From STRS: Info on 2009 HC premium rates

From STRS, June 20, 2008
Subject: [News] Abbreviated June Board News

PLEASE NOTE: The following is an abbreviated version of the June Board News. A more expanded version with additional information about actions taken by the State Teachers Retirement Board at its June 2008 meeting will be e-mailed on Monday, June 23, 2008.

RETIREMENT BOARD APPROVES PREMIUMS FOR 2009 IN PREPARATION FOR HEALTH CARE OPEN-ENROLLMENT PERIOD At its June 2008 meeting, the State Teachers Retirement Board approved the premiums for calendar year 2009 for all of the health care plans offered through the STRS Ohio Health Care Program. In discussing how premiums are set for each plan, staff reiterated that the same factors that affect health care costs nationwide also affect STRS Ohio's members. Medical and drug trend rates continue to outpace the CPI (Consumer Price Index). Contributing to these high trend rates is the continuing introduction of new medical technologies and high-cost services, as well as new prescription drugs.

Another factor considered in calculating STRS Ohio's premiums is the claims experience for each of the health care plans' risk pools (e.g., non-Medicare benefit recipients enrolled in Medical Mutual and non-Medicare spouses enrolled in Medical Mutual). The 2009 premiums also reflect the board's continuation of its contribution strategy of providing a premium subsidy of 2.5% per year of service, up to a 75% maximum, for eligible benefit recipients, and requiring spouses and dependents to pay 100% of applicable rates.

About 93% of the individuals participating in the STRS Ohio Health Care Program are enrolled in the Medical Mutual and Aetna plans. For a 30-year retiree who is not receiving Medicare and is enrolled in the Medical Mutual Plus Plan, the 2009 monthly premium will increase to $207 from $181. A 30-year retiree who is not receiving Medicare and is enrolled in Aetna's Plus Plan will see an increase in the monthly premium to $294 from $235. A 30-year retiree with Medicare will see a $4 increase in the monthly premium, to $73 from $69, for both the Medical Mutual and Aetna Plus Plans.

The monthly premium for a spouse (non-Medicare) in the Medical Mutual Plus Plan will increase to $760 from $669; spouses (non-Medicare) in the Aetna Plus Plan will see an increase to $838 from $717 per month in 2009. The monthly premium for spouses who are receiving Medicare will increase to $336 from $302 for both the Medical Mutual and Aetna Plus Plans.

Non-Medicare retirees who are enrolled in either Medical Mutual's or Aetna's Basic Plan will see no increase in their monthly premium for 2009, regardless of their years of service. Retirees with 30 years of service who are enrolled in these same Basic Plans, but who are also receiving Medicare, will also see their monthly premium remain at $40. Slight graduated increases in the monthly premiums for the Basic Plans will affect those with less service credit.

Spouse (non-Medicare) premiums will increase to $457 from $362 per month for individuals enrolled in the Medical Mutual Basic Plan. Spouses (non-Medicare) enrolled in Aetna's Basic Plan will see an increase to $505 from $338 per month. The monthly premium for spouses who are receiving Medicare will increase to $175 from $146 for both the Medical Mutual and Aetna Basic Plans.

Premium increases for 30-year retirees in the fully insured plans (AultCare, Kaiser Permanente and Paramount) will be less than $15 a month.

All current benefit recipients enrolled in the STRS Ohio Health Care Program will receive additional information about 2009 premiums in a special newsletter that will be mailed in July. In addition, complete lists of premiums for all health care plans will be posted on STRS Ohio's Web site (www.strsoh.org) by July 31, 2008. At that time, premium information is also available by calling STRS Ohio's Member Services Center toll-free at 1-888-227-7877. In late October, all current enrollees will also receive personalized information that outlines their 2009 plan options and monthly premiums. Open enrollment will run from Nov. 1 through Nov. 25, 2008.