter with proposing a new healthcare plan after healthcare costs
ballooned to $9.2 million. The committee hired a consulting firm,
Mercer Management Consulting, to evaluate the plan.
The current arrangement, Benefits Committee Chair and Economics
Professor Jim Zinser said, “was as generous as Mercer had
ever seen.” Among other things, it included unlimited psychiatric
benefits and coverage at the Mayo Clinic.
“The plan,” Zinser, added, “will include increases
The maximum share the College could afford was reduced over the
summer to $7.5 million from an original $8 million, he said.
The new plan, Zinser said, will include significant deductibles,
bring the College’s share to 90% of coverage and lower the
co-payment for pharmaceuticals. Also, there will be a larger network
of providers, including international options, he said.
But, he added, the current price per person is unknown, as negotiations
with a third-party company continue.
From there, the tone quickly soured.
Economics Professor Robert Piron asked Zinser if he would tell the
faculty the size of the deductibles proposed in the new plan. When
Zinser couldn’t answer, Piron disclosed them himself, pointing
out the unseen cost employees may bear under the new plan.
Single employees, he said, will have to pay the first $250 of healthcare
costs each year, and employees with family coverage, $750. This
figure is the out of pocket maximum per year.
Yet if employees ever go to out-of-network hospitals or physicians,
the costs rise dramatically, Piron said. Single employees could
pay up to $500 and family employees up to $1500. This does not include
the employees’ premiums.
With the premiums, he said, “If you’re out of network,
it is $2,500 for a single and $5,000 for a family.”
Politics Professor Marc Blecher noted that when deductibles and
co-payments were taken into account, employees would be paying for
significantly more than the 10 percent Zinser had suggested.
“The faculty member would be paying about half the cost,”
he said. “That’s a lot.”
Dye, Zinser and Associate Vice President Ron Watts discounted this
“The employee share through premiums will be 14 percent,”
English Professor James Dobbins then queried about the budget deficit.
“It seems like we’re trying to do a nibble strategy,”
he said. “Is the administration also considering the possibility,
to retain the medical metaphor, of amptutation?”
This brought a round of laughs.
“Yes,” Dye replied. “I’m not sure I like
the amputation model here, but definitely [we’re seeking]
a more strategic model.”
32 positions have been eliminated through the hiring freeze, Dye
said. “They will not be coming back in the near or foreseeable
Piron then went on a self-described “tirade,” chiding
the administration and the Board of Trustees for promising to bring
faculty salaries to a competitive level. The new healthcare costs,
he said, will nullify any raises this year.
“Most of the raises that everyone got will be wiped out with
the healthcare with normal utilization,” he said. “For
the first time in my memory, we will have actually reduced the nominal
“If this bores you,” he added, responding to those who
seemed to be irked by his speeches, “I think there’s
no hope for us here.”
“In the ‘90s, we ran millions of dollars of budget surpluses,”
he continued. “One of the things we can do is make sure this
hard landing never happens again.”
He proposed that the College create a reserve fund to help allay
the mushrooming healthcare costs. “The budgetary life of surpluses
at Oberlin is eight nanoseconds,” he said.
Dye shook her head through parts of Piron’s speech, and said
that while she agreed with the idea of reserve funds, no money was
“We could say let’s cut another million dollars on top
of the one million dollars we cut,” she replied.
She also said that she believed that faculty salaries had been made
competitive, except at the full professor level.
“Raises through the ‘90s were good across the board,”
When asked whether the College was looking at ways of enhancing
revenues, instead of simply making cuts, Dye responded positively.
The Board of Trustees, she said, had signed off on the addition
of 30 students to the student body, and plans to add 130 beds for
new student housing. Both of these decisions will augment the College’s
Noticeably absent from the meeting was Vice President of Finance
Andrew Evans, who was at a finance vice presidents’ conference,