Home News CSU cancels new health plan to re-sign with old provider.

CSU cancels new health plan to re-sign with old provider.

by Archives April 7, 2009

MONTREAL (CUP) – The Concordia Student Union council voted July 15 to cancel a new health plan contract in order to re-sign with its old provider, a move that could see the CSU – or the two former executives who signed off on the deal – paying almost $510,000 in cancellation fees.

Council voted unanimously to re-sign with ASEQ, who has been providing Concordia students with health coverage for twelve years. This cancels two contracts signed in March by the previous CSU executive.

Under the cancelled deals, CSU would have joined the National Student Health Network, used the Network’s broker, and Morneau Sobeco to negotiate a plan with an insurance company. NSHN is a brand name used by Canadian Federation of Students-Services (CFS-Services) to describe the schools with plans signed through the company.

The three-year contract signed with CFS-Services was invalid, because last year’s executives were only authorized to sign a one-year deal, acording to current CSU VP services Prince Ralph Osei. Although the contract for brokerage services with Morneau Sobeco is only for one year, the one with CFS-Services would have locked the CSU into using the CFS-Services’ broker for three years.

Both cancelled contracts include a clause that could require the CSU to pay $5 for each eligible student, to the respective companies, as compensation for lost income. The contract with Morneau Sobeco, which renews automatically each year, adds an additional cancellation fee of $5 per eligible student, if the contract is cancelled within the first year. This additional fee would be paid to CFS-Services

According to Osei, if the cancellation fees are requested the CSU will ask former President Keyana Kashfi and former VP finance Leroy, who signed the deals, to pay the bill.

The CSU has also argued that they shouldn’t have pay the cancellation fees because the two companies have not put in any work, a claim that has been disputed by Morneau Sobeco.

In two letters sent to the CSU in June, NSHN coordinator Tom Rowles and Morneau Sobeco principal Gerry Matlashewski wrote that both companies had put time and money into the new health plan and that they would take legal action if the plan was cancelled.

When the contracts were awarded to Morneau Sobeco and CFS-Services, some councillors – including some who were elected to the new executive – criticized the fact that ASEQ was not given a chance to bid against Morneau Sobeco for the right to broker the plan.

Shortly after taking office, the new executive began an open tendering process for a health plan contract, won by ASEQ.

According to Michelle Dumais, CSU director of finance and administration, Morneau Sobeco was invited to participate in the latest bid, but does not offer the type of plan requested by the CSU and did not respond.

Reached on Monday, July 20, Matlashewski said he was unaware that the CSU had decided to cancel the deal until he was contacted by the Concordian.

“I’ve been trying to get a hold of the CSU for the past six weeks, but they haven’t told me one thing or another,” he said. “It’s a little frustrating.”

However, Osei said the CSU has tried to contact Matlashewski on multiple occasions, but has not heard back.

The Condcordian was unable to reach Rowles or anyone from the National Student Health Network for comment. A 1-800 number provided on Monday, July 20 by the CFS head office and listed on the web sites of several university health plans, was no longer in service. The phone number in the company’s local listing in Vancouver was also no longer in service. Calls to the CFS national office and e-mails to Rowles were not returned by press time.

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