With possible state funding cuts looming and forcing the university to enact cost-cutting methods, MSU President Lou Anna K. Simon has prescribed health care costs as a potential cure for MSU’s financial woes.

During her State of the University address on Feb. 3, Simon announced the creation of the Health Care Strategy Advisory Committee, which was assigned the task of making MSU’s health care system more fiscally sound.

The committee is comprised of representatives from faculty, various staff unions, retirees and academic specialists.

“Our approach must strike the right balance between quality and cost,” Simon wrote in a letter to faculty and staff last month. “We must maintain access to high quality care while constraining expenses to achieve greater value. A sustainable approach will likely require shared sacrifice. It would be dishonest to suggest otherwise.”

In 1970, health care represented less than 1 percent of MSU’s general fund budget. It now accounts for about 7.5 percent of the budget. If costs continue to rise at current rates, by 2019, one-tenth of the university’s spending would go toward health care.

MSU uses a self-funded method for providing health care, meaning the university pays for staff members’ health bills, minus any co-pay.

Brent Bowditch, assistant vice president of MSU human resources, said the new health care committee will look for data and fact-supported changes that could help limit health care cost increases.

“The things that we want to do should really be based on research and it shouldn’t be, ‘Well, it sounds kind of good’,” Bowditch said.

“It should have backing by research. For example, in the wellness area, we know that if we can get people to stop smoking, that has a big payoff. If we can get people to exercise, that has a big payoff.”

Marilyn Wilson, a professor of English and writing, rhetoric and American culture, said she is concerned that changes to the current health care system could raise costs.

“I think a concern is whether the university is going to continue to support the health care for the program that exists because of difficult financial times,” she said.

“Certainly there may need to be larger co-pays for faculty — there may need to be limitations of benefits so obviously there are concerns for all.”

In her address, Simon said limiting health cost increases to 5 percent per year would allow the university to reduce every student’s tuition by $1,000 per year.

Provost Kim Wilcox said much of the problem with limiting health care costs is balancing cost effectiveness with quality care.

“Money we spend on health benefits is money we can’t spend on other things,” Wilcox said. “We want to take the very best care of our faculty and staff health, but we also want to be as cost effective and efficient with every dollar that we can.”

Along with retirees and faculty, the other group involved in health care negotiations and brainstorming is the MSU Coalition of Labor Organizations, or CLO, which includes various staff unions on campus.

The CLO’s current health plan was agreed to in 2005 and expires at the end of 2009. Bowditch said negotiations for a new CLO contract will begin in July. He said the CLO will take into consideration the findings of the strategic advisory committee.

“The goal is to have, by June at the latest, an idea of the kinds of things that we should be looking at as we propose and look at new health care plans for our 2010-11 and going forward,” he said.