This is Part 3 of my review of UCF teacher benefits. If we want to attract, retain, and reward Great Teachers, we need to have competitive compensation, and benefits is a key part of the compensation package. In Part 1, we found that access to benefits at UCF is very good. In Part 2, we found that the quality of UCF benefit plans are very competitive as a whole.
As the cost of benefits has increased over the past decade, employers have passed a larger and larger share of medical, dental, and other premiums on to its employees. In today’s post we will look at the share of benefits expenses that are passed on to our UCF teachers, and compare this against national averages.
Cost of Medical Plan
The collective bargaining agreement requires UCF to pay 90% of the medical insurance premiums and prescription drug plan for all covered family members. How does this compare to the market?
Looking at market data from the Kaiser Family Foundation below, we see that the typical large firm pays 84% of single coverage premiums, and 79% of family coverage premiums.
Using average premiums from KFF’s data, we can calculate that UCF single teachers contribute approximately $600/yr less than a typical large company employee, and teachers electing family coverage pay $1,000/yr less.
Data from the U.S. Bureau of Labor Statistics provides additional comparisons. This data shows that UCF’s 90% share of medical premiums is higher than the average national K12 district, especially for family coverage (90% vs. K12 average of 67%). So UCF’s cost-sharing arrangement on medical benefits is above average for single coverage and significantly better than average for family coverage.
The collective bargaining agreement requires UCF to pay 90% of the dental insurance premiums for all covered family members. How does this compare to the market?
Broad market data on dental plans was more difficult to find – no data from BLS. However, I did find the survey results below from an employee benefits advisory firm (savitz.com). This survey shows that the typical employer in 2012 paid 63% of the single coverage dental premium, and 56% of the family coverage premium.
The other benchmark that I have is my own company, which is not only a very large company but also the #2 provider of dental insurance in the USA. We use our own company’s dental insurance plan, and the company pays 51% of the total premium to cover my family.
So compared with the Savitz data and my own experience, UCF’s share of dental insurance premiums is well-above market. This saves UCF teachers approximately $100/yr for single coverage and $390/yr on family coverage.
The collective bargaining agreement requires UCF to pay 90% of the vision plan premium for all covered family members. How does this compare to the market?
My market data for this benefit is pretty thin. I was unable to find any survey data, but I did find several large company plans that did not require employee contributions. (My own company offers a 100% company-paid vision plan, too). Most companies do not offer a vision plan at all. So if companies cannot afford to pay 100%, they probably choose not to offer the benefit. Has anyone ever declined a job offer because the company doesn’t have a vision plan?
If we assume that the average company pays, say 95%, then UCF’s plan might cost teachers an extra $15/yr (single) or $40/year (family). Not a big deal, but below average.
Disability Income Protection Plan
The collective bargaining agreement requires UCF to pay 100% of the disability income protection premium for employee-only coverage. How does this compare to the market?
Market info from BLS tells us that 22% of K12 schools require some level of employee contribution toward this benefit. However, the data does not provide the percentage of the premium that employees are required to pay.
We can determine that UCF pays an above average amount, and we can guess that this benefit saves UCF teachers 10% of the annual premium, or approximately $30/year.
The collective bargaining agreement requires UCF to pay 100% of the life insurance premium for employee-only coverage. This is typical of large employers, at least up to 1X annual salary in coverage. So UCF’s share of life insurance premiums is average.
Overall, UCF pays a larger share of benefits costs than most employers. This provides extra value to UCF classroom teachers, and enhances their total compensation. Adding up each of the benefits, I estimate that a single teacher electing all benefits contributes $700 less toward benefits than an employee at a typical large company, and a teacher with a family contributes approximately $1,400 less.
- UCF pays are larger portion of insurance premiums than most large employers
- As a result, UCF teachers contribute between $700 – $1,400 less than might be typical at other large employers (depending on family size and coverages selected)
- As a percent of average base pay, this is equivalent to a 2-3% boost to pre-tax pay.
- This helps UCF attract and retain Great Teachers