Negotiating with the New Insurance Rules
For K-12 local Association members currently covered by the Maine Benefits Trust health insurance plans, the health insurance landscape has been dramatically altered. As your Association representatives sit down to negotiate your contracts in the coming weeks, months and years, there is crucial information you, as members, need to understand about the change.
You may already be aware that legislators voted to change the state law, despite the MEA’s efforts, requiring Anthem to provide ‘experience ratings’ to local school districts requesting the information. This information will make it easier for your district to get quotes from other insurance carriers and bring proposals that alter your health insurance benefits to the bargaining table.
C.J. Betit, Interim Director of Collective Bargaining and Research, says it is possible that a carrier could offer some individual districts a lower premium if they have a good ‘experience rating.’ However, he urges members to be wary of a ‘too good to be true’ price saying, “any plan that you get is going to have higher deductibles, higher out-of-pocket costs and/or a lesser plan design. Some of the risk will be transferred to the individual, and you’re going to have to pay more for deductibles, co-pays and co-insurance out of pocket. It’s a bit of trying to compare apples to oranges when looking just at premiums of different plans.”
Currently, Betit says there are no other plans on file with the state Bureau of Insurance that matches the plan design of the Benefits Trust ChoicePlus Plan. All plans offered in the state are registered with the Bureau of Insurance.
This is a complex issue, and one that Betit says cannot be solved in a few sessions at the bargaining table. Because the stability of the Trust is based on its size, it is an issue that impacts us all, and should be carefully considered when reviewing other possible plans, keeping in mind, “if you leave The Trust and go with what seems like a lower-cost provider, you are basically gambling your district will remain healthy year to year and that is not a risk worth taking,” said Betit. “There is no insulation from the volatility of the market when a district goes it alone. One case of cancer, or premature birth or other major illness in a district — and these things occur — and the district’s rate is going to sky rocket.”
Betit encourages any local Association that is facing any current or future changes to health insurance coverage to immediately contact the MEA UniServ or MEABT for guidance and information. We can provide a side-by-side analysis of plans being considered, as well as information on other issues.
The MEABT is still studying the impact of district-level experience ratings and what the resulting market pressures will have on the Trust’s premium structure. Premium increases for next fiscal year will not be known until the spring.
At The Bargaining Table
- The MEABT offers premium and plan design stability
- MEABT is Anthem’s largest client on the East Coast
- MEABT has a pool of 70,000 people; most districts average around 300 people
- Bigger Pool = Easier to balance big claims
- Larger pool drives costs down for all
- Historically, schools have volatility in their experience year to year
- Short-term in individual districts: New plan could be cheaper if you have good experience
- Long-term in individual districts: Year to year volatility in claims cause costs to increase