[Newark NJ – April 1, 2016] Effective today, April 1, Newark Teachers Union (NTU) members have moved to a new prescription benefits provider, Benecard. NTU members have joined all other employees in the district who began coverage under BeneCard in February 2016.
In making this transition, Newark Public Schools (NPS) has one primary objective – to provide a prescription program that offers benefits that are equivalent to or better than the previous provider at a lower cost to Newark’s employees. NPS is working with all parties involved to ensure as seamless a transition as possible to the new plan and to make sure that the benefits offered are indeed equivalent or better than those previously provided.
Employees will enjoy some of the following benefits under the new BeneCard plan:
- Employees will have access to more pharmacies with BeneCard, with the network increasing from 50,000 to 63,000 locations
- All employees now have the opportunity to obtain a supply of medications via BeneCard Mail Service Pharmacy and can choose to have medications mailed directly to their home
- Employees will not see an increase in their co-pays as it relates to brand and or generic drugs. However, if the medication cost is under $5.00, employees will pay the lesser amount
- NTU members now have access to BeneCard’snational toll free number that is available 24/7/365 to answer all inquiries
The district, which is facing a large projected budget gap, is routinely looking for savings that will not directly impact schools. As a result, the district reviewed the existing General Prescriptions Program, Inc. (GPP) prescription coverage, which had not changed in over 20 years. After an in-depth analysis of other alternatives, the district selected BeneCard, which is estimated to save the district at least $1.1 million a year and guarantees equal or better benefits for employees. All other district employees were able to move to the new plan on February 1st.
“It is common for employers to, from time to time, change providers to get better services and to incur savings. Our first goal was to ensure that any new plan would provide our employees with high quality benefits that are at least the same as, and in some ways better than, those they had experienced in the past. Under BeneCard, employees can now fill their prescriptions in 13,000 additional locations and have prescriptions mailed directly to their home,” said Larisa Shambaugh, Interim Chief Talent Officer at NPS. “At the same time, employees will experience no increase in their co-pay, and may even pay less if the medication costs less than the co-pay. We saw this as a clear win for our employees and the district.”
On March 16, 2016, the Superior Court of New Jersey ruled in favor of NPS to allow the district to move all NTU employees to BeneCard, effective April 1, 2016. This decision came after a challenge from the NTU regarding the district’s authority to change benefits plans for employees without the approval of a joint entity—the Supplemental Fringe Benefits Fund (the “Fund”)—that was established between NPS and NTU over 30 years ago. For years, NPS had difficulty obtaining exact information from the Fund about who the district was covering and how their $18 million billed to the district each year was being spent. NPS tried on multiple occasions to involve the Fund in the decision to change prescription providers; however, they refused to engage in any discussions at the direction of the trustees appointed by the NTU. Ultimately, the Superior Court of New Jersey agreed that the district has the sole and final authority to change healthcare plans. Furthermore, in the midst of the court proceedings requiring documents from all parties, GPP—the NTU prescription benefit provider—chose to voluntarily withdraw their services with the district and end their long-standing contract.
Superintendent for Newark Public Schools Christopher D. Cerf reacted to the ruling, noting, “Effective today, all Newark employees will have access to high quality coverage under our new prescription benefits provider, which we are confident will result in savings for our employees and the district as a whole. The district has our employees’ best interest in mind, and I am committed to working with the Newark Teachers Union and our employees to ensure this new benefits program works for everyone. I hope that the Superior Court’s ruling brings the Newark Teachers Union to the negotiating table, rather than the courtroom, so that we can work together to find common sense solutions to solve our budgetary constraints.” Continued Cerf, “It is worth reminding the union’s president, John Abeigon, that a savings of over a million dollars a year means protecting the jobs of at least a dozen of the educators he represents, and the potential savings from creating responsible financial controls on this $18 million annual expense will help us protect many more.”
All NTU staff have been notified of the decision and will receive new prescription cards. Employees are encouraged to reach out to NPS central office or utilize BeneCard’s toll-free number with any questions they might have.