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February 26, 2014
HEALTH INSURANCE RENEWAL/UPDATEVOLUSIA COUNTY SCHOOL BOARD
1
Highlights 2
Acronyms and definitions Historical rate review and enrollment Federal and Local Marketplace Preliminary Projection
Acronyms 3
ACA – Affordable Care Act
CAT Plan – Catastrophic Plan EAP – Employee Assistance Program
HMO – Health Maintenance Organization
HCR – Health Care Reform HRA – Health Reimbursement Account
OPEB – Other Post Employee Benefits Liability
OPPAGA – Office of Program Policy Analysis and Government Accountability
POS – Point of Service (Triple Option)
PPACA – Patient Protection and Affordable Care Act PPO – Preferred Provider Organization
RFP – Request for Proposal
WAT – Wellness Action Team
Definitions4
Medical Trend The projected cost of medical inflation
Retention The projected cost to administer the plan – including network access,
claims processing and administration Target Loss Ratio
The projected amount of total claims divided by total premiums Claims
The amount paid by the carrier for the cost of services for an insured member of the plan
Insurance Committee & Meetings
Rita Ware (AFSCME)
Laura Cloer (VESA)
Diane Vaissiere (VESA)
Dr. Maryann Bull (Non-barg)
Russ Tysinger (Non-barg)
Joe Zaffuto (AFSCME)
Carol Sawyer (replacing Mr. Zaffuto 3/6)
John Darby (VTO)
Jacqueline Sadler (VTO)
Denise Dietrich (Non-barg)
5
Volusia County School Board Insurance Committee (union representation and voting members as required by contracts)
Insurance Committee meetings for 2013-2014 (monthly during school year, * indicates Wellness Action Team meeting as well)• September 5, 2013 January 9, 2014• October 3, 2013* February 6, 2014• November 7, 2013• December 5, 2013* Next meeting March 6, 2014
Revisiting April 23, 20136
Significant increases to the Florida Health Care Plans – Increased deductibles Copays Maximum Out of Pocket In / Out Patient Emergency Room Lab
No changes to the Florida Blue Plans Renewal rates were 9.5% for Florida Blue and 4% for Florida Health Care
for a blended rate increase of 5.4% Projected financial impact - $3.5M
Revisiting April 10, 20127
Plan Design Changes to the Florida Blue Plans – Increased deductibles Maximum Out of Pocket
No changes to the Florida Health Care Plans Plan design changes kept rate renewal down to 0%
Review of Rates and Renewals8
VCSB Renewals National Trend (blended) (blended)
2004-2005 3.91% 14.83%2005-2006 12.80% 14.24%2006-2007 3.05%* 12.97%2007-2008 10.40% 11.18%2008-2009 9.30% 10.94%2009-2010 8.54% 10.50%2010-2011 6.36%** 8.00%2011-2012 6.10% 10.50%2012-2013 0% 9.06%2013-2014 5.40% 6.00%2014-2015 Up to 7.6%*** 7.00%Prior RFP was done in March, 2002 *RFP was done in November, 2005 (remained with BCBS/FHC)
**Vote against RFP in November, 2009 and March, 2010 ***Subject to potential plan design adjustments
Enrollment9
Health Enrollment Totals As of 10/1/2007 8,286*
As of 10/1/2008 7,867*
As of 10/1/2009 7,512*
As of 10/1/2010 7,585*
As of 10/1/2011 7,402*
As of 10/1/2012 7,079*
As of 10/1/2013 6,739*
Health Enrollment by Plan10/1/07 10/1/08 10/1/09 10/1/10 10/1/11 10/1/2012 10/1/2013
Preferred Provider Organization (PPO) 2,809 1,484 1,436 1,525 1,434 1,283 1,215
Health Reimbursement Account (HRA) 126 1,231 943 646 489 410 355
Triple Option (Point of Service) 2,869 2,946 3,117 3,550 3,723 3,706 3,581
Health Maintenance Organization (HMO) 2,482 2,206 2,016 1,848 1,737 1,659 1,554
Catastrophic Plan 16 19 21 34
(*Numbers do not include dependents or retirees)
(These numbers include both husband & wife that are enrolled under split family – approx. 230 couples)
