The financial mismanagement of the former St. Louis-Kansas City Carpenters’ Regional Council by disgraced former Executive Secretary-Treasurer, Al Bond, is starting to trickle its way downward. Only a few months after being absorbed by the Chicago Regional Council of Carpenters, Trustees of the St. Louis-Kansas City Carpenters Health and Welfare Fund have levied enormous penalties on rank-in-file members. In March, Trustees announced that Healthcare Bluebook, a service that allowed members to select procedures at medical centers via price, had been eliminated. Healthcare Bluebook was designed to encourage members to actively participate in protecting the financial strength of the St. Louis-Kansas City Health and Welfare Fund by providing a portion of any medical procedure savings to the member. Nevertheless, it has been eliminated.
Additional adverse changes were dropped on unsuspecting members this week. On Tuesday, members started to receive notice that there will be substantial increases in the man-hours needed to qualify for health insurance. For example, the hours needed to have quarterly insurance coverage extended through the following benefit quarter went up 20 percent. Yes, you read that correctly. Each member will now need 360 man-hours in a quarter to receive health insurance for the succeeding quarter. Under the old format, a member working 300 hours in a quarter would qualify for coverage in the next health quarter.
Changes to the Plan Year Rule also increased by 20%, from 1300 man-hours to 1560 man-hours. Essentially, the plan is requiring members to increase their work hours by almost seven 40-hour work weeks over the calendar year to receive a 6-month extension of insurance into the ensuing year. To make matters worse, under the old format, members who worked 1300 hours in a plan year would receive an extension of benefits for 10 to 12 months. The changes made punish members in two ways. In short, a 20% increase in contributions will net you a 6-month loss in continuing benefit coverage.
After two years of Covid-19 and man-hours decreasing across the board, the Trustees decided to further punish members who relied upon the self-pay option. It is the self-pay option that allows members to cover lapses in their respective work hours. The plan will now require members requiring the self-pay option to pay the difference on the newly implemented 360 quarterly hour requirement, rather than the old 300-man hours. To be certain, the self-pay option was already expensive for members who faced job losses due to Covid-19 and its ensuing fallout. The newly implemented increase will make it very hard for members to justify making minimum difference payments. Thus, leaving economically stressed members to deal with potential health issues without health coverage.
In an attempt to be fair, I concur that Covid-19 negatively effected the Health and Welfare Fund. Covid-19 related medical costs were something new to the plan, meanwhile, man-hours were reduced via Covid-19 related work rules. In fact, the Trustees describe a loss of $15 million dollars in 2021 health and welfare fund revenue that they directly attribute to Covid-19’s workplace limitations.
However, the Trustees fail to take responsibility for mistakes they made. For instance, despite expanding coverage a few years ago, the Trustees failed to increase hourly contributions for the fund. The health and welfare fund has not realized a contribution increase in three years. Further hindering the financial propriety of the health and welfare fund is an expenditure made in Kansas City, Missouri. The project lacked the required Department of Labor paperwork and spits in the face of fiduciary duty. This project can only be described as an utter failure. The Kansas City Wellness Center, completed in August of 2021, has yet to see a single patient. Let me repeat myself, a multi-million-dollar building has been sitting empty for over seven months, without treating a single member. Meanwhile, the costs to operate the building are passed along to the health and welfare fund. Not surprisingly, I have been told by a reputable source that the facility will not see patients until 2023 at best. Why are the members being punished for the poor decisions of labor and management Trustees?
Lastly, United Brotherhood of Carpenters and Joiners General President, Douglas J. McCarron, admitted to members that the Trustees, under Al Bond’s leadership, had paid investment fees that were substantially higher than what was necessary and/or common. To be specific, McCarron stated $21 million dollars was paid out, when $6 million would have been appropriate. Why are these poor decisions not being addressed? Why are the Trustees who created the current situation still Trustees? Once again, leadership fails, and the members suffer.
