Insurance Division Interim Study 18-046 Sept. 25, 2018 Key Take - - PowerPoint PPT Presentation

Employees Group Insurance Division Interim Study 18-046

• Sept. 25, 2018

Key Take Aways

• Success of HealthChoice self-

funded model.

 No rate increase for 2019.

• Future increases in employee

benefit allowance costs.

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Effective Self-Funded Model

• HealthChoice partners with the private

sector for key areas of administration while retaining certain functions to ensure efficiency and price transparency.

• Premium increases for the self-funded

model are below the national trend.

• Very low administrative costs compared to

national benchmarks.

• Contracts directly with providers and

hospitals which allows more control over price increases.

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Plan Comparison

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2017 HealthChoice 2017 Annual Kaiser Survey

Monthly Cost Annual Deductible Monthly Cost * Annual Deductible High Option $571 $500 $594 $1,149 High Deductible Plan $373 $1,500 $481 $2,433 * Average monthly cost of state/local government PPO plans https://www.kff.org/health-costs/report/2017-employer-health-benefits-survey/

HealthChoice Plans Reserve History

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12/31/08 12/31/17 Total Reserve $110 $194 Minimum Required Reserve $140 $184 Available Reserve <$30> $10

• Average annual rate increase over 10 years: 3.9%

(in millions)

Plans offered in 2019

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• EGID is required to contract with HMO alternatives and accept all

plans that meet minimum specifications.

Health Plans Member Spouse Child 2+ Children HealthChoice High/High Alt $594.90 $697.50 $299.24 $507.80 HealthChoice Basic/Basic Alt $466.42 $547.38 $240.54 $406.88 HealthChoice HDHP $401.78 $471.82 $207.52 $350.36 Aetna HMO $897.90 $1,472.24 $601.60 $962.52 BlueLincs HMO $550.00 $811.90 $297.16 $485.24 CommunityCare HMO $894.32 $1,302.68 $455.48 $728.78 GlobalHealth HMO $623.18 $919.88 $355.88 $581.16

Enrollment by Plan

(Members and Dependents)

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HealthChoice High Deductible Health Plan Growth

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• Average age for HealthChoice HDHP is 34 vs 39 for HealthChoice High

Census Date Primary Members Total Lives 2008 48 118 2009 70 151 2010 99 219 2011 90 183 2012 206 447 2013 477 1,011 2014 940 1,882 2015 2,525 4,818 2016 4,728 8,801 2017 8,942 16,179 2018 9,834 17,883

HealthChoice Cost Drivers

• Pharmacy

 Specialty medications trending at 24.3%

compared to -1.2% for non-specialty medications.

 1.4% of members use specialty

medications accounting for 45% ($100 million) of total pharmacy costs.

• Medical

 Members with 3 or more chronic conditions

account for 5% of members but 20% of the total cost.

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HealthChoice Cost Savings Initiatives

• HealthChoice Select

 Incentivizes members to use lower cost providers.

• Care Coordination

 Program to engage high cost members by providing

personalized care management.

 37% of members with 3 or more chronic conditions

have been engaged by care coordinators.

• Medical benefit management (MBM) solution

for specialty medications paid under the medical benefit

 Utilizes advanced criteria for specialty medications.  Leverages pharmacy pricing discounts and existing

rebate contracts.

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Benefit Allowance Impact

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