talk…table talk…ta

AFSCME Council 5 Locals 34, 552, 977, 1719, 1726, 2474, 2822, 2864, 2938 October 2005

HEALTH CARE NEGOTIATIONS UPDATE

Hennepin County recently announced that HealthPartners and Blue Cross have agreed to continue the current program for the first few months of 2006 if we do not agree to a package by November 1. With premiums for HealthPartners up 23% and Blue Cross up 37.7%, employees will pay the following amounts.

Provider / Plan / Employee pays for
single coverage / Employee pays for
family coverage
HealthPartners / Current / $0 / $268.04
HealthPartners / Interim 2006 / $83.64 / $502.32
BC & BS Aware Gold / Current / $201.34 / $668
BC & BS Aware Gold / Interim / $417.34 / $1,203.46
BC & BS CMM / Current / $139.44 / $496.96
BC & BS CMM / Interim / $328.84 / $976.46

The Labor Management Committee recommends the HealthPartners “Distinctions” plan if the county will contribute fully-paid single coverage and 80% of family coverage. This plan has a $15 office visit co-pay for tier 1 clinics and $25 co-pay for tier 2 clinics, with a $5 credit for taking a health care assessment. Other changes include some co-pays for in-patient and outpatient hospital services. HFA clinics are in the new HealthPartners plan.

With no change in the county contribution, this Distinction plan would cost employees $73.29 for individual coverage and $470.50 for family coverage. As of now, we are being told by the county that a decision must be made by October 12 for the County Board to act by October 18 to get the new plan in effect for open enrollment. Otherwise, the county warns that we will be paying the interim rate until agreement is reached on a new plan.

Either the county or AFSCME will hold informational meetings on health insurance. Stay tuned for times and locations.

Volunteers needed for the Action Committee!

To volunteer, call your local union president.

HENNEPIN COUNTY HEALTH CARE CHANGES

The county will be proposing major changes in employee health care for 2006 and beyond. Here’s an overview of the changes and rationale.

The county has offered three health plans in recent years:

§  HealthPartners Plan – 10,500 enrolled

§  Two Blue Cross Blue Shield Plans – 1,640 enrolled, employees pay higher premiums

With all three plans, the health plan is on the hook if claims exceed premiums. The health plans have attempted to set premiums at levels where they can recover the cost of claims plus administrative charges.

In recent years, all three plans have lost money. The cost of claims has exceeded premiums. We learned that the Blues have lost substantially more than HealthPartners because the average Blues member incurs significantly higher health care costs.

Lower premiums will drive employees from the Blues to HealthPartners. Consequently, the Labor Management Committee decided to accept bids for one health plan for 2006. The committee is now in the final stages of reviewing bids and plan designs.

Bids have been submitted by a number of health plans, including HealthPartners and the Blues. They were asked to propose three options: 1) the cost of continuing current benefits; 2) a benefit design with no increase in premium; and 3) ways to reduce the premium increase.

Continuing current benefits will increase premiums 20% to 30% over the current HealthPartners plan. The increase would be as much as $106/month for single coverage and $260/month for family coverage. While this would mean lower overall premiums for employees now with the Blues, it would mean much higher overall premiums for 87% of county employees now with Health Partners.

Without increasing premiums, benefits would suffer. HealthPartners would require such things as a $1000/person and $2000/family annual deductible on everything except preventive care and prescription drugs. Combine that with a 20% co-insurance on all other services.

Difficult decisions confront the county, its unions and employees. We must find new money to retain health care benefits.

We need to decide how much more the employer should pay for its share of premiums.

This money would otherwise be available for general wage increases.

We also need to decide how much more employees should pay for their share of premiums. This increased contribution would offset some or all of any general wage adjustment.

Finally, we need to decide how much employees should pay for out of pocket costs.

For employees with high health care needs, this would offset their general wage increase in addition to whatever increased premium they would have to pay.

