BCSD Insurance Advisory Committee: Collaborating to Understand and Manage Health Insurance Costs

Transcription

1 BCSD Insurance Advisory Committee: Collaborating to Understand and Manage Health Insurance Costs

2 Outline Simple Steps to Complex Problems The Team The Process Target Results 2

3 The Team Overview Insurance Advisory Committee team member acts as a Fiduciary. A Fiduciary is any person or group who Assists in development or establishment of a plan Gives advice in the development or establishment of a plan Provides guidance to the development or establishment of the plan 5

4 Fiduciary Duties Section 404 of ERISA Employee Retirement Income Security Act (ERISA) States a fiduciary MUST: Act solely in the interest of, and with undivided loyalty to the plan s participants and beneficiaries.

5 Fiduciary Duties Section 404 of ERISA Should act: Solely in the interest of the plan participants and beneficiaries With care, skill, prudence and diligence. the prudent expert Exclusively to assist in maintaining a reasonable cost of the overall plan and it s administration

6 The Process Overview Task The task of the Insurance Advisory Committee it to ensure equitable representation of all certified and non-certified staff as it pertains to benefits. Purpose The purpose of the Insurance Advisory Committee is to serve as an advisory body and accept some fiduciary responsibility to school officials as it pertains to the selection, management, and design of designated employee benefits. The committee s purpose is to develop coverage recommendation. Desired Outcome The desired outcome of the work by the Insurance Advisory Committee is to provide input towards the efficient and effective use and delivery of designated employee benefits. 5

7 The Process Keys for Success Create Commi*ee Keys to Success Unbiased Approach Fiduciary Responsibility Common Good Purpose, Principles, Role Task Consultant Analy>cs/Insight Educate Process/Results Driven Advocacy/Representa>on Survey Stakeholders Gain input Iden>fy ac>on items/need Implement/Manage Change Targeted Objec>ves Measurable Goals Mutual Benefit Strategic Orienta>on 6

8 History Trends 1 Rate Increases Cost increases have varied. The last three years are lower than Iowa s average. 2 Trend Utilization has fluctuated mostly due to large claims. Recent trends show a downward trend. 3

9 History Plan Designs $6,000 Deductibles 3 Plan Design Adjustments A. Promoted Stewardship Healthy Lifestyle & Behaviors Education about actual cost Understanding of benefits Plan design fostered excessive cost, promoted unnecessary usage, and increased premiums for all a spiral effect was occurring. $5,000 $4,000 $3,000 $2,000 $1,000 $- BCSD PPO DPLA PPO Kaiser PPO BCSD HDHP DPLA HDHP Kaiser HDHP Single $500 $1,386 $799 $2,500 $2,645 $2,003 Family $1,000 $2,874 $1,854 $5,000 $5,349 $4,079 $60 $50 $40 $30 Rx Copays $20 $10 $- BCSD PPO DPLA PPO DPLA HMO/ POS DPLA All Plan Kaiser All Plans Tier 1 $10 $9 $9 $9 $10 Tier 2 $25 $28 $29 $28 $9 Tier 3 $40 $44 $44 $44 $52 4

10 The Process Cumulative Changes $1, $1, $1, $1, $ Monthly Claim Cost per Employee Poly.(Monthly Claim Cost per Employee) Linear(Monthly Claim Cost per Employee) Medical Plan Trend Lines & Changes 7/1/06: 0% Increase No Plan Changes 7/1/08: 3.3% Decrease No Plan 7/1/10: 16.7% Increase Raised OV copay to $20 Implemented Rx Deductibles and Copays No Plan Changes to HDHP 7/1/12: 1.3% Increase No Plan Changes $ $ $ $- 7/1/07: 10.7% Decrease Moved from ISEBA to Wellmark Direct 7/1/09: 16.6% Increase RFP: renewed with Wellmark No Plan Changes 7/1/11: 7.8% Increase No Plan Changes 7/1/13: 1.3% Increase No Plan Changes except ACA 7

11 Target Results Bend The Trend Monthly Claim Cost Per Employee & Trend Line $1,600 $1,400 $1,200 Monthly Claim Cost per Employee Linear Trendline Polynomial Trendline $1,000 $800 $600 $400 $ Year Trend = +0.1% $0 9

12 Target Results Proactive verses Reactive Ability 1. Downward Cost Trend: Renewals = no change/decrease Pre-planning targets unnecessary costs and targeted usage. 2. Increasing Satisfaction Stakeholder surveys Union/Staff Relations 3. Improve District Positioned Participating Contracts Financial Stability Collaborative Approach Against Adverse Selection 8

13 The Results Collaboration Culture - Change 1. Philosophy/Cultural Consideration Short Term & Long Term Planning Cost Sharing Plan Design Targets (ie. 80/20) Education Consumerism Wellness 2. Plan Performance Targeted Trend Budget Limits Productivity/Outcomes 3. Satisfaction Employee Surveys and Feedback Insurance Company Performance Response by Employees to Benefits In years of limited budget, more money is available for salary increases Collaboration works. It is a key element in creating real and sustainable change in how our health insurance costs and how it benefits all stakeholders. 10

14 THANK YOU!