Marketplace/Volusia Comparison
FEDERAL MARKETPLACE
Platinum
Gold
Silver
Bronze
Catastrophic
VOLUSIA COUNTY SCHOOLS PLANS:
Florida Health Care HMO – Platinum
Florida Health Care Triple Option – Platinum
Florida Health Care POS (Catastrophic) – Gold
Florida Blue PPO – Gold
Florida Health Care HRA - Gold
Higher Premiums / Lower Out of Pocket Costs
Lower Premiums / Higher Out of Pocket
10
Local Marketplace School District Comparisons
Brevard County Schools (Self-Insured)
Lake County Schools (Fully-Insured)
Lee County Schools (Self-Insured)
Manatee County Schools (Fully-Insured)
Pasco County Schools (Self-Insured)
Seminole County Schools (Self-Insured)
11
HMOClassic VP-1, L-43
In-Network only In Ntwk Opt 1 Opt 2 Opt 3 In HMO NetworkIn BC PPO Network
& OOA In Network Out of Network In Network Out of Network
Deductible HRASingleFamily
Annual DeductibleSingle $0 $0 $250 $500 $1,500 $4,500Family $0 $0 $500 $1,000 Per Person Per Person
Coinsurance (Plan Pays) 100% 100% 70% 50% 90% 50% 85% 70% 85% 70%
Out of Pocket MaxSingle $2,000 $2,000 $3,000 $6,000 $5,000 $10,000Family $4,000 $4,000 $6,000 $12,000 $10,000 $20,000
Physician ServicesPCP Copay $20 $20 $30 50% AD $35 50% AD 15% AD 30% AD 15% AD 30% ADSpecialist Copay $35 $35 30% AD 50% AD $50 50% AD 15% AD 30% AD 15% AD 30% ADPreventive CareRoutine Physical Exam, Well Child, Immunization
$0 $0 $0 50% AD $0 50% AD $0 30%, Ded Waived
$0 30%, Ded Waived
Hospital Services
Inpatient $250/Day (Days 1-5)
$250/Day (Days 1-5) N/A 50% AD 10% AD 50% AD 15% AD $300 + 30%
AD 15% AD $300 + 30% AD
Outpatient $100 $100 N/A 50% AD 10% AD 50% AD 15% AD 30% AD 15% AD 30% ADEmergency ServicesEmergency Visit $100 $100 $100 $100 10% AD 10% AD 15% AD 15% AD 15% AD 15% ADUrgent Care $60 $60 $60 $60 10% AD 10% AD 15% AD 30% AD 15% AD 30% ADLab, Xray, & DiagnosticsLab and Radiology $0 $0 N/A 50% AD $0 lab, $50 X-ray 50% AD 15% AD 30% AD 15% AD 30% ADAdvanced Imaging $0 $0 N/A 50% AD 10% AD 50% AD 15% AD 30% AD 15% AD 30% ADPrescription Drugs
Retail (31 Day Supply)FHCP pharmacies; Select Walgreens /
Select Hours
Preferred Generic $3 NA NA
Non-Pref Generic $10 / $15 $10 50% $10 50%
Preferred Brand $30 / $35 $25 50% $25 50%
Non-preferred Brand $55 / $60 $40 50% $40 50%
$3 (FHCP pharmacies only) $3 (FHCP pharmacies only)
$10 FHCP Pharmacy$15 Walgreens or Publix Pharmacy
$10 FHCP Pharmacy$15 Walgreens Pharmacy
$30 FHCP Pharmacy$35 Walgreens or Publix Pharmacy
$30 FHCP Pharmacy$35 Walgreens Pharmacy
$55 FHCP Pharmacy$60 Walgreens or Publix Pharmacy
$55 FHCP Pharmacy$60 Walgreens Pharmacy
$2,250 AD $2,850 (Incl. Gap and HRA)$4,500 AD $5,700 (Incl. Gap and HRA)
FHCP pharmacies, Walgreens (nationwide), and Publix (Volusia and Flagler Co. only)
FHCP pharmacies and Walgreens (nationwide)
Retail 30-day supply Retail 30-day supply
$600 $600
$600 $1,650 ($1,050 Gap)$1,200 $2,400 ($1,800 Gap)
Florida Health Care Plans BCBSFL PlansTriple Option
Classic L03 POS Plan
Balance LQ16 - MOD 3PPO
Plan 117HRA
Plan 0317
Local Marketplace
12
Local Marketplace - Brevard (In-network benefits only)
Benefit Feature VCSB Triple Option L03 Cigna PPO
Annual Deductible $0 $150/$300
Coinsurance 0% 20%
Out of Pocket Maximum $2,000 / $4,000 $3,000 / $6,000
Office visit copay $20 PCP$35 Spec
$25 PCP$45 Spec
Inpatient $250 / day(Days 1-5) $500 +20% AD
Outpatient $100 20% AD
Emergency Room $100 $150 + 20% AD
Prescription(30-day, Retail)
$3/10/30/55 $15/40/70
Employee cost is $72 per month for single coverage
13
Lake County Schools (In-network benefits only)
Benefit Feature VCSB Triple Option L03
