2014-15 Health Insurance Plan Design

1. 2014-15 Health Insurance Plan Design Welcome !

2. 2014-15 Health Insurance Plan Design Introductions Janice Wavra, The Insurance Center Jay Clark, District Office Ben Miller, District Office

3. 2014-15 Health Insurance Plan Design Agenda

4. 2014-15 Health Insurance Plan Design Question and Input Forms

5. 2014-15 Health Insurance Plan Design

6. 2014-15 Health Insurance Plan Design

7. Why is the district accepting health insurance proposal options? Affordability

8. Affordability of Health Insurance • Unless we are ready to make changes to the health Insurance plan • Fewer and fewer employees will be able to afford • The District will have fewer and fewer dollars to meet student and staff needs • The evidence

9. Affordability of Health InsuranceClaims Ratio • All other variables being equal • Ignoring Medical inflation • Ignoring employee census • Ignoring ACA impact • Ignoring all other variables • Claims ratio history determines the premium rate for future benefit cycles

10. Affordability of Health InsuranceClaims Ratio • Claims ratio • Cost paid by the plan for health care • Divided by the amount of premium dollars paid into the health plan • Industry Standard is a Ratio of 85% • For every $1.00 in premium $.85 pays for health care

11. Affordability of Health InsuranceClaims Ratio • Claims ratio surplus or deficit • Ratios below 85% represent a surplus • Surplus is justification for a reduction in premium rates • Ratios above 85% represent a deficit • Deficit is justification for an increase in premium rates

12. Affordability of Health InsuranceClaims Ratio • School District of Holmen (preliminary info) • Claims January – December 2013 • Medical Claims $5,139,162 • Rx Claims $955,568 Total Claims $6,094,730 • Premiums January – December 2013 • 167 single @ $9,624/yr. $1,607,208 • 193 family @ $21,804/yr. $4,208,172 Total Premiums $5,815,380

13. Affordability of Health InsuranceClaims Ratio • Claims January – December 2013 Total Claims $6,094,730 • Premiums January – December 2013 Total Premiums $5,815,380 • Claims Ratio 105%

14. Affordability of Health InsuranceClaims Ratio • Premium increase necessary to achieve industry standard of 85% • Total Claims $6,094,730 • Necessary Premiums for 85% ratio ÷ 85% $7,170,270

15. Affordability of Health InsuranceClaims Ratio • Premium increase necessary to achieve industry standard of 85% • Necessary Premiums $7,170,270 • Actual Premiums $5,815,380 • Necessary Premium Increase $1,354,890 • Necessary % Premium Increase 23%

16. Affordability of Health InsuranceACA • Beyond Our Claims Ratio • ACA is influencing the market • Industry response is protect from worst scenario • Rate increase 50%-60% • Preliminary information in the La Crosse School District is 25% increase

17. Affordability of Health InsuranceDistrict Budget • School District of Holmen 2014-15 budget • Allows for 10% increase in health insurance premiums • For the District’s portion of premium (generally 80%) • $5,815,380 total premiums • 80% $4,652,304 • +10% $465,230

18. Affordability of Health InsuranceDistrict Budget • 2014-15 Budget Allowance • +10% or $465,230 • At +25% increase budget impact of $1,163,076 • Budget gap of -$697,846

19. Affordability of Health InsuranceEmployee’s Budget • Current Family total annual premium $21,804 • Employees share, no less than 20% • or $4,360.80 • A 10% increase results in $436 less in take home pay in 2014-15 • A 25% increase would reduce take home pay by $1,090 • With wage increase at less than 2% is this affordable?

20. Affordability of Health Insurance • The evidence • Unless we are ready to make changes to the health Insurance plan • Fewer and fewer employees will be able to afford • The District will have fewer and fewer dollars to meet student and staff needs

21. Affordability of Health Insurance Questions on why we need to consider changes to the health insurance plan??

22. 2014-15 Plan Design Options

23. 2014-15 Plan Design OptionsObjectives • Obtain pricing options early • Provide adequate time to make the best decision • Input from staff and school board

24. 2014-15 Plan Design OptionsObjectives • Obtain pricing options early • Provide adequate time to make the best decision • Input from staff and school board

25. 2014-15 Plan Design OptionsReview and Input • School Board Review and Input: 3/24/14, 4/14/14, 5/12/14, 5/26/14 • Staff Review and Input:3/26/14, 4/1/14, 4/1/14 • Modify as Necessary

26. 2014-15 Plan Design OptionsDevelopment of Options • Identify & Examine Driving Factors • List, Evaluate & Select Potential Options • Determine Implementation Year • Incorporate Into 3-Year Direction

27. 2014-15 Plan Design OptionsIdentify Driving Factors • ACA • Utilization and Claims • Wellness Based • Affordability of Premiums / MOOP • Accessibility to provider of choice • Competitive Market

28. 2014-15 Plan Design OptionsDevelopment of Options • Identify & Examine Driving Factors • List, Evaluate & Select Potential Options • Based on actual data • Determine Implementation Year • Incorporate Into 3-Year Direction

29. 2014-15 Health InsurancePlan Design Options

30. 2014-15 Health InsurancePlan Design Options

31. 2014-15 Health InsurancePlan Design Options

32. 2014-15 Health InsurancePlan Design Options

33. 2014-15 Health InsurancePlan Design Options

34. 2014-15 Health InsuranceHigh Claim Area Options

35. 2014-15 Health InsuranceWellness & Education

36. 2014-15 Health InsuranceStatus Quo Option

37. 2014-15 Health Insurance Plan Design V. Determine Potential Strategy Implementation Year VI. Strategies Incorporated Into 3 Year Direction

38. 2014-15 Health Insurance Plan Design VII. How to get more information * District Website * E-mail

39. 2014-15 Health Insurance Questions and Input?? * Ask now, or * Fill out input form, or * E-mail: milben@holmen.k12.wi.us clajay@holmen.k12.wi.us