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2011 HEALTH INSURANCE CHANGES

2011 HEALTH INSURANCE CHANGES. Why change the Health Plan?.

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2011 HEALTH INSURANCE CHANGES

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  1. 2011 HEALTH INSURANCE CHANGES

  2. Why change the Health Plan? • State revenues for Millard Public schools are projected to decline significantly over the next several years. The District’s other major source of revenue, property taxes, are projected to be flat as real property values stay stagnant. • Costs continue to rise. Trends show that health claims currently are increasing at 9% to 12%. Millard’s plan has been trending better with expenses climbing at an average of 7% over the past several years. Administration costs have been relatively stable (decreasing 0.4% next year), but costs for reinsurance (insuring those claims above $200,000) is increasing nearly 40% next year. • Currently, the health plan costs the District more than $20 million per year. This is money that cannot be spent on salaries, facilities, educational materials, etc.

  3. What are the Changes? • New Wellness Initiative • Benefits for Part-time employees • Deductible • Out of Pocket Maximum • Prescription co-payment amounts • Emergency Room usage fee • Out-of-Network Changes

  4. Wellness – Strategic Plan • As a part of the District’s strategic plan, the District formed a representative group of employees to look at how we can provide a supportive environment to encourage employees to make healthy choices. The goal is to drive down insurance costs and absenteeism. Healthier employees create multiple benefits for the employee, the employee’s family, and the District.

  5. Wellness Committee Findings • The Wellness committee found that to truly change behaviors that lead to healthier employees, a successful wellness plan must be prioritized. • In response to this finding, the Board of Education approved SimplyWell as a consultant to help in designing the plan.

  6. What does Wellness Mean to Me? • You will not be required to participate in the Wellness program. However, to promote participation, those who participate will continue to have the same District contributions to health insurance (100% for full-time employees). Those who do not participate will be charged 10% of their health insurance premium. • The District has budgeted for other participation incentives. Effective incentives will be developed with the help of Simply Well.

  7. What is “Participation in Wellness?” • Year #1 (2011-12) : Year one participation will entail the employee completing a health risk assessment questionnaire and a biometric screening (a blood sample will be analyzed by SimplyWell). • Year #1 : The District will be covering the cost of biometric screenings at times and locations to be determined. If you prefer, you will also be able to have your doctor do a blood draw and analysis and you may authorize those results to be sent to SimplyWell.

  8. What is “Participation in Wellness?” • The design of the program in future years will be developed through collaboration that involves input from multiple groups including, but not limited to, building wellness champions, collective bargaining agents, administrators, and the Board of Education.

  9. Other Benefits of Wellness • Simply Well has developed an individual web portal that will allow each employee and his/her spouse to track their own personal wellness. • Fun activities will be implemented by building point persons which may include things such as lunch and learns, walking activities, stress management seminars, safety meetings, etc. • More information regarding Wellness will be forthcoming from SimplyWell over the next several weeks.

  10. Benefits Eligibility for Part-Time Employees • Currently, to be eligible to participate in the District’s benefits, an employee must be scheduled to work at least 17.5 hours per week. • Effective January 1, 2012, to be eligible to participate in the District’s benefits, an employee must be scheduled to work at least 20 hours per week.

  11. Deductible • A deductible is the amount that you pay out of your pocket each year before the health insurance begins to pay any benefits for eligible medical claims. • Currently, the District’s in-network health insurance deductible is $350 per individual or $700 per family. • Effective January 1, 2012, the District’s health insurance in-network deductible is $500 per individual or $1,000 per family.

  12. Out of Pocket Maximum • Out of Pocket Maximum is the amount that you are responsible for before your health-plan benefits are paid at 100%. Between the deductible (where the employee pays 100%) and the out of pocket maximum (where the insurance pays 100%) are coinsurance amounts where the insurance pays 80% and the employee pays 20% for in-network expenses. • Currently, the District’s health insurance in-network out-of-pocket maximums (including deductible amounts) are $1,850 per individual or $3,700 per family. • Effective January 1, 2012, , the District’s in-network health insurance out-of-pocket maximums (including deductible amounts) will be $2,500 per individual or $5,000 per family.

  13. Prescription Co-Pay Amounts • Generally, prescriptions fall into one of three categories: • Generic (these are cost-effective alternatives to more expensive name-brand drugs) • Formulary (effective name brand drugs that are less costly than alternative prescriptions) • Non-Formulary (name brand drugs that are more costly than alternative prescriptions) • Currently, the District’s plan generally provides that employees pay a copayment of $10 for Generic, $25 for Formulary, and $40 for Non-Formulary. • Effective January 1, 2012, the District’s plan will change to $10 for Generic, $35 for Formulary, and $60 for Non-Formulary. • The purpose of this change is to create an incentive for persons using more expensive prescriptions to convert to formulary alternatives or generic options. Please work with your doctor to explore what alternatives might be available for you. • This list of approved formularies changes as more prescription alternatives become available and as pricing changes. Please keep in contact with your doctor regarding costs of your prescriptions.

  14. Emergency Room Usage • An analysis of our health plan over the past several years has shown a large number of persons who go directly to the emergency room when a health situation arises as opposed to more cost effective options such as urgent care facilities or quick-care clinics. • Effective September 1, 2011, each visit to the emergency room will cost the employee the first $100 of the expense before deductible amounts are applied or before insurance will pay. This fee will be waived if the employee (or employee’s dependent) is admitted to the hospital following the emergency room visit.

  15. Out-of-Network Changes • Coventry’s network currently includes roughly 97% of providers in the Omaha Metro Area and has an extensive nationwide network in all 50 states. These providers agree to price reductions in exchange for staying in-network where members are more likely to access their services. • Out-of-Network providers may charge whatever they desire. • Currently, the District pays 70% of approved rates for Out-of-Network providers. Effective January 1, 2012, the District will only pay 60% of approved rates. • Example – Assume deductibles are met. If a procedure has an approved rate of $1,000 and a physician wants to charge $1,500: • In-network, the employee pays 20% of $1,000 and the plan pays 80% of $1,000. The doctor may not charge any more. • Out-of-network, the employee will pay 40% of $1,000 and the plan pays 60% of the $1,000. The doctor is free to charge the employee the additional $500 on top of the $400 the employee already paid.

  16. Summary • The purpose of the changes is to create incentives for employees to better manage their own health and their own health care expenses. • We also explored the idea of requiring employees to pay a portion of their health care costs. This may be necessary in the future, but in 2011-12, the District will continue to pay 100% for full-time employees who participate in the health and wellness plan. • The Good News is that Millard’s plan continues to be equal to or better than the $600/$1,200 deductible plan adopted by most districts in Nebraska. In addition, the benefits our health plan provides continue to significantly exceed the general marketplace in Nebraska and nationally.

  17. Questions • Questions regarding Wellness may be directed to Elise McHatton at Simply Well: emchatton@nebraskamed.com . • Other questions regarding your benefits may be directed to: • Michele Ellis at mlellis@mpsomaha.org ; or • Chad Meisgeier at cmmeisgeier@mpsomaha.org .

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