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January and February 2015 Insurance and Benefits Management.

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Presentation on theme: "January and February 2015 Insurance and Benefits Management."— Presentation transcript:

1 January and February 2015 Insurance and Benefits Management

2  Insurance provided to employees is determined by Collective Bargaining with the Unions ◦ TALC Article 14, SPACL Article 13 ◦ Board Contribution (a.k.a. “Board Flex”) $6372 per year ◦ Board Paid Life Insurance - $20,000  Insurance Task Force (TALC 14.09, SPALC 13.09) ◦ Representation  8 Union Representatives (4 TALC, 4 SPALC)  8 Management Representatives ◦ Purpose: to review current insurance programs and to explore alternatives, improvements, changes, and specifications to the existing insurance programs. ◦ Meets monthly

3  RFPs (Request for Proposals) ◦ Draft RFP with specifications for the insurance being sought. ◦ Release RFP to vendors. ◦ Vendors provide responses. ◦ Responses are evaluated by ITF Subcommittee. ◦ Recommendation is taken to the full ITF Committee. ◦ ITF recommendation is taken to the Board. ◦ Board takes final action to award the contract. ◦ I&B implements plans selected.

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7  Dental: Humana ◦ Same plans, HMO: same rates, PPO: 3% rate increase  Vision: Avesis ◦ Same Plan, 1.3% rate decrease  Cancer and Other Specified Disease: AllState ◦ Same plan options, same rates ◦ Evidence of Insurability (EOI) form REQUIRED if making any changes.  Life Insurance: Minnesota Life ◦ Same plan options, same rates ◦ Evidence of Insurability (EOI) form REQUIRED if making any changes.

8  Disability: Reliance Standard ◦ Same plan options  Short Term Disability (14-day or 60-day elimination)  Long Term Disability (90-day or 180-day elimination) ◦ Rates for Long Term and 60-day Short Term remain the same. ◦ Rates for 14-day Short Term increase 20% ◦ Disability is calculated based on age and current salary. ◦ Evidence of Insurability (EOI) form REQUIRED if making any changes.

9  Flexible Spending: WageWorks ◦ Adjudication of claims is industry standard and will continue. This protects both the employee and the District. ◦ No cost to the employee to participate ◦ Employee elects amount to be set aside for qualified expenses. ◦ IRS increased the annual maximum contribution to $2,550. ◦ Requires Annual Election

10  New Vendor: Aetna effective April 1, 2015  New Onsite Representative – Kim Murphy  Two current plans (Plan 5773 and Plan 3769) ◦ Same coverage ◦ Same rates  New Plan Option: High Deductible Health Plan with a Health Savings Account.

11  Fill current prescriptions NOW with Florida Blue! ◦ Filled at the 54 day mark ◦ Receive 90 days of medication ◦ 130+ days (4+ months) of medication on hand  New prescription drug provider: Aetna Rx  File Transfer of current prescription from Prime to Aetna Rx  Ineligible transfers ◦ Certain medications legally prohibited from transfer ◦ Expired prescriptions ◦ Prescriptions with no more refills  Mandatory Generics, mandatory mail, etc. still applicable  Maintenance Options ◦ Aetna Rx Mail Order ◦ CVS Option  Mandatory mail prescriptions available for pick up at CVS  90 day (3X) supply  2X copay

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13  Different “plan type” than what has been offered by SDLC in the past.  It is like a 401K for medical needs ◦ Money is put aside pre-tax. ◦ Employer (District) money is added to the account each pay period. ◦ Money is withdrawn tax-free for qualified expenses.  IRS determines which expenses are “qualified”.  Same list as the Flexible Spending Accounts.  Eligible dependents are defined by IRS, NOT the health plan.

14  Must meet deductible for all services, including Rx, except in-network preventative care, before benefits apply.  You pay Deductible/Coinsurance for all services (including Rx) except preventative care.  NO COPAYs APPLY for any services, including drug copays. Members are responsible for the full cost of the Aetna contracted (discounted) rate.  Employees with Family coverage (covering at least one other person on the plan) must meet the FAMILY deductible before any benefits are payable for non-preventative services.

15 To be eligible for an HSA, you:  Must be covered under a high deductible health plan.  Must have no other health coverage.  Must be 63 or younger to enroll.  Must not be enrolled in Medicare (EE or dependents).  Must not be claimed as a dependent on some else’s tax return.  Must not have a standard (or full purpose) Flexible Spending Account (FSA) or HRA. AND  Your spouse must not have a full purpose FSA.