Florida BlueBlue Choice 3359 PPO
Florida BlueBlue Choice
HSA
Annual Deductible $0 $500 / $1,500 $1,500 / $3,000
Coinsurance 0% 20% 20%
Out of Pocket Maximum $2,000 / $4,000 $3,000 / $6,000 $4,000 / $8,000
Office visit copay $20 PCP$35 Spec
$25 PCP$60 Spec
$35 PCP$85 Spec
Inpatient $250/day(Days 1-5) $100 +20% AD $300 +20% AD
Outpatient $100 $100 + 20% AD 20% AD
Emergency Room $100 $300 $350
Prescription(30-day, Retail)
$3/10/30/55 $0/25/40(Mandatory Generic / Mandatory Mail Order)
$0/25/40(Mandatory Generic / Mandatory Mail Order)
Employee cost is $25 per month for single coverage
14
Lee County Schools (In-network benefits only)
Benefit Feature VCSB Triple Option L03 Florida Blue BlueOptions 3769
Florida Blue BlueOptions 5773
Annual Deductible $0 $500/$1,500 $1,000/$3,000
Coinsurance 0% 20% 20%
Out of Pocket Maximum $2,000 / $4,000 $3,000/$6,000 $4,000 / $8,000
Office visit copay $20 PCP$35 Spec
$25 PCP$60 Spec
$35 PCP$85 Spec
Inpatient $250/day(Days 1-5) $100 +20% AD $300 + 20% AD
Outpatient $100 $100 + 20% AD 20% AD
Emergency Room $100 $300 $350
Prescription(30-day, Retail)
$3/10/30/55$0/$25/$40
(Mandatory Generic / Mandatory Mail Order)
$0/$25/$40(Mandatory Generic / Mandatory Mail
Order)
Employee cost is $0 per month for single coverage
15
Manatee County Schools (In-network benefits only)
Benefit Feature
VCSB Triple Option L03
Florida Blue BlueChoice PPO
117
Florida Blue BlueOptions PPO
3359
Florida BlueBlue Care HMO 59
Florida Blue BlueChoice HMO
52Annual Deductible $0 $1,500/$3,000 $1,250/$2,500 $250/$500 $1,500 per person
Coinsurance 0% 20% 20% 20% 30%
Out of Pocket Maximum $2,000 / $4,000 $3,000 / $6,000 $3,500/$7,000 $4,500/$9,000 $10,000/$10,000
Office visit copay $20 PCP$35 Spec 20% AD $25 PCP
$50 Spec$30 PCP$60 Spec
$40 PCP$65 Spec
Inpatient $250/day(Days 1-5) $200 + 20% AD $250 + 20%AD $300 + 20% AD 30% AD
Outpatient $100 20% AD 20% AD 20% AD 30% AD
Emergency Room $100 $200 + 20% AD $250 + 20% AD $100 + 20% $300
Prescription(30-day, Retail)
$3/10/30/55 $4/25/50 $4/$25/$50 $8/50/100 $8/50/100
Employee cost is $20 per month for single coverage
16
Pasco County Schools (In-network benefits only)
Benefit Feature VCSB Triple Option L03
Florida Blue BlueCarePremium HMO
Florida Blue BlueOptions
Standard PPO
Florida Blue Basic HMO
Annual Deductible $0 $0 $250/$750 $2,000/$6,000
Coinsurance 0% 0% 20% 20%
Out of Pocket Maximum $2,000 / $4,000 $3,000 / $9,000 $3,000 / $6,000 $5,500 / $11,000
Office visit copay $20 PCP$35 Spec
$30 PCP$50 Spec
$30 PCP$50 Spec
$35 PCP$65 Spec
Inpatient $250/day(Days 1-5)
$500 / day(Max $2,500) 20% AD $100 + 20% AD
Outpatient $100 $500 $300 $20% AD
Emergency Room $100 $200 $100 $300
Prescription(30-day, Retail)
$3/10/30/55 $10/25/40 $10/25/40 $10/25/40
Employee cost is $0 per month for single coverage
17
Seminole County Schools (In-network benefits only)
Benefit Feature
VCSB Triple Option L03
UHCWellness HMO
UHCStandard HMO UHC Family HMO
Annual Deductible $0 $400 / $800 $1,500 / $3,000 $5,000 / $10,000
Coinsurance 0% 20% 20% 20%
Out of Pocket Maximum $2,000 / $4,000 $5,000 / $10,000 $6,350 / $12,700 $6,350 / $12,700
Office visit copay $20 PCP$35 Spec
$25 PCP$50 Spec
$35 PCP$45 Spec
$35 PCP$45 Spec
Inpatient $250/day(Days 1-5) 20% AD 30% AD 30% AD
Outpatient $100 20% AD 30% AD 30% AD
Emergency Room $100 $250 copay $250 copay $250 copay
Prescription(30-day, Retail)
$3/10/30/55 $7/30/60 $7/$30/$60 $7/30/60
Employee cost is $0 per month for single coverage
18
December 2013 Preliminary Renewal ProjectionPrepared by Aon Hewitt (Based on Claims through October, 2013)
19
Trend 9%Trend 9%
