More Choices for 650,000 State Employees in 2015
UPDATE: ATLANTA, GA (8/14/2014) – The Board of Community Health voted to approve the 2015 member contribution rates and plan designs for the Georgia Department of Community Health’s State Health Benefit Plan (SHBP), providing more choice in plan options for members next year. The Board’s vote establishes the general framework of the plan options for next year, including member premiums. In the coming months, SHBP will work with the vendors to finalize the benefit offerings of each plan option.
“Throughout 2014, the Governor, the department, Blue Cross Blue Shield of Georgia, and the Board have listened to and heard the concerns of our members and providers regarding elements of the 2014 plan design and rates. Today the Board allows us to take another important step forward in providing the best possible array of vendors, plan options, and rates for our members. Next we will strive to clearly communicate and educate what is going to be available for 2015,” said DCH Commissioner Clyde L. Reese III, Esq.”
The current Pharmacy Benefit Manager (PBM) contract with Express Scripts Inc. and the current Wellness contract with Healthways Inc. will be renewed for the 2015 plan year, and will provide benefits to members who choose to enroll in either BCBSGa or UHC.
To educate its members on the 2015 plan options, SHBP will conduct in-person and online member outreach on the plan options prior to and during the state’s Open Enrollment and Retiree Change Option Period. As information is developed, SHBP members can expect to receive details from their payroll location and online at: www.dch.georgia.gov/shbp.
Open Enrollment will be held October 27 – November 14, 2014, for the January 1, 2015, start date of the new plan year.
2015 RATES
ATLANTA, GA (Special Report) - SHBP is currently working to finalize the 2015 plan designs and 2015 premiums. As in previous years, the new plan designs and premiums will be presented to and voted on by the Board of Community Health in August 2014.
In April this year the Department of Community Health (DCH) State Health Benefit Plan (SHBP) released an invitation for proposal (IFP) to qualified companies to increase the number of vendors that administer the state’s health insurance plan. SHBP also plans to expand the type of plan design options for the 2015 plan year.
The goal of the IFP was to solicit submissions for 1) a second statewide Third Party Administrator (TPA), including medical management, and 2) a fully insured, in-network-only plan for the metro Atlanta service area. The second TPA would offer SHBP members the option of a High Deductible Health Plan (HDHP), a Medicare Advantage option for retirees, and a statewide HMO option. Blue Cross Blue Shield of Georgia (BCBSGa) would continue to offer the Gold, Silver and Bronze Health Reimbursement Arrangements (HRAs), Medicare Advantage to retirees, and would add a statewide HMO option for the 2015 plan year.
“SHBP is looking to enhance member choice in the 2015 plan year,” said DCH Commissioner Clyde L. Reese III, Esq. “To accomplish this, SHBP is exploring the possibility of increasing the number of vendors that administer the SHBP plan design and expand the type of plan design options that are available.”
The responses will be initially organized and catalogued by the SHBP actuarial consultant, AON Hewitt. The substantive review will be done internally by a DCH-staffed evaluation team. A teacher will also participate as a member of the evaluation team.
The Georgia Department of Community Health (DCH) announced in July the additional vendors for the state’s health care coverage for state employees, teachers, school system employees, retirees and dependents during the 2015 Plan Year, which begins on January 1, 2015. Vendors were selected following the Invitation for Proposal (IFP) process, which began in April 2014.
United HealthCare has been selected to offer SHBP members the option of a statewide HMO, a statewide High Deductible Health Plan (HDHP) and a statewide Medicare Advantage option for retirees. Kaiser Permanente has been selected to offer SHBP members a fully insured, in-network-only plan in the metro Atlanta service area. Blue Cross Blue Shield of Georgia (BCBSGa) remains a vendor for 2015 and will offer SHBP members the options one of three traditional Health Reimbursement Arrangement (HRA) options (Gold, Silver or Bronze), statewide Medicare Advantage to retirees, and a statewide HMO option.
