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Article Posted December 22, 2008

Regents Take Action to Meet Additional 2 Percent Budget Cut

The Board of Regents approved a change in health-benefit plans for University System of Georgia (USG) employees as well as a temporary fee for all USG students at a special called meeting on Dec. 3. The changes will help the System’s 35 colleges and universities meet an additional 2 percent reduction in the current Fiscal Year 2009 budget.

As a result of the board’s action, as of Jan. 1, 2009, the employer contribution rate for health insurance for the System’s PPO and HMO health plans will be reduced from 75 percent to 70 percent. USG employees enrolled in these plans will thus pay increased premiums ranging from approximately $17 to $65 a month, depending upon the plan and number of individuals covered.

The employer contribution rate for the Indemnity plan will be the same as the PPO plan. The employer rate for the System’s high-deductible health plan will continue at its current level of 90 percent.

The board’s action on the USG’s health plans will result in an additional $8 million in savings throughout the System.

Effective for the spring 2009 semester, all USG students will pay a temporary, one-semester fee: $100 at research universities and six other universities, $75 at most comprehensive universities, and $50 at two-year and state colleges. The fee will offset an additional $20 million in budget reductions at the institutions.

An additional $12 million in savings will occur as a result of instructions that allow all USG institutions to defer maintenance expenditures. This budget-reduction measure initially was discussed with the regents this past August and did not require specific action at the Dec. 3 board meeting.

“These are difficult decisions,” said Chancellor Erroll B. Davis Jr. “The alternative was to compromise the quality of a USG education by continuing to reduce the courses and services that students need. The board’s action will protect the System’s core teaching mission and maintain academic quality. All must share some pain in order to maintain services and the quality students expect and deserve.”

The regents took action in August to reduce the System’s budget by 6 percent ($136 million), and also to approve contingency plans for additional reductions. Healthcare plans and the student fee were two components of these additional reduction plans.

In addition to the research universities, six comprehensive universities – Kennesaw State University, Georgia College & State University, Georgia Southern University, Southern Polytechnic State University, the University of West Georgia and Valdosta State University – will charge a $100 temporary student fee. All other comprehensive universities will charge students a $75 fee.

Posted by John Vanchella
Published in: Board of Regents

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