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1
Retiree Medical Study
Leadership UpdateOctober 2015
Ensure retirees and university are getting the most for their dollar Affordable, accessible retiree medical plans are now available in the market Taking advantage of options such as Medicare subsidies could lower costs
Ensure university can continue insurance benefits (medical, dental, life) for current retirees By 2019 the liability for current and future retiree medical benefits will be over
$1 billion, increasing to $4.5 billion in 30 years Recent finalized Governmental Accounting Standards Board (GASB) ruling
means the university will need to begin to fund the liability This is additional money that will increase the benefit rate
Retiree Medical Study Objectives
22
-
500.0
1,000.0
1,500.0
2,000.0
2,500.0
3,000.0
3,500.0
4,000.0
4,500.0
5,000.0
2015 2020 2025 2030 2035 2040 2045
Our challenge: Current liability projection
5
$4.5B in 2045
$808M
3
Jan 2015 Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec Jan 2017
Project timeline
Progress to DateAnnounce Study
Launch Dedicated Website
Review Current Plan
Conduct Benchmarking and Marketplace Review
Conduct Listening Tour
Develop Potential Designs
Conduct Focus Group Testing
Develop Implementation/ Communication Strategy
Finalize Plan Analysis
Announce
Direction
Guiding Coalition Meetings Website Updates Educational Resources
Retiree plan implemented
@
@4
TRAC Review
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Current Retiree Insurance Program
Eligibility for insurance benefitsAge 55 and at least 10 years of service, or age 60 with at least 5 years of serviceGenerally, spouses are eligible for lifetime coverageSame eligibility applies
to retiree dental and lifeMust have UM benefits
prior to retirement5
Current retiree medical plans
Pre Medicare retireesPPO PlanHealthy Savings Plan
Post-Medicare retireesmyRetiree Health Plan Healthy Savings Plan
Subsidy – UM subsidy varies based on age and years of service at retirement but averages 50%
6
Only 6 million of 45 million Medicare retirees have coverage through an employer plan
Market plans for Medicare-eligible are robust and offer universal access
Significant federal subsidies are available to complement or replace Medicare
Enhanced Medicare pharmacy benefit by 2020 (provided through Affordable Care Act)
Pre-65 options are developing
Changes outside the university
7
Eligibility and/or vesting (who gets benefits?)Who receives the benefit (and for how long)?How much of a benefit do they receive?Are spouses covered; what about widow(er)s?
Plan design (what do they get?)Cost sharing for medical expenses
Coinsurance, copays, deductibleEmployer funding (how much does UM pay?)
The “levers” for Retiree Medical Program
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Preserve plans (medical, dental, life)Continue current UM subsidy of premiumsTake advantage of market options to increase
value / lower cost
Current retiree recommendations
9
Status of future retiree medical benefitsfor active employees
Plan will likely close to new hiresMultiple options developed
Being reviewed by the Total Rewards Advisory Committee (TRAC), who will make recommendation(s) to VP of HR
Targeting December 2015 or February 2016 recommendations to Board of Curators
Ample time and support resources will be provided to faculty and staff to consider any changes
10
Subhead goes here
2016 Annual Enrollment
HRC August 2015
Your role as a leader Make sure you’re informed
— Understand generally the when and what of Annual Enrollment so you can help inform your faculty and staff
— Know that active enrollment could result in defaults if your employees do not take action
We need your buy-in and support for your employees during the process
12
Important dates to take action
Before enrollment: Choose insurance that is right for you
13
Benefits guide
Meetings & one-on-ones
Plan comparator
Campus Benefits Reps. / HR Service Center
Be tobacco free
http://umurl.us/enrollment
Important dates to take action
During enrollment: Select your plans
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https://myhr.umsystem.edu
Log into myHR
Make your selections
You’re not done until you click “Submit”
Don’t default!
Important dates to take action
After enrollment: Make the most of your benefits
15
Review your confirmation
Complete your HSA paperwork
Keep an eye out for new cards
Consider investing your premium savings
http://umurl.us/enrollment
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SECTION TWO:
Insurance options
Medical options
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Plan Employee monthly premium UM monthly premium
Healthy SavingsLowest premiumHSA w/ university contributionsCombined medical and deductible℞Broad network
Custom Network PlanMid-level premium$0 medical deductible; separate $50 retail ℞ deductibleIn-network providers from MUHC + a few others
PPO Highest premium$350 medical deductible; separate $75 ℞ deductibleBroad network
Tobacco-free discount
No discount
Self $35 $85
& spouse $120 $170
& child(ren) $95 $145
& family $188 $238
Tobacco-free discount
No discount
Self $65 $115
& spouse $179 $229
& child(ren) $146 $196
& family $272 $322
Tobacco-free discount
No discount
Self $123 $173
& spouse $296 $346
& child(ren) $244 $294
& family $434 $484
Tobacco-free discount
No discount
$390 $340
$730 $680
$628 $578
$1002 $952
Tobacco-free discount
No discount
$413 $363
$777 $727
$668 $618
$1068 $1018
Tobacco-free discount
No discount
$517 $467
$984 $934
$844 $794
$1358 $1308
Medical options, cont’d.
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What’s differentPremiums
Tobacco discount & attestation
New medical plan administrator:United Healthcare
New HSA administrator: Optum Bank
Same prescription administrator, ExpressScripts, for all plans
RX Deductible on the custom network plan
Out of pocket maximum changes
Check provider lists – may have changed.
What’s the sameHSA contributions
Amounts prorated after 1st quarter
Custom Network remains in Columbia only
Active enrollment
Self $400
& spouse $800
& child(ren) $800
& family $1,200
Other insurance plans
Dental, vision, life, and accidental death & dismemberment— No change in plan structure— Premiums – no change
Long Term Disability (LTD)— During the two-week period of Annual Enrollment only, faculty and staff have a unique
opportunity to enroll in Option A or Option B Long Term Disability (LTD) without providing evidence of insurability or otherwise going through underwriting
— Those who currently have LTD coverage, will default to the same coverage but can make changes
— Those who waived in previous years, will automatically be enrolled in university paid Option A
Privacy notices— We will be ensuring that all employees are alerted to our privacy notices— Always available at http://umurl.us/notices
19
20
SECTION THREE:
Wellness Incentive
$450 incentive program
21
50 pointsTake the Wellness Pledge in myHR with Annual Enrollment
50 pointsTake an online Personal Health Assessment
* Taxable income. Voluntary retirement plan savings are also deducted. Must pay premiums for medical insurance to be eligible. Must be actively employed at time of payout to earn the incentive.
$450 incentive program, cont’d.
22
What’s different
Rest of incentive program begins November 1, after taking the pledge during Annual Enrollment
No biometric health screening
Expanded activities
Either incentive points or prizes under the Million Step Pedometer Program; not both
Tobacco-free / tobacco cessation program no longer earn incentive points—replaced by premium discount
What’s the same
Must be a primary subscriber to university medical insurance to be eligible
Must be an active employee at the time of payouts
Must earn the initial 100 points by April 30 to receive $100 in your May paycheck; and the remaining 350 points by September 30 to receive $350 in your October paycheck
* Taxable income. Voluntary retirement plan savings are also deducted.