TERMS AND HEALTH PLAN OPTIONS

Get acquainted with these terms and the options proposed by health plan providers.

Insured health plan: Employers can buy an “insured” or "self-insured" health plan. Hennepin County buys insured plans, which put the risk of paying claims on the health plan. Self-insured plans place the risk on the employer. HealthPartners and the Blues take the responsibility to pay claims that exceed premium dollars received from the county and employees. In recent years, the health plans have paid claims in excess of the premiums collected. Evaluations show that the total premium cost will be lower if the county continues to purchase insured products. Union members on the Labor Management Committee agree.

Deductibles: A deductible is an amount paid by the patient prior to the health plan making any payment on a claim. Deductibles typically do not apply to preventive care or prescription drugs. The deductible is billed to the employee after receipt of service. Plan designs typically put a limit on the amount of a family’s deductible. For example, a plan with a $500/person deductible could have a $1000/family limit. Currently, HealthPartners has a $500/person and $1500/family deductible for out of network services. The Blues Aware has a $200/person and $600/family deductible for out of network services. The Blues CCM plan has a $300/person and $900/family deductible.

Co-insurances: Co-insurance describes when the employee must pay a certain percent of the bill. For example, durable medical equipment has a 20% co-insurance under both HealthPartners and the Blues. This means the patient has to pay 20% of the cost of a wheel chair. Out of network coverage currently requires a 20% co-insurance with the Blues and a 25% co-insurance with HealthPartners. The Blues CCM plan currently has a 20% co-insurance. Options being presented by the plans include 20% co-insurances on all services other than preventive and prescription drugs. Normally, where co-insurances apply, there is no co-pay.

Office visit co-pays: Office visit co-pays are a flat amount paid at the time of the service for non-preventive medical office visits, chiropractic visits, physical therapy and occupational therapy visits, as well as outpatient mental health and chemical health visits. Under the existing HealthPartners plan, the co-pay amount is $5 if you go to a Level 1 provider and $20 if you go to a Level 2 provider. If you have taken the health assessment, $5 of this is waived. For the Blues, the co-pay is $15. Options include office visit co-pays as high as $30.

Outpatient services: Currently, outpatient surgery and similar outpatient services are covered at 100% by both HealthPartners and Blues Aware. Options include adding an outpatient services co-pay of $25 to $100.

Inpatient services: Currently, inpatient services are covered at 100% by both HealthPartners and Blues Aware. Options range from $100 to $250.

Drug co-pays: Prescription drug co-pays vary. All plans involve what is called a drug formulary. Only drugs on the formulary list are covered or available at a lower co-pay amount. All current plans provide coverage only for formulary drugs. All plans charge a co-pay of $12 for a single prescription and $24 for a 3-month prescription ordered by mail. Non-formulary drugs are covered only if doctors get approval after demonstrating that formulary drugs do not work for the patient. Options include increasing the co-pay to $14, or changing to a tiered co-pay of $10 for formulary generic drugs and $20 for formulary brand name drugs.

Emergency room services: Current ER co-pays are $50. An option was proposed to increase to $75. The ER co-pay is always waived if the patient is admitted as an inpatient.

Out of pocket maximums: These limit the total out of pocket costs an employee or family member has to pay. Once someone reaches the out of pocket max (OOP), insurance covers the rest at 100%. HealthPartners currently has a $3000/person and $5000/family annual OOP. The Blues Aware plan has a $1500/person and $3000/family medical OOP and a separate $300/person prescription drug OOP. The Blues CCM plan has a $3000/person and $500/family overall OOP. An option is to move everyone to the $3000/$5000 OOP. Given the rest of the benefit set for county employees, it is extremely hard for anyone to reach the current OOPs using in-network services. The problem is that as existing co-pays are increased and as new co-pays and deductibles are added, it becomes more likely that some employees and their families will reach the OOP numbers. As out of pockets go up with each new labor contract, the number of people hitting the OOP will get larger.

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