Retired National Basketball Association (NBA) players will receive health insurance throughout their lives under a players union proposal expected to be ratified by a player vote later this month.
The plan will reportedly tap $10 to $15 million per year from the players’ share of the nearly $3 billion that ESPN and TNT are paying annually for the league’s broadcast rights over the coming decade.
Many of the roughly 1,500 living former NBA players were out of the league years before the salary and endorsements explosion of the modern era. League rules mean that players are only covered for health insurance through the summer after the season in which they retire. When the league created a pension system for retired players, it initially excluded the handful of living players who’d left the league before 1965. It wasn’t until 2007 that the league extended full pension rights to that group, known as the “Pioneers.”
The health insurance idea would affect a much larger group of people who helped make the sport what it is today. Earl Monroe made it into the Hall of Fame 10 years after retiring in 1980. A few years after that induction ceremony, Monroe needed both hips replaced and had no insurance. A fellow ex-player stepped in and gave Monroe the money to pay for the hip surgeries.
Another uninsured former New York Knick named Harthorne Wingo found himself behind on rent and forgoing medical treatments he needed in 2004. The NBA has struck a partnership with a charitable doctors’ organization to try to address the needs of uninsured former players like Monroe and Wingo. But the strict cutoff on individual health insurance for retirees remains in effect.
Because the union’s normal revenues — membership dues from players and agents, and licensing money from video games and other outside-the-league uses of players’ likenesses — would likely be insufficient to furnish the insurance plan’s costs, players will have to forgo some of their share of that massive TV deal to fund the idea. Players are guaranteed roughly half of the league’s annual income tied to basketball, a category that includes stadium concessions and parking as well as ticket sales and broadcast revenues.
At current projections, the players’ half of the league’s nut will be close to $3 billion a year by the beginning of next decade. The $15 million upward estimate of the annual costs of insuring retirees is therefore a small drop in a growing bucket.
In addition to providing some economic security to the forgotten stars and sixth men of yesteryear, the players may be buying some useful negotiating leverage.
The TV deal inked last year means that the league’s salary cap will jump by almost 50 percent over the coming summers, an unprecedented jolt to the NBA’s delicate system for balancing players’ pay, owners’ wealth, and fans’ expectations of fairness on the court and relative continuity of rosters. The NBPA has already rejected the league’s first proposal to “smooth” the jump in the salary cap, pointing out that the people who actually play the games have already given up hundreds of millions of dollars under the most recent labor agreement from 2011.
Many pundits anticipate that owners will force a lockout again in two years rather than deal with the large projected jump in player pay. If there is another labor stoppage, the NBPA will hope that public sympathy for the players can steer talks in their favor. By voluntarily forgoing some of its side’s share of the league-wide revenue boom now to ensure that aging players can afford medicine and surgeries in perpetuity, the union may cut a more sympathetic figure in future labor fights.