Retention 11%Retention 11%
Target Loss Ratio 88.9%Target Loss Ratio 88.9%
Projected Increase
8.17%Approximately 6.1% of this is Health Care Reform taxes
and fees
Projected Increase
8.17%Approximately 6.1% of this is Health Care Reform taxes
and fees
Trend 9%Trend 9%
Retention 13%Retention 13%
Target Loss Ratio 80.9%Target Loss Ratio 80.9%
Projected Increase
7.73%Approximately 5.5% of this is Health Care Reform taxes
and fees
Projected Increase
7.73%Approximately 5.5% of this is Health Care Reform taxes
and fees
December 2013 Preliminary Renewal Projection 20
Large claimant costs (claims in excess of $100,000) Total enrollment (employees and dependents) in all plans
continues to decrease however, large claimant costs are continuing to increase, Florida Blue by 13% and Florida Health Care by 2%.
Pharmacy Costs are up by 10% over the prior 12 month period
Prepared by Aon Hewitt (VCSB Consultant)
December 2013 Projected Financial Impact21
CurrentPremium
ProjectedRenewal Premium
Increase
Florida Blue $17M $18M $1.4M
Florida Health Care Plans $46M $50M $3.5M
TOTAL Projected Increase $63M $68M$4.9M
(All Funds)
Based on the current active enrollment (excluding retirees) as of November 2013, the estimated increase to the total premium are projected to be approximately $4.9M.
2014 Medical Renewal As Of February 2013Florida Health Care Plans
22
Florida Health Care Plans delivered the initial renewal to the Triple Option, HMO, and POS medical plans with an increase of 9.3%. After Aon negotiations around the method used to calculate the renewal, FHCP reduced the 9.3% increase to 6.9% for the current plans.
Initial Renewal
• 9.3% Increase• Trend 8%
Aon Negotiation
• 2.4% reduction
FinalRenewal
• 6.9% as is
Increase of$3,169,259Increase of
$4,267,107Decrease of $1,097,848
2014 Medical Renewal As Of February 2013Florida Blue
23
Florida Blue delivered the initial renewal to the PPO and HRA medical plans with an increase of 13.6% using a trend of 9.6%. After Aon negotiations around the method used when calculating the renewal, Florida Blue reduced the renewal to 9.7% above the current rates including Health Care Reform plan design changes.
Initial Renewal
• 13.6% Increase
• Trend 9.6%
Aon Negotiation
• 3.9% reduction
Final Renewal
• 9.7% as isTotal Increase $1,607,872Increase of
$2,265,148
Decrease of $657,306
Projected Financial Impact – 2014 Renewal24
The exhibit below illustrates the estimated financial impact to VCSB and employees for the 2014-2015 Plan Year based on the current active enrollment, excluding retirees.
Total Annual Premium District Paid Portion (Net) Employee Portion
2013-2014 Plan Year $62,812,506 $52,413,750 $10,398,756
2014–2015 Plan Year (Estimated) $67,589,637 $56,547,565 $11,042,072
$ Increase over Current $4,777,131 $4,133,815 (all funds) $643,315
% Increase over Current 7.6% 7.9% 6.2%
Aon Negotiated Total Decrease of $1,755,154 from Initial to Final Renewal
What’s Next?25
March, 2014 Insurance Committee will meet on March 6th and make a
recommendation to the Superintendent on health insurance plans for the 2014-2015 plan year
Renewals for other employee benefit
Other Employee Benefit Renewals26
Delta Dental & Delta Care – no plan changes
5.68% rate change for two (2) years ending 9/30/2016
Hartford Personal Accident Insurance – Waiting on renewal from carrier
Humana Vision Insurance – Waiting on renewal from carrier
UNUM Disability Insurance – Waiting on renewal from carrier
UNUM Life Insurance – Waiting on renewal from carrier
Conclusion of the Health Insurance Renewal/Update Presentation
Questions?
27