The Board of Pensions of the Presbyterian Church (U.S.A.) is expected to vote in early March on proposed changes in its medical benefits plan that critics say may make the coverage too costly.
Opponents say younger ministers with children could be especially hard-hit by the proposed changes in the dues structure. If approved, the changes would take effect in January 2014.
In a recent webinar, Board of Pensions representatives made the case for the adjustments. They said that without them, given rising health care costs, the benefits plan would fall about $28.6 million short of its funding need in 2014.
Patricia Haines, the board’s senior vice president for benefits, said in the webinar that the financial crunch “has now finally reached an unsustainable level,” with fewer congregations and fewer members paying into the plan, and with an aging membership. About half the denomination’s designated and installed Presbyterian ministers are at least 55 years old.
There has been, however, considerable backlash to the proposal, which the Board of Pensions first publicly presented in October at a meeting in Hilton Head, S.C. and is referring to as the “dues plus” plan.
The flap also comes at a challenging time for the board. Its top two leaders – President and CEO Robert W. Maggs Jr. and Executive Vice President and Chief Operating Officer Francis E. Maloney – both have announced they will retire in 2014. And some Presbyterians remain incensed at the board’s decision to begin offering benefits to same-gender partners, a change that took effect in January 2013.
Shifting costs. The new proposal for changes in the dues structure for the board’s medical plan has drawn some cutting criticism – focused most intensively on a recommendation to shift more of the cost of dependents’ premiums to the participating members.
The current structure sets member dues at 21 percent of effective salary, through which coverage is provided for both for a member and his or her dependents. The proposal would drop the mandatory dues to 19 percent of effective salary beginning in 2014, but would only cover 65 percent of the cost for dependent coverage. The coverage for partners and children would be optional – and the additional 35 percent of cost would be paid by the employer, the plan member, or a combination of the two.
In a “frequently asked questions” document, the board estimated the cost for dependent coverage would be about $475 per month for both a partner and children, or $5,700 a year.
That proposed structure has drawn fire from teaching elders who contend that it shifts too great a financial burden to young pastors with families – many of whom are already struggling to find churches that will hire them (the number of ministers seeking new calls far exceeds the number of congregations looking to hire ministers) and to pay back student loans.
The proposal provoked a flurry of online discussion and angry blog posts – for example, one on the StayPC(USA) website with the provocative title “Board of Pensions Plans to Eat its Young.”
Carol Howard Merritt has written and here in the Christian Century about what she describes as a “young clergy crisis” – with many young ministers unemployed or dropping out of ministry, and older ministers delaying retirement.
And James Kim, a pastor in Seattle, tweeted this: “The Board of Pensions of PC(USA), I hear ya loud and clear. You don’t want young pastors and you want to punish wee kirks. Got it.”
Some have also raised questions about whether the Board of Pensions should be required or at least encouraged to get General Assembly approval for making the kinds of changes it is considering.
The discussion surrounding the “dues plus” proposal is partly financial. The Board of Pensions has laid out the fiscal realities – familiar, in some ways, to many who have seen their pension and health care benefits eroded in the private sector as well, with costs increasingly shifted to employees. For five years, the Board of Pensions held its dues steady while medical care costs increased, Haines said during the webinar. To cover the real costs for all members and dependents, dues would have to rise to 25 percent of effective salary in 2014, with further increases after that, she said.
The financial difficulties are unrelated to the earlier controversial decision to extend benefits to domestic partners, Haines said – adding that as of Jan. 1, only about 26 domestic partners had enrolled for medical benefits under the plan. A driving force is rising health care costs, she said – adding that PC(USA) pensions officials have been in touch with their counterparts in other denominations, “and they all report feeling the exact same pressure for many of the same reasons,” she said.
Connectional church. The response from within the PC(USA), however, has centered not just around money – but on the impact the proposed changes could have on younger ministers, many of whom already feel financially pressured, and on a denomination already struggling with a climate of loss. There are fewer congregations, fewer Presbyterians, evangelicals leaving for other denominations, and budget cuts all the way from the top of the denomination to the smallest church.
And what are the theological underpinnings of the medical plan of a connectional church?
John Fife, a former General Assembly moderator, and Deborah Fortel, who led an Advisory Committee On Social Witness Policy team which wrote a report on pay equity in the church, wrote a letter to mid council executive characterizing the “due plus” change as “counter to the values” of the Presbyterian Church (U.S.A.). The letter said the changes “may well exacerbate existing divisions in the church” between those who have dependents and those who don’t, and between those earning more lucrative salaries and those barely getting by.
The Board of Pensions medical and pensions plans were set up in part to have a community nature and to be “call neutral,” one implication being that ministers could serve congregations around the denomination as called by God, without changes in their coverage. Now, many congregations are small and struggling, with some unable to afford full-time ministers and relying instead on retired pastors, stated supply or commissioned lay pastors.
If “dues plus” is approved, either the congregations or the ministers will have to pick up more of the cost of coverage for dependents and partners – a cost that, in the current economy, neither can do without some pain. Some speculate that the “dues plus” structure could come into play when a church was deciding who to call – particularly if a candidate without dependents might seem less expensive to hire.
The proposal also has generated discussion about the pay disparities between large-church pastors and those of much smaller congregations – in a denomination in which more than half the congregations have fewer than 100 members.
“While our church is working to establish 1,001 new worshipping communities, these new worshipping communities are often ministering to the people who are most in need of the outreach, but often least able to financially sustain pastoral leadership,” wrote Stephanie Sorge Wing, a minister who served on the PC(USA)’s Special Committee to Study the Nature of the Church for the 21st Century.
“The disparity of salaries between ministers at ‘large steeple’ churches and the rest of us is huge, even if education levels and years of experience are the same,” Sorge Wing wrote in her blog. “There is still a wide pay disparity between men and women, and between white, non-Hispanic pastors and pastors of other races or ethnicities. For a church that prides itself on being `connectional,’ we are full of inequalities that reflect both changing realities and institutional injustices.”
Sorge Wing helped organize a petition drive, asking the board to continue to pay fully for dependent coverage in the medical plan. As of late January, more than 750 people had signed the petition.
The Board of Pensions is expected to vote on the “dues plus” proposal at its March 7-9 meeting at the Ritz-Carlton Hotel in Philadelphia.
