FacSen discusses Meyer, healthcare

Feb. 18, 2011, 2:02 a.m.

The Faculty Senate convened Thursday afternoon to discuss three topics: the possibility of a New York City campus dedicated to engineering and computer science; the impact of the Health Care Reform Bill on faculty and staff members and the future of the University’s libraries.

Vice President for Business Affairs Randy Livingston and Professor of Medicine Arnold Milstein presented a report the legislative impact of the health care bill, placing the emphasis on the rising costs of health care.

Livingston said the University currently offers five health plans to employees and their dependents: Kaiser, PacifiCare, Health Net, PPO and HDHP PPO.

“The costs have been rising quite dramatically,” Livingston said, referring to the fact that the compounded annual growth rate (CAGR) is between 12 percent and15 percent.

“What health care reform, at least for us, does is introduce a number of elements that will actually, in short run, add a burden of additional costs,” Livingston said.

One such burden stems from an increase in the number of people covered. Stanford will see approximately 400 dependents added to its health care roll this year since the Health Care Reform Bill allows children to be covered under their parents’ plan up to age 26.

In addition, some of the bill’s costs are directly borne by individual faculty and staff members. For instance, faculty and staff are no longer entitled to get reimbursement for over-the-counter medication, and health spending accounts are capped at $2,500. The health bill further includes a special excise tax on certain health benefit plans, effective 2018.

According to Livingston, the University will concentrate on the dual objectives of improving the health of employees and dependents and slowing the growth of healthcare costs.

Milstein said two initiatives, the Be Well Program and preventative care, are in place to address the first goal. He also expanded on the idea of a Stanford-based Care Management Program. One central component of this program is an A-ICU that provides intensified care for the10 percent of the insured who are most fragile.

Milstein also sees a role for Stanford Hospital & Clinics (SHC) and the Lucile Packard Children’s Hospital (LPCH) within this framework. In combination, these efforts could effectively reduce long-term health care costs and improve the health of Stanford faculty and staff.

With regard to cost control, Livingston cited several considerations and potential solutions.

“We’ve really come to the conclusion that Health Net and PacifiCare are no longer effectively doing managed care,” he said, noting that the University may drop these two plans in favor of a new self-insured plan.

“We’ve really come to the conclusion that Health Net and PacifiCare are no longer effectively doing managed care,” Livingston said.

Adding to the problem is the fact that Kaiser doesn’t really have competition and “manages under the umbrella of the costs” of the other plans, he said.

Following the health care discussion, University Librarian Michael Keller and John Bender, professor of English and comparative literature, reported on the future of Stanford’s libraries.

According to Bender, the University discovered in the fall of 2007 that Meyer Library had to be demolished “for reasons of earthquake safety.” Meyer currently houses academic computing, a large number of library staff and, most importantly, the East Asia Library (EAL).

This revelation of Meyer’s seismic unsoundness led to the creation of the Marrinan Subcommittee, which was tasked with investigating the future of the East Asia Library. A second subcommittee, known as the Sommer subcommittee, convened early in 2009 to look into the proposals put forth by its predecessor.

According to Bender, the Sommer subcommittee recommended that Stanford maintain a substantial collection of physical books on the Farm, build a new library to house EAL and invest in the digitalization of its resources, among other things.

But two developments coinciding with the Sommer investigation have expanded the University’s options with respect to its libraries. The first was the construction of Stanford Auxiliary Library 3 (SAL3). The second was the announcement that the Graduate School of Business would vacate GSB South.

GSB South has since been put forth as a potential new home for EAL. Provost John Etchemendy said a cost-benefit study is currently underway.

“We haven’t made a decision about whether the contents of Meyer will in fact go into GSB South,” Etchemendy said. “Yes, we spent $1 million [to study the options]…to make sure we don’t make a mistake.”

Tentatively speaking, the cost of transferring the contents of Meyer to GSB South may “be on the order of $50 million,” he said. The timeline for the decision of the future of the library is six months into the future. The construction of another building to house EAL remains a possibility.

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