Open Enrollment Informational Meeting

January and February 2015Insurance and Benefits Management

Insurance provided to employees is determined by Collective Bargaining with the Unions◦ TALC Article 14, SPACL Article 13◦ Board Contribution (a.k.a. “Board Flex”) $6372 per year◦ Board Paid Life Insurance - $20,000

Insurance Task Force (TALC 14.09, SPALC 13.09)◦ Representation

8 Union Representatives (4 TALC, 4 SPALC) 8 Management Representatives

◦ Purpose: to review current insurance programs and to explore alternatives, improvements, changes, and specifications to the existing insurance programs.

◦ Meets monthly

How are District Benefits Selected?

RFPs (Request for Proposals)◦ Draft RFP with specifications for the insurance

being sought. ◦ Release RFP to vendors.◦ Vendors provide responses .◦ Responses are evaluated by ITF Subcommittee.◦ Recommendation is taken to the full ITF

Committee.◦ ITF recommendation is taken to the Board.◦ Board takes final action to award the contract.◦ I&B implements plans selected.

How are District Benefits Selected?

Resources for Open Enrollment

Resources for Open Enrollment

Resources for Open Enrollment

Dental: Humana◦ Same plans, HMO: same rates, PPO: 3% rate increase

Vision: Avesis◦ Same Plan, 1.3% rate decrease

Cancer and Other Specified Disease: AllState◦ Same plan options, same rates◦ Evidence of Insurability (EOI) form REQUIRED if making

any changes. Life Insurance: Minnesota Life

◦ Same plan options, same rates◦ Evidence of Insurability (EOI) form REQUIRED if making

any changes.

Voluntary Benefits

Disability: Reliance Standard◦ Same plan options

Short Term Disability (14-day or 60-day elimination) Long Term Disability (90-day or 180-day elimination)

◦ Rates for Long Term and 60-day Short Term remain the same.

◦ Rates for 14-day Short Term increase 20%◦ Disability is calculated based on age and current

salary.◦ Evidence of Insurability (EOI) form REQUIRED if

making any changes.

Voluntary Benefits

Flexible Spending: WageWorks◦ Adjudication of claims is industry standard and

will continue. This protects both the employee and the District.

◦ No cost to the employee to participate◦ Employee elects amount to be set aside for

qualified expenses.◦ IRS increased the annual maximum contribution

to $2,550. ◦ Requires Annual Election

Voluntary Benefits

New Vendor: Aetna effective April 1, 2015 New Onsite Representative – Kim

Murphy Two current plans (Plan 5773 and Plan

3769)◦ Same coverage◦ Same rates

New Plan Option: High Deductible Health Plan with a Health Savings Account.

Medical Insurance

Fill current prescriptions NOW with Florida Blue!◦ Filled at the 54 day mark◦ Receive 90 days of medication◦ 130+ days (4+ months) of medication on hand

New prescription drug provider: Aetna Rx File Transfer of current prescription from Prime to Aetna Rx Ineligible transfers

◦ Certain medications legally prohibited from transfer◦ Expired prescriptions◦ Prescriptions with no more refills

Mandatory Generics, mandatory mail, etc. still applicable Maintenance Options

◦ Aetna Rx Mail Order◦ CVS Option

Mandatory mail prescriptions available for pick up at CVS 90 day (3X) supply 2X copay

Prescriptions

How to Find an In-Network Provider

Different “plan type” than what has been offered by SDLC in the past.

It is like a 401K for medical needs◦ Money is put aside pre-tax.◦ Employer (District) money is added to the account

each pay period.◦ Money is withdrawn tax-free for qualified expenses.

IRS determines which expenses are “qualified”. Same list as the Flexible Spending Accounts. Eligible dependents are defined by IRS, NOT the health

plan.

What is a High Deductible Health Plan with a Health Savings Account?

Must meet deductible for all services, including Rx, except in-network preventative care, before benefits apply.

You pay Deductible/Coinsurance for all services (including Rx) except preventative care.

NO COPAYs APPLY for any services, including drug copays. Members are responsible for the full cost of the Aetna contracted (discounted) rate.

Employees with Family coverage (covering at least one other person on the plan) must meet the FAMILY deductible before any benefits are payable for non-preventative services.

High Deductible Health Plan

To be eligible for an HSA, you: Must be covered under a high deductible health

plan. Must have no other health coverage. Must be 63 or younger to enroll. Must not be enrolled in Medicare (EE or

dependents). Must not be claimed as a dependent on some

else’s tax return. Must not have a standard (or full purpose)

Flexible Spending Account (FSA) or HRA. AND Your spouse must not have a full purpose FSA.

Health Savings Account Eligibility

Plan 3769 and 5773 are the same plan at the same rates for the next plan year.◦ District Contributes $6372 per year ($265.50 per

pay) toward employee medical premiums. If HDHP/HSA is elected, employee still

receives the $6372 per year, but split between premium and the HSA.

$4,887.60 toward premium ($203.65 per pay) $1484.40 into the HSA ($61.85 per pay)

Medical Insurance Rates

In-Network Deductibles (Employee/Family)◦ 3769 Plan: $500/$1,500◦ 5773 Plan: $1000/$3,000◦ HDHP Plan: $2,500/$5,000

Out of Pocket Maximums (Employee/Family)◦ 3769 Plan: $3,000/$6,000◦ 5773 Plan: $4,000/$8,000◦ HDHP Plan: $6,250/$12,500

Maximum HSA Contribution (2015)◦ $3,350 Individual (employee only)◦ $6,650 Family (employee + anyone)

Deductibles and Maximums

Employees can use only the amount in their account at the time of service.