16  Plan 3769 and 5773 are the same plan at the same rates for the next plan year. ◦ District Contributes $6372 per year ($ per pay) toward employee medical premiums.  If HDHP/HSA is elected, employee still receives the $6372 per year, but split between premium and the HSA.  $4, toward premium ($ per pay)  $ into the HSA ($61.85 per pay)

17  In-Network Deductibles (Employee/Family) ◦ 3769 Plan: $500/$1,500 ◦ 5773 Plan: $1000/$3,000 ◦ HDHP Plan: $2,500/$5,000  Out of Pocket Maximums (Employee/Family) ◦ 3769 Plan: $3,000/$6,000 ◦ 5773 Plan: $4,000/$8,000 ◦ HDHP Plan: $6,250/$12,500  Maximum HSA Contribution (2015) ◦ $3,350 Individual (employee only) ◦ $6,650 Family (employee + anyone)

18  Employees can use only the amount in their account at the time of service.  Owned and controlled by employee, portable, not forfeited, at termination, or if you change medical plans. Employee decides how to invest and spend the money. ◦ Pay for current qualified medical, dental and vision expenses. ◦ Save for future medical and retirement health care expenses that won’t be subject to federal tax.  Accumulated HSA funds rollover  Triple tax advantage ◦ Contributions (individuals/employers) are tax exempt ◦ No taxes on qualified withdrawals ◦ No taxes on account interest and earnings

19  Currently,$ per check is added to your check under the “Board Flex” code.  Medical, Dental, Vision, and Cancer Insurance are deducted pre-tax.  Life Insurance and Disability Insurance are deducted post-tax.  If you elect the HDHP/HSA, your paycheck will look different. ◦ Board Flex will be $ (instead of $265.50) ◦ The balance of the Board Contribution ($61.85) will be a new row titled “HSA” under “Employer Paid Benefits” box

20 TiersPlan 3769Plan 5773 High Deductible Health Plan (HDHP)** Employee Only$272.70$255.96$ Employee / Spouse $660.33$618.21$ Employee / Child $409.70$384.00$ Employee / Children $574.56$538.06$ Employee/ Family $832.43$779.04$707.17

21 Employee Only - Low Cost Scenario Service # of Services Covered Amount Total Cost 2015 Employee Cost HSA HSA Fund $0 $1,484 Preventive Visit (Well Adult)1$220 $0 PCP OV (sick visit)1$100 $25$35$100 Specialist OV1$160 $60$85$160 Generic - Retail1$25 $0 $25 Brand Formulary - Retail2$110$220$50 $220 Employee Subtotal $725$135$170$505 HSA Used $505 Total Employee OOP Expense $725$135$170$0 Annual Premium $173$0 HSA Balance $979 True Employee OOP Cost with Premium $308$170$0 Assumes services are in-network, occur sequentially, and all ER HSA contributions are available at the time of service.

22 Employee Only - High Cost Scenario Service # of Services Covered Amount Total Cost 2015 Employee Cost HSA HSA Fund $0 $1,484 Preventive Visit (Well Adult)1$220 $0 PCP OV (sick visits)3$100$300$75$105$300 Specialist OV (Orthopedic Surgeon)3$160$480$180$255$480 IP Hospital (3 days); Musculoskeletal1$25,000 $2,745$3,640$4,048 Physical Therapy20$95$1,900$0 $172 Generic - Retail10$25$250$0 $50 Brand Formulary - Retail2$110$220$0 $44 Employee Subtotal $28,370$3,000$4,000$5,094 HSA Used $1,484 Total Employee OOP Expense $28,370$3,000$4,000$3,610 Annual Premium $173$0 HSA Balance $0 True Employee OOP Cost with Premium $3,173$4,000$3,610 Assumes services are in-network, occur sequentially, and all ER HSA contributions are available at the time of service.

23 Employee + Family - Low Claims Scenario Service # of Services Covered Amount Total Cost 2015 Employee Cost HSA HSA Fund $0 $1,484 Preventive Visit (2 Well Adult; 2 well child) 4$220$880$0 PCP OV (sick visits)2$100$200$50$70$200 Specialist OV2$160$320$120$170$320 Generic - Retail12$25$300$0 $300 Employee Subtotal $1,700$170$240$820 HSA Used $820 Total Employee OOP Expense $1,700$170$240$0 Annual Premium $13,606$12,324$12,085 HSA Balance $664 True Employee OOP Cost with Premium $13,776$12,564$12,085 Assumes services are in-network, occur sequentially, and all ER HSA contributions are available at the time of service.

24 Employee + Family - High Cost Scenario Service # of Services Covered Amount Total Cost 2015 Employee Cost HSA HSA Fund $0 $1,484 (4) Preventive Visits (2 Well Adult; 2 well child) 4$220$880$0 PCP OV (sick visits)3$100$300$75$105$300 Specialist OV (Cardiologist, Endorinologist) 11$160$1,760$660$935$1,760 Inpatient Hospital (4 days) - heart attack1$185,000 $2,340$3,065$7,940 Generic - Retail24$25$600$0 $120 Brand Rx Retail *24$145$3,480$600 $696 Employee Subtotal $192,020$3,075$4,705$10,816 HSA Used $1,484 Total Employee OOP Expense $192,020$3,075$4,705$9,332 Annual Premium $13,606$12,324$12,085 HSA Balance $0 True Employee OOP Cost with Premium $16,681$17,029$21,416 Assumes services are in-network, occur sequentially, and all ER HSA contributions are available at the time of service.

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