By Rod Hirsch

As health care costs skyrocket and companies look to limit or even cut employee coverage, offering comprehensive benefits, keeping costs well below national levels and saving money in the process seems more like a carnival elixir than a real prescription.

Yet one Union County non-profit is doing just that and has the record to prove it.

For 20 years Community Access Unlimited (CAU), an Elizabeth-based human services organization serving people with disabilities and at-risk youth, has been bucking the trend of ballooning health insurance costs and setting a standard for organizations nationwide.

“Back in the late 1980s, we had…the typical major medical and catastrophic insurance,” said Sid Blanchard, CAU executive director. When Blanchard learned CAU’s health insurance costs were poised to spike 50 percent, the typical approach went out the window.

“I said this is unacceptable. There’s got to be a better way,” he recalls.

Blanchard chose to tackle health care with the same entrepreneurial mindset he used in growing CAU from a limited venture funded by a one-year, $90,000 grant and operated out of his car to a $30 million agency with 500 full- and part-time employees. He researched health care options, consulted experts in various fields and chose to self-insure the agency in 1990.

CAU has been enjoying below-average health insurance increases ever since.

In 1999 CAU adopted a Voluntary Employee Beneficiary Association (VEBA) to further help contain costs. Established by the IRS under section 501(c)(9) of the Internal Revenue Code, a VEBA is an association created to provide life, sick, accident, and other benefits to members or their dependents or beneficiaries.

Initially CAU’s self-funded plan mirrored the benefits of a traditional plan. Today, however, the advantages of the agency’s chosen path are striking.

For example, according to the National Small Business Association, 10 percent of

small businesses are considering canceling health care coverage. Conversely, CAU offers comprehensive coverage to nearly 300 enrolled individuals and will even be adding benefits in 2010 – all with no employee premium payments.

Moreover, while a report by the Johns Hopkins University shows more than 35 percent of U.S. non-profits saw health insurance costs jump by 11 percent or more during the past year, CAU has held increases to just 3.3 percent in each of the last five years, and Blanchard projects no increase at all for 2010. The agency’s monthly cost for base coverage is about $460 for an individual and $1,150 for a family.

Furthermore, as a side benefit of controlling health care costs, CAU is able to pay

employees slightly more than most non-profits.

“We’re able to take the money that would normally pay for typical industry rate increases of 10 to 15 percent per year (and) utilize that money to invest back in our employees,” Blanchard said.

According to Eric Burckhardt, senior consultant at Meritain Health – CAU’s plan administrator and the nation’s largest independent service provider for self-funded health plans – the key to successful self-insuring and cost containment is understanding past experience and where claims dollars are going.

“You’re paying for what you use as opposed to paying for what everyone else in the pool is using,” he said. “You’re really buying (coverage) a la carte…The end user sees they have insurance coverage, but if any one component … doesn’t work or needs to be changed, we can swap in a different component.”

In short, Burckhardt notes, it is not one size fits all.

Although CAU has saved approximately $1 million in health care costs over the last five years and currently enjoys a VEBA funded to $2 million, for Blanchard the story is really about people.

“It’s a matter of caring and caring about doing the right thing,” he said, noting most of CAU’s employees are single heads of households and many are women and minorities. “The people who work here tend to be moderate-income people…Health benefits are essential.”

CAU’s success does not mean the journey has always been easy. Not only does self-funding require added effort but it also demands the courage to do something different. Perhaps this is why CAU is currently the only non-profit in the nation to employ this model.

Blanchard would not have it any other way.

“It’s the golden rule: those who have the gold make the rules,” he said. “I knew that if we were going to be effective, we were going to have to be able to control our destiny.”

By taking an entrepreneurial approach to health care, CAU has overcome powerful trends to do the seemingly impossible: meld access with affordability and provide comprehensive and expanding health benefits to employees and their families. While the rest of the nation waited for Congress, health care reform has become a reality for at least one pioneering non-profit.

