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September 23, 2002

New health plans for new year

By Michael Terrazas

Capping a project designed to offer employees more choices in coverage while at the same time trimming the University’s health insurance expenses, Human Resources has unveiled a set of revised health plans for 2003.

A letter is being mailed to all employees eligible for Emory health plans, according to HR Vice President Alice Miller, to explain the changes and provide the information employees need to consider their options before the annual Open Enrollment period begins Oct. 21, but the major changes include:

• The addition of a third health plan geared toward healthier persons who do not anticipate the need for chronic care and/or expensive hospital stays and procedures.

• Comprehensive prescription drug and mental health benefits across all three plans.

• A $5 increase in physician-visit copayments for both EmoryCare and EmoryChoice, to go along with modest premium increases for active employees.

• A restructuring of premiums for retired employees, following the decisions made during the spring.

“This was especially challenging for Emory, because we are a health care provider and, naturally, no one wants to pay more,” Miller said. “Therefore we see it from both sides. We’ve come up with some creative solutions and are offering health plans that promote making people healthy, keeping them healthy and are affordable.”

Monthly premiums for EmoryCare will increase anywhere from $4 for individuals to $17 for families, while EmoryChoice premiums will increase $3–$14 per month. Core physician copays increase from $10 to $15 for EmoryChoice ($25 to $30 for Aetna network), and EmoryCare in-network copays go up from $15 to $20.

The new “HealthChoice” preferred provider (PPO) plan will cost $25 per month for individuals, $85 for employees and children, $109 for employees and spouses, and $138 for families. Physician-visit copayments are higher ($30), along with deductibles and maximum out-of-pocket expenses, but the monthly premiums are lower than the other two plans, and HealthChoice participants get to choose their physician.

“We are really excited about that program,” Miller said. “It is directed for people who want to make sure they are healthy, want to have regular physicals and want to be able to go to a doctor with a reasonable copayment—but who don’t anticipate the need for hospitalization or any kind of long-term therapeutic care.”

All health plan participants will have a $10 copayment for generic drugs, $20 for formulary brand-names and $40 for non-formulary brand-names. Three-month supplies will still be available by mail order, but the payments will increase to $20/$40/$80 and two copays for a 90-day supply. Additionally, PPO plan participants (EmoryCare and Health Choice) must purchase generic drugs, if available, or pay the difference in cost between generic and brand-name drugs.

One of the main goals of the health plan redesign project was to give employees more choices in health coverage—but, as always, participants should make their plan selection not only on the basis of which is least expensive, but on which is most appropriate.

“There will be specialists available at Open Enrollment to work with employees on choosing the right plan; we will try to educate people on the up and down sides to each plan,” Miller said. “But in the end it has to be their decision; we don’t want to tell people what kind of insurance to take.”

As was decided during last spring’s campuswide discussion on employee benefits, the University has lowered its contribution to retiree health premiums to 50 percent. In some cases, the resulting premium increases for retirees are significant; hardest hit will be retirees under 65, whose monthly EmoryChoice premiums will go up anywhere from $94–$263 and whose EmoryCare premiums could increase as much as $140.

“It’s regrettable that financial pressures bearing on the University forced us to divert more resources to active employees, but these are realities with which every employer in the country is dealing,” Miller said. “The group that stands to bear the brunt of the cost are those retirees who have not yet reached the age to be eligible for Medicare.”

Beginning in 2003, retirees over 65 will no longer be eligible to enroll in EmoryChoice. However the Health Plus plan also is available with lower premiums for retirees over 65, and another new plan offered only to retirees (Medigap) also offers lower premiums.

“We wanted to come up with other options where we could adhere to the ‘50 percent rule’—but also offer good benefits, especially drug benefits,” Miller said. “So we are really excited about being to offer these options.”

Aside from small premium increases, dental plans remained largely unchanged, and the University was able to reduce premiums for some participants in the Dental Access plan.
Finally, Emory retained both Aetna and Cigna as its insurance providers, though Cigna has only a one-year contract, during which Miller said Emory will expect major improvements in claim processing, customer service and costs. Prescription drug benefits will handled by a new provider, CareMark.

All totaled, Miller said, health insurance will still cost the University roughly $2.8 million more in 2003 than in 2002, though the overhaul is projected to save $2.7 million from what it would have cost.