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June 24, 2002

Medical plans to be redesigned

By Jan Gleason

In an effort to reduce the rate of increase both in employee premiums and in Emory’s cost in providing medical insurance for its employees, an extensive project is under way this summer to redesign employee medical plans.

The project involves some 50 people, representing all components of the faculty and staff, working on seven committees to review Emory's medical benefit strategy, re-evaluate the design of the plans and select plan administrators.

Representatives from the School of Medicine, the Rollins School of Public Health, Emory Hospitals and The Emory Clinic are contributing their expertise to the project.

“Health costs are projected to increase 14 percent in 2002,” said Alice Miller, vice president for Human Resources. “We’re concerned that employees and Emory cannot absorb cost increases of this magnitude. This project is an effort to maintain a competitive medical plan, while doing our best to reduce the rate of cost increases.”

It is also an effort to provide more options to employees. When Open Enrollment comes around this fall, Miller said Emory may offer three or four medical plans instead of the current two.

Another change will be consolidating into a single prescription drug coverage plan and a single mental health plan; employees no longer would need to select their coverages based on needs in these areas.

“There will be different alternatives,” Miller said, “and we’re looking at some alternatives for the very healthy and those who may not need as comprehensive of coverage. We’re finding new ways of looking at these issues.”

Since the bulk of health care costs are driven by lengthy hospital stays, expensive surgical procedures and intensive treatment programs, the new health plans will encourage preventive medicine and disease management, so that those who suffer from chronic diseases—such as high blood pressure or diabetes—could avoid emergency procedures, and so otherwise healthy people can avoid getting sick in the first place.

Emory is working with national health care consulting firm Towers Perrin on the project, but Miller said there are no real models to follow. With institutions of all shapes and sizes trying to cope with spiralling costs for health care, the University is attempting to create its own model for controlling costs while still providing comprehensive, affordable health coverage.

“Employers everywhere are struggling,” Miller said. “We are trying to take advantage of Emory’s brain power to come up with a better way.”

Executive committee members for the project are Miller, Don Brunn, John Fox, John Henry, Woody Hunter, Michael Johns and John Temple. The project began in late April, and a vendor should be selected by August. Information regarding the new plans will be distributed in September, and Open Enrollment will occur later in the fall as usual.