Owned and controlled by employee, portable, not forfeited, at termination, or if you change medical plans. Employee decides how to invest and spend the money.◦ Pay for current qualified medical, dental and vision expenses.◦ Save for future medical and retirement health care expenses

that won’t be subject to federal tax. Accumulated HSA funds rollover Triple tax advantage

◦ Contributions (individuals/employers) are tax exempt◦ No taxes on qualified withdrawals◦ No taxes on account interest and earnings

Health Savings Account (HSA)

Currently,$265.50 per check is added to your check under the “Board Flex” code.

Medical, Dental, Vision, and Cancer Insurance are deducted pre-tax.

Life Insurance and Disability Insurance are deducted post-tax.

If you elect the HDHP/HSA, your paycheck will look different.◦ Board Flex will be $203.65 (instead of $265.50)◦ The balance of the Board Contribution ($61.85) will be

a new row titled “HSA” under “Employer Paid Benefits” box

Paycheck Information

Tiers Plan 3769 Plan 5773

High Deductible Health Plan (HDHP)**

Employee Only $272.70 $255.96 $203.65

Employee / Spouse $660.33 $618.21 $552.35

Employee / Child $409.70 $384.00 $326.89

Employee / Children $574.56 $538.06 $475.20

Employee/ Family $832.43 $779.04 $707.17

Medical Insurance Rates

Employee Only - Low Cost Scenario

Service# of

ServicesCovered Amount

Total Cost

2015 Employee Cost3769 5773 HSA

             HSA Fund       $0 $0 $1,484Preventive Visit (Well Adult) 1 $220 $220 $0 $0 $0PCP OV (sick visit) 1 $100 $100 $25 $35 $100Specialist OV 1 $160 $160 $60 $85 $160Generic - Retail 1 $25 $25 $0 $0 $25Brand Formulary - Retail 2 $110 $220 $50 $50 $220Employee Subtotal     $725 $135 $170 $505HSA Used           $505             Total Employee OOP Expense   $725 $135 $170 $0

Annual Premium       $173 $0 $0

HSA Balance           $979True Employee OOP Cost with Premium

    $308 $170 $0

Assumes services are in-network, occur sequentially, and all ER HSA contributions are available at the time of service.

Claims Examples

Employee Only - High Cost Scenario

Service# of

ServicesCovered Amount

Total Cost

2015 Employee Cost

3769 5773 HSA             

HSA Fund       $0 $0 $1,484

Preventive Visit (Well Adult) 1 $220 $220 $0 $0 $0PCP OV (sick visits) 3 $100 $300 $75 $105 $300Specialist OV (Orthopedic Surgeon) 3 $160 $480 $180 $255 $480IP Hospital (3 days); Musculoskeletal 1 $25,000 $25,000 $2,745 $3,640 $4,048Physical Therapy 20 $95 $1,900 $0 $0 $172Generic - Retail 10 $25 $250 $0 $0 $50Brand Formulary - Retail 2 $110 $220 $0 $0 $44Employee Subtotal     $28,370 $3,000 $4,000 $5,094HSA Used           $1,484

             Total Employee OOP Expense     $28,370 $3,000 $4,000 $3,610Annual Premium       $173 $0 $0

HSA Balance           $0

True Employee OOP Cost with Premium     $3,173 $4,000 $3,610

Assumes services are in-network, occur sequentially, and all ER HSA contributions are available at the time of service.

Claims Example

Employee + Family - Low Claims Scenario

Service# of

ServicesCovered Amount

Total Cost

2015 Employee Cost

3769 5773 HSA             HSA Fund       $0 $0 $1,484Preventive Visit (2 Well Adult; 2 well child)

4 $220 $880 $0 $0 $0

PCP OV (sick visits) 2 $100 $200 $50 $70 $200Specialist OV 2 $160 $320 $120 $170 $320Generic - Retail 12 $25 $300 $0 $0 $300Employee Subtotal     $1,700 $170 $240 $820HSA Used           $820             Total Employee OOP Expense     $1,700 $170 $240 $0Annual Premium       $13,606 $12,324 $12,085

HSA Balance           $664True Employee OOP Cost with Premium

      $13,776 $12,564 $12,085

Assumes services are in-network, occur sequentially, and all ER HSA contributions are available at the time of service.

Claims Example

Employee + Family - High Cost Scenario

Service# of

ServicesCovered Amount

Total Cost

2015 Employee Cost

3769 5773 HSA             

HSA Fund       $0 $0 $1,484

(4) Preventive Visits (2 Well Adult; 2 well child)

4 $220 $880 $0 $0 $0

PCP OV (sick visits) 3 $100 $300 $75 $105 $300Specialist OV (Cardiologist, Endorinologist)

11 $160 $1,760 $660 $935 $1,760

Inpatient Hospital (4 days) - heart attack 1 $185,000 $185,000 $2,340 $3,065 $7,940Generic - Retail 24 $25 $600 $0 $0 $120

Brand Rx Retail * 24 $145 $3,480 $600 $600 $696

Employee Subtotal     $192,020 $3,075 $4,705 $10,816

HSA Used           $1,484

Total Employee OOP Expense     $192,020 $3,075 $4,705 $9,332

Annual Premium       $13,606 $12,324 $12,085

HSA Balance           $0

True Employee OOP Cost with Premium

      $16,681 $17,029 $21,416

Assumes services are in-network, occur sequentially, and all ER HSA contributions are available at the time of service.

Claims Example

Questions?

Thank you!