Panel puts off school options for health care

Rising costs draw complaint

A state board subcommittee Friday recommended rates and benefits for the health plans covering state employees in 2015, but it put off recommendations for public-school-employee plans after one member complained that all options involve a substantial rate increase for some workers.

"I'm of the opinion that what we have received is not in the best interest of the public-school employees in any form or fashion," said Jeff Altemus, deputy superintendent of the Marion School District.

The State and Public School Life and Health Insurance Board's benefits subcommittee unanimously approved Altemus' motion to discuss the public-school-employees plan recommendations again at its next meeting, scheduled for July 11.

In the meantime, Altemus asked the staff of the Department of Finance and Administration's Employee Benefits Division to provide subcommittee members with information on plans offered to public-school employees in surrounding states.

The full 12-member board will make final decisions on the rates and benefits for the teachers and state employees' plans. Its next meeting is scheduled for June 17.

The board and its subcommittee, along with a legislative task force, are studying options for improving the finances of the plans covering about 47,000 teachers and other school employees, and about 28,000 state employees.

The plans for the two groups are identical, but public-school employees pay higher premiums, which Employee Benefits Division officials have said is because the state employees' plans receive more taxpayer funding.

The recommended rates do not account for savings resulting from legislative changes recommended by the State and Public School Life and Health Insurance Program Legislative Task Force.

Those proposed changes include dropping part-time employees from the plans and excluding spouses from coverage who have access to coverage from their own employers.

Even if those measures are adopted, averting a significant increase in premiums for some public-school employees would require an increase in taxpayer funding, Employee Benefits Division Director Bob Alexander said.

But task force Chairman Sen. Jim Hendren said he expects the savings to be significant enough to allow rates to be set at a level comparable to what private-sector employees pay.

"I think everyone needs to stop throwing premiums out until we know what the rules are going to be," said Hendren, R-Sulphur Springs.

He plans to ask Gov. Mike Beebe to call a special session of the Legislature to adopt the task force proposals later this month or in July.

Under the subcommittee's recommendations, the state employees' gold plan would be renamed the premium plan and have a deductible of $1,000 for an individual or $2,000 for a family. The plan, which covers about 24,000 employees, currently does not have a deductible.

The silver plan, which has a deductible of $1,000 for an individual or $2,000 for a family, would be eliminated. The 1,500 employees now in the plan would be moved to the premium plan unless they choose a different tier.

The bronze plan, which has a deductible of $2,000 for an individual or $3,000 for a family, would be replaced with the classic plan, with a deductible of $2,500 for an individual or $5,000 for a family. About 2,300 employees are in the bronze plan.

The state also would add a new option, the basic plan, which would have a deductible of $6,600 for an individual or $13,200 for a family.

The monthly premium for the premium plan would be about $97 for an individual or $463 for a family. By comparison, employees in the gold plan now pay $96.68 a month for individual coverage or $423.60 for a family.

The premium for the current silver plan is $62.72 for an individual or $327.68 for a family.

The classic plan would have a premium of about $46 a month for an individual or $307 for a family. The current bronze plan has no premium for individual coverage. Families in the plan pay $93.08 a month.

The basic plan would have no premium for individual coverage and a premium of about $163 a month for families.

The state would contribute $25 a month for individuals and $50 a month for families to health-savings accounts for employees in the classic and basic plans. Money deposited into such accounts is not subject to federal income tax as long as it is spent on medical expenses.

Under an initiative the board adopted last month, employees who fail to see a doctor for a health screening by Nov. 1 will pay an extra $75 per month. Employees will be given credit for any doctor's visit involving a health screening since Jan. 1, 2013.

If the same benefit options were adopted for the public-school-employees plans, all employees in the gold plan -- and most employees in the silver plan -- would pay lower rates, but the premiums for employees in the bronze plan would increase.

For instance, public-school employees in the bronze plan pay $11 a month for an individual or $269.50 for family coverage.

Under the benefit structure recommended for state employees, public-school employees in the classic plan would pay $84.34 a month for individual coverage or $672.08 for family coverage. The premium for the basic plan would be $41.34 for individual coverage or $529.30 for family coverage.

About 23,000 public-school employees are in the bronze plan, 18,500 are in the gold plan and 5,000 are in the silver plan.

Altemus said the change would cause hardships for employees now in the bronze plan.

"They're suffering huge increases even moving from the bronze into the basic with the huge deductible that's there on top of that," Altemus said.

Alexander said the board kept the premium for the bronze plan low in the past by charging higher premiums for the gold plan. That resulted in more employees switching to the bronze plan, which reduced the amount of premiums collected.

"It's a big increase because we've artificially kept it low," Alexander said. "At some point in time, you have to belly up to the bar and make those adjustments."

Metro on 06/07/2014

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