The current Pharmacy Benefit Manager (PBM) contract with Express Scripts Inc. and the current Wellness contract with Healthways Inc. will be renewed for the 2015 plan year.
“The Department of Community Health has provided plan members with more new choices to find the health care plan that’s best for their families. We appreciate the cooperation of Blue Cross Blue Shield on contractual issues so that we can expand the number of options available to plan members,” said Governor Nathan Deal.
“We heard and listened to our members and providers concerns regarding the 2014 plan choices. We have worked to provide short-term relief this year. Today we announce the plan will offer more vendor and insurance option choices in the upcoming year. I am confident this enhanced package will benefit our members and plan providers around the state,” said DCH Commissioner Clyde L. Reese III, Esq.
SHBP will conduct in-person and online member outreach and education on members’ plan options prior to and during the state’s Open Enrollment and Retiree Change Option Period. As information is developed, SHBP members can expect to receive information from their payroll location and made available online at: www.dch.georgia.gov/shbp.
Open Enrollment will be held October 27 – November 14, 2014, for the January 1, 2015, start date of the new plan year.
Following the July announcement of successful vendors, SHBP intends to finalize the 2015 plan designs and 2015 member rates. The 2015 plan designs and member rates will be presented to and voted on by the Board of Community Health in August 2014. Open Enrollment will be held in late October/early November 2014 for the January 1, 2015, start date of the new plan year.
The ultimate lineup being considered for the 2015 plan year is as follows:
BCBSGa – Gold, Silver, Bronze HRA (exclusively), statewide HMO, Medicare Advantage
Second Statewide TPA – HDHP (exclusively), statewide HMO, Medicare Advantage
Third Vendor – fully insured in-network-only for metro Atlanta service area
The current Pharmacy Benefit Manager (PBM) contract with Express Scripts Inc. and the current Wellness contract with Healthways Inc. would be renewed for the 2015 plan year.
Proposed SHBP Changes
The plan design changes being considered by the DCH Board will add some features of HMO managed care to the current Health Reimbursement Arrangement (HRA) plan. These changes will apply to all metallic plans (bronze, silver and gold). Member premiums, deductibles, HRA contributions and out-of-pocket limits in the current plans will not be impacted. There will be no additional open enrollment for the 2014 plan year.
Pharmacy Co-Pays
Current Plan Design: Under the current HRA plan, members have co-insurance for pharmacy benefits. ln most instances, payment towards pharmaceutical expenses is split between the plan and the member. There are no deductibles or out-of-pocket limits. The level of coinsurance is dependent upon the drug tier. Members can use funds in their HRA account to pay their portion of the co-insurance.
Proposed Change; The plan design changes being considered by the DCH board will replace pharmacy coinsurance with copays. The proposed copays are set at the same leve! as the 2013 HMO wellness option.
Tier 1 drugs (generic) = $20
Tier 2 drugs (preferred) = $50
'Her 3 drugs (non-preferred) = $80 (2013 HMO wellness plan copay was $90)
Like the 2013 HMO plan, copays for pharmacy will not count towards the members deductible or out-of-pocket limits. Members, however, can use HRA funds for copays.
Office and ER Co-Pays
Current Plan Design: No co-pays. In network preventive care office visits are covered under the HRA plan at 100%. For other office, rehab or ER visits, members must pay out-of-pocket until deductible is met. Members may use HRA funds to meet these out-of-pocket expenses.
Once the plan deductible is satisfied, the cost for office/rehab ER visits is shared between the member and the plan (co-insurance). All HRA plans also have an out-of-pocket maximum. Once the out-of-pocket maximum has been reached, the plan will pay 100% of the expense for these visits. Deductibles, coinsurance, and out-of pocket maximums vary across metallic tier.
Proposed Change: The plan design changes being considered by the DCH board will replace out-of-pocket and co-insurance for office/rehab/ER visits with co-pays. The proposed co-pays are identical to those contained in the 2013 HMO wellness option. Preventive care office visits will continue to be covered by the plan at 100%.
