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State Health Plan Budget. FY 2013-2014. SHP Demographic Data. 2013 Monthly Premiums . 2014 Premium Requirements.
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State Health PlanBudget FY 2013-2014
2014 Premium Requirements • State Health Plan (SHP) actuaries have determined the plan needs a 13.05% increase in total premiums for plan year 2014 (Jan-Dec 2014) if the plan wishes to maintain its “grandfathered” status under the ACA and retain the current plan design • This 13.05% will increase the total required premiums from $1.829B needed for plan year 2013, to $2.067B for plan year 2014. This is a total increase of $238M. • 51.8% of this $238M ($123M) is attributable to general funded agencies and school districts
2014 Premium Requirements Grandfathered Current Plan • If both employer and enrollee premiums increase by 13.05%, the enrollee premium increases by $21.62 per employeeper month (PEPM) and the employer premium increases by $56.28 PEPM • Total requirements would be: 2014 Employer Increase $44.634M Annualization $14.836M 2013-2014 New Retiree $25.497M Total $84.967M
2014 Premium Requirements Grandfathered Current Plan • If the employer pays the entire amount of the increase required to remain grandfathered with the current plan design, that equals an 18.1% increase, or $77.90 PEPM • Total requirements would be: 2014 Employer Increase $61.775M Annualization $14.836M 2013-2014 New Retiree $25.497M Total $102.108M
2014 Premium Requirements Grandfathered 20% Co-Pay Increase • If the employer pays the total premium increase, it is a 6.8% increase and equates to an additional $29.36 PEPM • Total requirements would be: 2014 Employer Increase $23.259M Annualization $14.836M 2013-2014 New Retiree $15.896M Total $53.991M
2014 Premium Requirements Grandfathered 20% Co-Pay Increase • It is also possible to remain grandfathered and adjust the co-pays and deductibles by up to 20% • This would result in a 4.9% premium increase for both employer and enrollee, which equates to $21.23 PEPM for employer and $8.13 PEPM for enrollee • Total requirements would be: 2014 Employer Increase $16.816M Annualization $14.836M 2013-2014 New Retiree $15.896M Total $47.548M
2014 Premium Requirements Grandfathered 20% Co-Pay Increase • If the enrollee pays the total premium increase, it is a 17.7% increase and equates to an additional $29.36 PEPM. This will cause the plan to lose its grandfathered status. • Total requirements would be: 2014 Employer Increase $ 0.000M Annualization $14.836M 2013-2014 New Retiree $15.896M Total $30.732M
10% Co-pay increase with $53.991M employer funds • If $53.991M is the budgeted general fund employer contribution, and the co-pay structure is increased by 10%, then the member contribution would need to be increased by $26.81per employeeper month.
$53.991M employer money and targeted plan design changes • If $53.991M is the budgeted general fund employer contribution then the following targeted plan design changes could be made: • Deductible increased from $350/700 to $385/770 (10%) • Emergency room copay increased from $125 to $150 (20%) • Outpatient hospital copay from $75 to $90 (20%) • Physician co-pay from $10 to $11 (10%) • Pharmacy to from 9/30/50 to 10/36/60 (11% increase for generic, 20% for brand and non-preferred) • Plus, a $6.83 per month premium increase for members
2014 Premium Requirements ACA Compliant Plan • If the SHP retains the current co-pay structure and picks up all the required preventative care to become ACA compliant, then the premium increase would be 16.8% for both employer and enrollee ($72.46 employer PEPM; $27.82 enrollee PEPM) • Total requirements would be: 2014 Employer Increase $57.498M Annualization $14.836M 2013-2014 New Retiree $29.915M Total $102.249M
2014 Premium Requirements ACA Compliant Plan • If the SHP retains the current co-pay structure and picks up all the required preventative care to become ACA compliant and the employer pays the entire premium increase, it equates to a 23.3% premium increase ($100.28 PEPM) • Total requirements would be: 2014 Employer Increase $79.526M Annualization $14.836M 2013-2014 New Retiree $29.915M Total $124.277M
2014 Premium Requirements ACA Compliant Plan 20% Copay changes • If $53.991M is the budgeted general fund employer contribution, the SHP chooses to offer all preventive care services required under the ACA, and a 20% increase in co-pays and deductibles is implemented, then the member premium would need to be increased by $35.52 per employeeper month