Previously I have written of the three fatal flaws in designing a selling process:

   1. Assuming prospects enter conversation with serious intent – they won’t.

   2. Assuming prospects believe what we say – they don’t.

   3. Assuming prospects know how to make a decision – often they can’t,

particularly for infrequent decisions.

Management ignores these flaws at their peril.

Selling is further challenged by these self-inflicted wounds salespeople bring to the

selling process:

   1. Putting social values before business values – the major cause of salesperson failure.

   2. Refusing to accept the standard of “earning the right” to business.

   3. Operating on a “best efforts” vs. “do or die” basis.

Management and ownership too often ignore these flaws and self-inflicted wounds, itself another fatal flaw that dooms the selling effort. It’s an unintended negative consequence of proper risk management.

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As 2010 moves forward and we face another uncertain year in business, companies must equip themselves with smart practices to position themselves for greater opportunities as the year moves forward. These begin with those who lead the company. Here are four tips leaders must consider to keep performance and profit from going right back up the chimney.

Communicate with your people. In the absence of feedback, people will create their own and it’s usually negative. Your people must be informed about what is going on, why things are happening and how they contribute.

Make individual meetings a standard. The only way to truly get the best ideas and

perspectives out of people is in a trusting atmosphere. In business environments, group settings are not that atmosphere. Meeting with your folks individually, ask open-ended questions and listen. Companies are failing because they don’t practice this crucial leadership technique.

Compliment people. Do you remember how it feels when someone provides you

encouragement and positive feedback on your unique qualities? We all share the common need for appreciation. Be creative and courageous. While it’s important to state the needs for improvement and performance, be sure to express what people are doing right.

Think about a sports team that may be talented but doesn’t play with passion. They

place themselves in a far more vulnerable place, one that is susceptible to defeat. Similarly, leaders, like coaches, must find what motivates their staff members and intact teams. Doing so allows them to maximize their confidence, talent, performance and creativity.

Tapping into the motivations of your organization creates a winning energy. In a time when so many companies are operating from a place of of fear, you can differentiate yourself with a play-to-win approach because you have a motivated workforce.

Business leaders have teaching moments every single day. By what they say and do they are influencing right and wrong, ineffective decisions and smart choices. A teaching leader is an individual who realizes this. They make educating and developing those around them a priority value.

The challenge around leaders who teach is they really don’t know how to do so. Teaching hasn’t occurred until learning has been confirmed. Telling isn’t teaching. Data dumping is not educating. Executives must practice focus and patience. They must be great listeners and understand that direct reports learn in different manners. Some are analytics who require visual repetition. Others need to be shown how to do things and physically practice them.

These components of business education are integral for establishing a culture of learning, teaching and constant development. The teaching leader is a rarity because it requires an others-centered ego while simultaneously accomplishing the complex responsibilities that many organizations require.

As employees evolve into positions of management, responsibilities expand, necessitating leaders to lead people and get away from the daily tasks.

Unfortunately, many managers are either not comfortable with big picture leadership and the interpersonal requirements of higher leadership or they can’t let go because they feel like things will not get done the right way or fast enough if they don’t do it themselves.

Learning to let go is not easy, particularly for those who are high-controlled and very

organized. Yet it can be done and must be done if an individual is to go to a higher level in an organization. As importantly, not letting go can be disastrous for eroding trust and killing the motivation and development of emerging leaders.

Leaders should incrementally delegate responsibilities. In time, they’ll realize that their team members can accomplish more than they ever thought and (gulp!) can periodically do things better and faster than they can.

Letting go creates a culture of capable, talented team members who can contribute value and success to an organization from many different vantage points.

Inside Views

The recent passage of health care legislation a couple weeks back by the U.S. Senate was really touch and go. Not because the passage was ever in doubt.

The difficulty was the ability to end debate and bring the motion to a vote.