Primary Care (Family practice, General practice, internal medicine, Pediatrics, OB/GYN) = $35
Specialist $45
Rehab Services (PT, OT, Speech, etc.) = $25
ER=$15O
Urgent Care = $35
To access these services, members need only to satisfy the co-pay. Members will continue to be responsible for the co-pay until the out-of-pocket maximum is satisfied. After that, the plan will pay for these visits at 100%.
Members can also use HRA funds for co-payments. Unlike pharmacy, member co-pays will count towards deductible and out-of-pocket limits.
Cost
As mentioned previously, member premiums will not be impacted. For Plan Year 2014, members will have access to HMO cost-sharing features at HRA prices. Unlike traditional HMO plans, members will also have access to a reimbursement account which may be used to satisfy co-pays and other out-of-pocket expenses.
The costs of these changes are being absorbed by the plan. Total estimated cost to the plan for both changes is approximately $114M for 12 months. Projected plan reserves will be lowered to account for the increased costs.
Lower or Higher Premiums. What a Dilemma
Community Health officials said in August, 2013, that the new benefit plan for 2014 will reduce premiums for many state employees and teachers.
At a hearing last year - as reported by Andy Miller - UnitedHealthcare presented a witness — consultant Michael Flaherty — who said employees’ out-of-pocket costs would be “significantly higher’’ under the Blue Cross contract than under United.
The two-day Atlanta hearing on United’s appeal came just days before open enrollment for the SHBP, which covers more than 650,000 state employees, schoolteachers, other school personnel, retirees and dependents. A lawmaker complained for paying $300 for a prescribed medical device with the changes made by the Governor. He was paying $28 for the same device.
{In August last year the Georgia Department of Community Health (DCH) has announced the new vendors for the state’s health care coverage for state employees, teachers, school system employees, retirees (and former employees on extended coverage), and dependents. DCH is the administrator of the State Health Benefit Plan (SHBP), which is responsible for coordinating and overseeing the vendors that provide claims administration services and insurance coverage under the Plan.
Blue Cross Blue Shield of Georgia (BCBSGA) has been awarded the contract to provide health plan administration and medical management. BCBSGA will coordinate closely with Express Scripts Inc., selected to administer pharmacy benefits, and Healthways Inc., selected to administer wellness programs and related incentives. The new plan contracts will be effective for Plan Year 2014, which begins on January 1, 2014.
“SHBP members have seen years of rising health care costs while, for most, the economic recession has negatively impacted their salaries,” said DCH Commissioner Clyde L. Reese III, Esq. “The plan options for 2014 will provide members with the real possibility of financial relief and ensure that SHBP remains on a solid financial footing.”
More than 650,000 SHBP members statewide will have access to a high-quality provider network and will have the choice of enrolling in one of the three (Bronze, Silver or Gold) consumer-driven, PPO-type plan options offered by BlueCross BlueShield. Enrollees will also be provided the added benefit of a Health Reimbursement Account (HRA). The dollars provided to the SHBP member in the HRA can be used toward eligible medical expenses and will lower the SHBP members’ deductible. The majority of members will have an option available to them that will reduce their monthly premiums.
“This approach will provide administrative and plan coverage efficiencies which are key to SHBP’s fiscal soundness,” said Trudie Nacin, chief of SHBP. “SHBP has taken a member-centered, value-based approach. Throughout the re-procurement, we sought best in practice delivery for our members while achieving the best-value in plan delivery to strengthen our Plan’s fiscal health.”
SHBP will conduct intensive member outreach and education on members’ plan options prior to and during the state’s Open Enrollment and Retiree Change Option Period, scheduled for October 21 through November 8, 2013.}
Blue Cross attorneys questioned Flaherty’s qualifications and said his bid analysis was incomplete.
“This process has been an embarrassment to our state [and] to our governor,’’ said Randy Evans of McKenna, Long & Aldridge. Evans represented United at a hearing on its appeal of the lucrative contract award to Blue Cross and Blue Shield of Georgia. Evans is also Gov. Nathan Deal’s attorney in unrelated matters.
