MEDICAL FOR ACTIVE EMPLOYEES

The information below describes the proposed medical coverage for active employees. While these are the proposed options the company intends to offer, the actual changes that will be implemented will not be finalized until later in the year.

 

Our Approach

American currently offers a variety of healthcare options to our employees at varying costs to both the company and the employee. This is a costly and inefficient approach. American seeks to create universal health programs for employees that standardize and simplify our benefits programs. Therefore, AA is planning to offer all employees three medical options: a Standard option; a Core, Health Savings Account compatible option; and a Value option available at higher contribution rates.

 

Cost Savings Goals

Our healthcare costs are unsustainable – higher than our direct competitors pay, and far above the average of what other businesses pay. A recent survey by the Kaiser Family Foundation reported that employees paid about 27 percent towards their healthcare costs, in addition to whatever out-of-pocket costs required.

 

The company is seeking to make the changes necessary to hold down costs while continuing to offer competitive healthcare plans. American’s successful restructuring, and its very survival, requires us to re-think every aspect of our business, and that includes our healthcare plans.

 

Proposed Plan

The following changes apply to all independent employees (Agents, Representatives, Planners, Management and Support Staff), as well as the TWU-represented Dispatchers, Fleet Service Clerks, Ground School & Simulator Pilot Instructors, Maintenance Control Technicians, and Simulator Technicians. They are also included in the tentative agreement with APA currently under consideration by pilot membership.

 

Deductibles and maximum out-of-pocket costs have been reduced from the company’s March 15 amended plan, as have employee contributions for spouse and family coverage.

 

Contributions will be set at an aggregate 18 percent of the total projected 2013 healthcare expenses for the Standard and Core Options. Contributions will increase 1 percent each year to 21 percent of projected healthcare expenses for 2016 and beyond.

 

American originally proposed offering continued healthcare options to Part-Time employees, with a different contribution structure. For ARP and TWU, part-time employees will be offered the same medical options as full-time employees and at the same contribution rates – for themselves and their families – as full-time employees.

 

Full-time and part-time Home-Based Reservations Representatives and Level 84 Premium Services employees will only be eligible for the Core option, and will pay the same as a full-time traditional employee. If these employees choose any other plan option, employee contributions will be higher based on employee status.

 

For details on the current active medical proposal for TWU-represented Maintenance & Related and Stores employees, as well as flight attendants, please click here.

 

Summary of Changes

As part of its plan to modernize American’s healthcare system, the company proposes:

• Three Medical Options – Employees would be offered three medical options to choose from:
• Standard Option
• Core Option – Health Savings Account-compatible option
• Standard and Core Options – Employees enrolled in the Standard and Core medical options contribute an aggregate 18 percent of total projected 2013 healthcare expenses for these medical options. These contributions will increase one percentage point each year, capping at 21% in 2016. The healthcare expenses calculation for the Standard and Core options would include associated medical, prescription and administrative expenses.
• Value Option – Richer medical option offered at higher monthly contributions

All Options

• Preventative Care –100 percent of preventative care would be covered in all healthcare options.
• New Hires – New employees eligible for healthcare coverage will default to the Core option, which is the Health Savings Account-compatible medical option, for Employee Only coverage on their eligibility date, should another option or level not be elected during their initial enrollment.
• Wellness Program – All employees enrolled in the medical options will have the ability to earn incentives for participating in the Healthmatters wellness program, provided they meet the criteria established by American and provided American continues offering incentives in any plan year.

 

This is not intended to be the plan document, but rather a summary of the proposed changes.

 

You will receive a copy of the final summary plan description of the benefits once this process is completed.

 

Source:  2011 Mercer National Survey of Employer-Sponsored Health Plans – Jumbo Employers (20,000 or more employees)