While passing a piece of legislation requires a simple majority of 51 votes, ending debate requires 60 votes. These 60 votes were only garnered by serious changes to the legislation and huge bribes to a couple of western and southern senators.

Many think this oddly called cloture rule is unconstitutional and not what our founding fathers intended.

Cloture rules which end debate, sometimes called filibuster, are a tool of the minority. They are used to prevent important matters from being decided.

While it is true that the founding fathers did not include the cloture concept in the Constitution, I think they would see it as an important and useful rule. The Constitution was designed to provide checks and balances.

Its intent was to ensure that studious effort went into any decision, and that compromise was achieved. The thought of ramming something through would have been abhorrent to its framers.

The tyranny of the majority was a key concept to Alexander Hamilton and James Madison, the two major intellects behind the Constitution. They understood that for a democracy to succeed, the rights of the minorities had to be protected from the passions of the majority.

In fact, the Senate was set up primarily to ensure this. At the time the Constitution was written there were 13 states. Some like Virginia and New York had large populations. Others like Rhode Island and Vermont did not. The small states needed protection from the large states and a body that equally represented all states

would offset the power of population as represented in the House of Representatives. The Senate was to be another check on the passions of a majority faction.

Okay, so why wasn’t this enough? Why did someone come up with the idea of the filibuster and later the concept of cloture to bring filibusters to an end?

What Madison and Hamilton did not foresee was the ascendency of political parties, at least when they were framing the Constitution. Parties are by definition factions. Their power is their ability to get their members elected and then control them once they are in office. In this country for some reason we have always had two major parties, meaning a majority faction and a minority faction.

Interestingly, when Hamilton started running the government (he was Secretary of the Treasury in Washington’s administration), he did an about-face and created the first faction which ultimately became the Federalist Party. He did this so he could ram his agenda through Congress. Thomas Jefferson, his arch enemy, founded the Democratic-Republicans with James Madison to stymie Hamilton and push his own agenda.

Filibusters came along in the 1840s as a way for the minority to stop the majority from doing what it wanted. The idea of closing off debate, i.e. ending a filibuster, was a new rule added during the Wilson administration. Back then, it took 67 votes to end a debate.

The legislative strategy of using debate to prevent action is as old as this country. It has often been used to prevent or delay very admirable pieces of legislation. One of the most effective filibusters was Senator Robert Byrd from West Virginia using the technique in an attempt to prevent the passage of civil rights legislation by a coalition of northern Republican and Democratic senators.

More recently, when the Senate was controlled by Republicans during the Bush administration, there was a lot of talk about reforming the system of cloture. At that time the minority Democrats were using filibusters to block judicial appointments and prevent an earlier attempt at health care reform known as association-based

health plans.

So pray that we keep the present system. The health care bill that finally passed is a lot better than it would have been without cloture. You may not always get what you want, but this system prevents the tyranny of the majority.

James Coyle

President

There are many lessons to be learned from the economic crisis that has beset this nation over the past two years. We can all agree that one of those lessons is that the current consumer protection regulatory regime has failed. The current regime is too siloed and too territorial to ensure the safety and soundness of our financial institutions and ensure that American consumers are not taken advantage of by unscrupulous participants in the industry.

The disagreement between Republicans and the Democratic majority in the House of

Representatives is not over whether we should revamp our consumer protection regulatory regime, but over how we do it.

The Democrats in Congress recently took an anti-business and “government knows best” approach to this problem in approving legislation that could ultimately harm small businesses, slow job creation, reduce choice for American consumers and set back efforts to get our economy back on track.

The legislation would create a new federal bureaucracy called the Consumer Financial Protection Agency. While the name sounds good, a book should not be judged by its cover.

The majority’s approach would create a new unwieldy federal agency with authority over almost every consumer transaction involving a financial services company, loan or credit card in the United States. It would be headed by an unelected director with nearly unlimited power.

I wholeheartedly support revamping and strengthening the consumer protection regimes that oversee the financial sector but oppose the creation of an entirely new agency to accomplish this. The new consumer protection agency could ultimately do more harm than good to consumer credit, a component of our economy that is critical for economic recovery.