A second witness, United official Kimberly McCurdy Spence, testified that her company was not allowed to submit a bid that combined medical management and third-party administration functions, even though that’s what the state ultimately decided to do in the contract.
She said the United bid would have been lower if the state had allowed it to combine the two functions.
McCurdy Spence also said the state “changed their strategy’’ in the middle of the contract process by choosing just a single health plan design, after requesting that bidders submit proposals for multiple designs.
Also representing United was former Georgia Attorney General Thurbert Baker, now at McKenna Long. Baker said that in his 13 years as the state’s top legal officer, “I never saw anything like this.’’
The state should now “get it right,’’ Baker said.
Blue Cross, though, has pointed out in the past that the SHBP’s contracting for health insurance is exempt from the main state purchasing law. Community Health has broad flexibility in this contracting process, the insurer has said.
“Blue Cross had no advantage, particularly over the incumbent,’’ Hofmeister added at the hearing Wednesday.
The contracting process has taken many unusual turns, including the Community Health board in September rejecting the option of Kaiser Foundation Health Plan’s HMO to metro Atlanta employees in the SHBP.
Board opposition centered around the objection that the state would be offering a choice of health plans in metro Atlanta but not in other areas of the state.
In April this year Gov. Nathan Deal signed an executive order that requires the Department of Community Health to include a teacher representative in the State Health Benefit Plan invitation for proposals process.
“The state regularly seeks bids and contracts with vendors for the State Health Benefit Plan, which covers 650,000 Georgians, so that our employees receive the high-quality coverage they need for their families,” Deal said. “Teachers and their dependents comprise the largest group of SHBP members, and they deserve to have a strong voice in this process. This executive order accomplishes that.
“In recent years, the state – like private businesses all across Georgia – has faced tough choices, brought on first by the Great Recession and then by the funding pressures brought on by Obamacare’s coverage mandates, which drove up costs. Despite these challenges, we want to give state employees a strong, affordable coverage plan that meets their needs and provides them with options that best fit their family.”
The executive order notes that it is during the invitation for proposals process that teams develop plan design and evaluate bids to administer the plan. “It is critical that educators have a voice in the development process for shaping the health insurance plans available to them,” the order states.
ACA Will Cost SHBP Additional $225 Million
In January this year Gov. Nathan Deal expressed his full support for the Department of Community Health board’s decision to lower out-of-pocket health care costs for state employees. Following the official statement:
“We heard our state employees and teachers and we listened,” Deal said. “I appreciate the board and the commissioner’s willingness to work with me on a timely solution. I shared the concerns of state employees and teachers about the high costs they were having to pay out of pocket. I believe this new direction addresses the core concerns of our employees.
The SHBP already covered 100 percent of preventative care visits, and these improvements give employees an additional layer of security so they can do the right things to stay healthy. The DCH board faced very tough decisions last year as it sought cost savings in light of large new costs brought on by the federal health care law; these are the same pressures affecting private sector employers across the country, many of whom are tightening eligibility or dropping coverage altogether.
In the next budget year for the state, the mandates in the (Affordable Care Act) ACA will cost the State Health Benefit Plan an additional $225 million. These costs will force many tough decisions in the years to come. I’ll continue to work to keep our best public servants with competitive salaries and the health coverage their families need.”
Co-pays will become effective on March 14 and will be retroactive to Jan. 1. Premiums, deductibles, out-of-pockets and HRA contributions will not be affected. SHBP members do not need to take any action to receive these new benefits. SHBP members will remain in the plan they chose during Open Enrollment for the balance of 2014.
The cost of these changes is being absorbed by the SHBP reserves, and will not be passed on to members. The total estimated claims cost to SHBP is approximately $116 million for 12 months.
—> Georgia is one of mostly Republican-led states that are opting out of Medicaid expansion altogether, despite the federal subsidy that goes with it. Georgia’s governor was for state-based health-insurance exchanges before he was against them. Almost 20 percent of the state’s citizens lack any kind of health insurance.
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