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AGENDA

AGENDA. Further Work on the three Plan Design Models Two-Year Plan Design Changes Rx Plan Design Model Next Steps. Scenario 3.

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AGENDA

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  1. AGENDA • Further Work on the three Plan Design Models • Two-Year Plan Design Changes • Rx Plan Design Model • Next Steps

  2. Scenario 3 • PY 2012 and PY 2013 funding PEPM is based on 5% increases over 2011 re-projected costs of $1,229.61 PEPM with the April 1, 2011 changes. Requires additional resources through the bargaining process to bridge the gap between the State’s proposal of $1,149.04 PEPM and the current cost of $1,229.61 PEPM. • Add more procedures to the Additional-Cost Tier $ 5,000,000 • Increase Out-of-Pocket Max: $1,500 6,200,000 • $35/month Spouse or Domestic Partner Surcharge 9,000,000 • TOTAL: $22,200,000

  3. The Scenarios • Scenario 3 • PY 2012 and PY 2013 funding PEPM is based on 5% increases over 2011 re-projected costs of $1,229.61 PEPM with the April 1, 2011 changes • $20.2 million in plan design changes for 2012 • Scenario 5 • PY 2012 and PY 2013 funding PEPM is based on 0% increases over 2011 re-projected costs of $1,229.61 PEPM with the April 1, 2011 changes • $59.8 million in plan design changes for 2012 • Scenario 2 • 2012 to 2013 funding PEPM is based on 0% increase from proposed Governor’s Budget of $1,149.04 PEPM • $100.3 million in plan design changes for 2012

  4. Scenario 5 • PY 2012 and PY 2013 funding PEPM is based on 0% increases over 2011 re-projected costs of $1,229.61 PEPM with the April 1, 2011 changes; requires $59.8 million in plan design changes for 2012. Requires additional resources through the bargaining process to bridge the gap between the State’s proposal of $1,149.04 PEPM and the current cost of $1,229.61 PEPM. Add more procedures to the Additional-Cost Tier $10,000,000 Out-of-Pocket Max: $1,500 6,200,000 $35/month Spouse or Domestic Partner Surcharge 9,000,000 Reduce Chronic Care Coinsurance (Asthma, Hypertension, Diabetes, COPD, CHF, Cholesterol ($2,800,000) Add Deductible - $250 In-Network; $500 Out-of-Network (4 office visits not subject) 12,900,000 4TH Rx Tier for Specialty Drugs - $100 copay 600,000 Tobacco Surcharge for Employees and Spouses $25/mo 2,400,000 $1,000 out-of-pocket max for Rx (1,000,000) Office Visit Coinsurance: 20% PCP, 35% Specialist 5,600,000 Rx Tiers: $10 Generic, $30 Brand, Higher of 50% or $60 Brand non-formulary, Mail Order: 2.5 x Retail 11,500,000 Discontinue Prescription Drug Exceptions 1,500,000 Rx Deductible: $50 3,900,000 TOTAL $59,800,000

  5. Scenario 2 • PY 2012 and PY 2013 funding PEPM is based on 0% increase from the State’s proposal of $1,149.04 PEPM; requires $103,500,000 in plan design changes. Add more procedures to the Additional-Cost Tier $10,000,000 Out-of-Pocket Max: $1,500 6,200,000 $50/month Spouse or Domestic Partner Surcharge 12,000,000 Reduce Chronic Care Coinsurance (Asthma, Hypertension, Diabetes, COPD, CHF, Cholesterol ($2,800,000) Add Deductible - $500 In-Network; $500, $1,000 Out-of-Network 27,600,000 4TH Rx Tier for Specialty Drugs - $100 copay 600,000 Tobacco Surcharge for Employees and Spouses $25/mo 2,400,000 Rate Retirees Separately going forward 1,900,000 $1,000 out-of-pocket max for Rx (1,000,000) Office Visit Coinsurance: 20% PCP, 35% Specialist 5,600,000 Discontinue Prescription Drug Exceptions 1,500,000 Rx Deductible: $50 3,900,000 Additional funding through bargaining or premium contribution 31,000,000 TOTAL $103,500,000

  6. Employee Contributions • PEBB IS NOT PROPOSING EMPLOYEE CONTRIBUTUIONS • The $31,000,000 number on the previous slide used the following employee contributions. However, the same $31,000,000 could come from the bargaining process. • Employee only - $25/mo • Employee and Spouse/Domestic Partner - $50/mo • Employee and Child(ren) - $50/mo • Employee and Family - $75/mo

  7. Two-Year Plan Design Changes • Previous Scenarios were 2012 changes only, meaning that additional, unknown changes would need to be made for the 2013 plan year • The Board asked the staff and consultants to determine what changes we would need to make in 2012 to resolve the existing funding gaps for the entire biennium • This does not guarantee that we won’t need to make some changes in 2013, but it greatly reduces that possibility

  8. Two-Year Plan Design Models

  9. Two-Year Plan Design Models

  10. Current Plan Design

  11. Next Steps • Next PEBB Mtg on April 19 • Goal is to finalize Models for each of the three Scenarios for final pricing and confirm the Pharmacy Plan Design • We will also continue to discuss other possible changes that could save us money and/or improve purchasing value in 2012 and the future

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