Creation of a new agency could harm the creation of small business in New Jersey, a state that is already experiencing one of the worse business climates in the nation with high taxes and excessive state regulations.

Scores of New Jersey small business owners have told me that this new agency would personally harm them. Gail Rosen, a CPA from Martinsville, recently said, “New Jersey small businesses are still struggling to access the credit they need to start, maintain and grow their businesses and the jobs they create. A new and massive federal agency like the CFPA will only cause further reductions in the availability and affordability of credit, which couldn’t come at a worse time.

Congress should work towards an alternative that will uphold consumer protection without harming New Jersey small businesses.”

The approach I supported, offered by the Republican minority on the Financial Services Committee, would create a new council of the existing prudential banking regulators and statutorily increase the regulators’ mandate for consumer protection. Apart from creating a new bureaucracy, the Democratic plan separates consumer protection regulation from the examination of the safety and soundness of our financial institutions. This would be a serious mistake. Our approach would ensure that these two important responsibilities are examined together. Only then can both truly be done effectively.

A study by the U.S. Chamber of Commerce found that the new agency would further

exacerbate the credit crunch for small businesses:

We can and must protect American consumers from the bad actors but we don’t need a new federal agency to do it.

Berkeley College made a $1,460 contribution to the Food Bank for Westchester to help those in need this past holiday season. The donation is given annually by the school’s Westchester Campus. Presenting the check to Christina Rohatynskyj (right), executive director, Food Bank for Westchester, is Cynthia Rubino, Berkeley College campus operating officer, Westchester Campus.

Infineum USA L.P. recently was honored by the New Jersey Committee for Employer Support of the Guard and Reserve, an agency of the Department of Defense, with an Above and Beyond Award in recognition of the support the company provides to colleagues who serve in the New Jersey National Guard and Reserve. The award publicly recognizes American employers who provide outstanding patriotic support and cooperation to their employees serving in the National Guard and Reserve. An Infineum employee currently on duty overseas nominated Infineum.

John Englishman, Infineum Bayway Chemical Plant manager (center) accepts the Above and Beyond Award from representatives of the New Jersey Committee for Employer Support of the Guard and Reserve.

Union County College (UCC) recently announced that Dr. Thomas Brown will be

retiring as president and that Dr. John Farrell, Jr., vice president of administrative services and executive assistant to the president, has been named interim president. Farrell began his career at UCC in 1965. During his tenure he coordinated and directed the college’s move from the Scotch Plains campus into the newly acquired Sidney F. Lessner Building in Elizabeth. He holds an Ed.M. and an Ed.D from Rutgers University.

Employees at the law firm of Lindabury, McCormick, Estabrook & Cooper P.C.,

treatment center.

Trinitas Regional Medical Center recently broke ground for the new Center of Regional Education (CORE) building in Elizabeth that will allow Trinitas to create a state-of-the-art training facility for anyone seeking health, wellness and medical information, and professional training in the field of emergency response. Designed as a multipurpose center, the CORE building will provide assembly space for community events, classroom space for health education and facilities for paramedic and emergency medical technician (EMT) training. The building will also be home to the offices of the Trinitas Health Foundation and the medical center’s mobile intensive care unit and ambulance services. The building will be completed in early 2011.

In addition, Ronald McDonald House Charities of the New York Tri-State Area recently made a significant donation to Trinitas Regional Medical Center for construction of a basketball court for the Residential Treatment Center at the medical center’s New Point Campus in Elizabeth. Additional funds from the same grant were used to purchase computers, monitors and printers for use in the Child InPatient

Psychiatric units.

Gary Horan, Trinitas president and CEO, accepts the donation from Elke De La Cruz (left), owner/operator of several McDonald restaurants in Union County (left), as Yvonne Lopez, director of donor relations at Trinitas Health Foundation, looks on.