USU Medical Plan Facts

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USU Medical Plan Facts

• The average number of employees covered under the
  plans is 3,411
• The average number of members covered under the
  plan is 10,739

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Number of Months in Reserve
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Comparison of USU Plan Payments for Medical Rx
Coverage
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Introduction to Health Plan Options
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Choice

• USU Employee surveys clearly indicated that you
  want choices in health plan designs.

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More Input is Needed

• We are seeking input from employees about how you
  prefer this choice be delivered.
• What type of choice do you want?

• Shall we stay with a traditional health plan, or
  move to more of a consumer-driven health plan?

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Possible Areas of Choice

• Deductible Levels
• Copayment Levels
• Coinsurance Levels
• Rx Card Deductible Levels
• Rx Card Copayment/Coinsurance Levels
• Rx Card Copay/Coinsurance Maximums

Choice can be delivered through either
pre-packaged plan options (similar to the current
Blue White programs) or a modular approach.
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Choice within the USU Medical Plans
Choice between a number of preset plans would
give you prepackaged programs from which to
choose. In other words, deductibles,
coinsurance, and copayment levels would be
preset. This is very similar to the current
model of the Blue White plans.
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Choice within the USU Medical Plans
Select the medical plan you wish to have
PLAN A
PLAN B
PLAN C HRA
PLAN D HDHP/HSA
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Choice within the USU Medical Plans

• Under the modular approach, a base plan would
  be developed that would have larger deductibles,
  coinsurance levels, out-of-pocket maximums, etc.
  
• From that base plan, you would select from a
  variety of pre-determined options.
• Example one module would be deductibles. You
  could elect to lower your deductible from that
  offered under the base plan.
• This selection would need to be repeated for each
  of the other provisions that are developed as
  choices.

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Choice within the USU Medical Plans
COINSURNACE OPTIONS
BASIC PLAN
DEDUCTIBLE OPTIONS
COPAY OPTIONS
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Alphabet Soup of Consumer- Driven Health Plans
HSA
FSA
HDHP
HRA
Traditional
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Confused?
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Definitions

• Here are some definitions to help you understand
  the options.
• Well specifically discuss
• Who pays into the plan pool?
• How are medical costs covered?
• Is there any leftover possible?
• If so, how is it used?

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• Deductible - The set dollar amount that the
  insured member must pay each year before the
  insurance plan begins to pay for some or all
  covered services. Current Blue Plan has a 150
  deductible the White Plan has a 250 deduct per
  person.
• Copay - The specific dollar amount the insured
  member pays directly to the provider at time of
  service after deductible. Blue Plan has a 20
  copay the White Plan has a 25 copay.
• Coinsurance - The percentage of eligible
  charges that the insured is responsible for after
  any deductible or copay has been met. Blue Plan
  has 80 White Plan has a 70.

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• Out-of-Pocket Maximum - The maximum dollar amount
  the insured pays each year in coinsurance,
  deductibles, and/or copays. Does not include
  amounts that exceed the eligible or allowable
  amount nor charges for services that are not
  covered by the Plan. Blue Plan has a 1,500 OOP
  the White Plan has a 2,000 OOP per person.
• Lifetime Maximum - The total dollar amount the
  Plan will pay for each insured member in his or
  her lifetime for all covered services.
  2,000,000 under current programs.

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Now, How Do They Work?
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Traditional Health Plan

• The employer pays the majority of the premium and
  the employee pays their portion with pre-tax
  dollars.
• Medical costs are paid according to the design of
  the health plan, deductible, co-pay, coinsurance,
  OOP max, etc.
• A balance may occur if claims are less than
  projected, in which case the Plan retains the
  balance in a rainy day fund/reserve.

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Traditional Payments
95
5
Premium Pool


Employee
Employer
Insurance (80)
Deductible
Co-pay
Co-insurance (20)


Medical Expenses
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High Deductible Health Plan (HDHP)

• Meant to protect against catastrophic loss
• Must have minimum deductibles for all health care
  expenses, including drugs
• Typical deductibles
• Self only coverage 1,250
• Family coverage 2,500
• Once deductible is met, still have co-pay or
  co-insurance

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Flexible Spending Account (FSA)

• The employee elects to place a portion of pre-tax
  wages in the FSA
• The FSA is used to offset the employees
  out-of-pocket medical expenses that insurance
  doesnt cover
• A balance may occur if the account is not all
  used and by federal law it is the employers.
  (Use it, or lose it)

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FSA Payments
95
5
Premium Pool


Employee
Additional Pre-tax Use it or lose it basis
Employer
FSA
Insurance (80)
Deductible
Co-pay
Co-insurance (20)


Medical Expenses
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Health Savings Account (HSA)

• Must be used with HDHPs, and no other insurance
  plan available (spouses beware!)
• Employer and/or employee pays in, pre-tax and
  subject to annual limits
• Medical costs can be paid from HSA on a tax free
  basis
• HSA is the employees. Any balance is rolled
  into the next year, and can be taken upon
  retirement or termination

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HSA Arrangements
Employer
Premium Pool
Employee
Both employer and employee may contribute
HDHP Insurance Coverage
Employee HSA
Medical Expenses
Deductible, Coinsurance
Other qualified medical expenses
Unspent balance grows and is the employees
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Health Reimbursement Account (HRA)

• Employer contributes to fund, with pre-tax
  dollars and owns the account
• Funds may be spent only on qualified medical
  expenses or to pay for health insurance premiums
• Unspent funds may be rolled over from year to
  year
• If an employee terminates, unused funds may be
  accessed via COBRA coverage.

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HRA Arrangements
Employer
Premium Pool
Employee
Only employer may contribute
Insurance Coverage
Employee HRA
Medical Expenses
Deductible, Coinsurance, Copayments
Other qualified medical expenses
Unspent balance grows. It is the employers
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HRA HSA

• With the understanding that the University would
  have to significantly increase deductible,
  copayment and/or coinsurance levels to implement
  an HRA or HSA, how interested would you be in
  participating in one of these programs?
• Very interested
• Somewhat interested
• Undecided
• Somewhat disinterested
• Very disinterested

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HRA HSA

• If you had a choice, which tax favored program
  would be of most interest to you?
• HRA
• OR
• HSA

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CHOICE

• Would you prefer to have preset plan designs to
  choose from OR have multiple options under a
  modular approach to use in building your own
  program?
• Preset Plan Design
• OR
• Modular Plan Approach