Dues could go up again following today's USARFU board meeting, as a result of insurance claims that continue to outstrip the union's medical policy.
Chief executive Nigel Melville last week pitched another $10 increase as one of three options for the growingly expensive program, in a memo circulated to the union's congress. The 27-person body, whose archaic structure excludes formal representation of college or school-age rugby, must approve any dues hike. The prospect was first reported by This is American Rugby.
After a year of aggressively marketing voluntary coverage, Boulder in 2011 converted insurance to a component of its mandatory Club and Individual Participation Program (CIPP) membership package. A corresponding $10 across-the-board price rise initially exceeded the cost of USARFU's medical premium by approximately 35 percent, but last year the surplus was entirely absorbed, deductibles were increased, and further Boulder was forced to add a coinsurance clause limiting carrier payouts.
Although the national office actively lobbied American rugby players in an effort to sway the congress, the program has remained controversial because the premium costs approximately 10% percent of the union's revenue, while mainly acting as secondary coverage.
The cost of the USARFU's premium for the 2013-14 season could top $1 million, according to people familiar with the matter. The union reported 2011 revenue of $7.5 million, though 2012's not-yet-published total could have exceeded $10 million. In both years, dues comprised more than 40 percent of the union's intake.
Increasing dues again could enable the union to match 2011-12's deductibles: $1,000 for those with primary insurance and $2,500 for those without. But the policy would not cover out-of-pocket expenses from primary insurance, as it originally did. Additionally, the union would retain the '80/20 coinsurance' provision added in 2012-13, meaning the registrants would pay 20 percent of covered costs after the deductible has been met.
Claims look to have decreased this year, though the total won't be known for some time as the policy covers treatment up to one year after the date of injury, meaning any accidents sustained this month could be paid out through August 2014.
Melville's stated alternates to increasing dues are to raise the deductibles of the current policy, or to drop the program, thereby enabling players to keep hold of approximately $1.2 million. The union could also restore insurance to a voluntary basis.
The decision takes place as the federal government's Affordable Care Act is slated to come online in January 2014, 6 months from now. The Obama administration initiative requires individuals who are not insured by an employer or public insurance program to purchase an individual policy, or pay a fine.
Adding insurance was touted as attracting tens of thousands more players to rugby, helping USARFU toward its goal of 136,000 registrants by the end of 2012. But approximately 90 percent of accident claims are by players with primary coverage, and the union claimed just 115,000 members are the end of last year, suggesting the program has not lured new athletes.
While many other sports bodies offer insurance, another, less well-advertised reason for mandatory insurance is mitigating liability claims against USARFU, the union acknowledged in a 2011 circular.
It's likely that dues payers overlook the marginal costs of the organization's medical and liability policies, but dues are a different matter. Raising them could cause some backlash.
Separately, the board may discuss the upcoming departure of chief marketing Pam Kosanke and director Matt Hawkins, who has been named coach of the 7s national team, and hear a report on the recent 7s World Cup in Russia, which was a commercial flop. The union has stated its intention to bid on the 2018 event.