Health insurance premiums to rise in 2012
After three consecutive years without a rate increase, Florida Conference active clergy, local church lay staff and Conference employees will be asked to pay an additional 10 percent for health insurance premiums in 2012.
“We’ve had some increased utilization under our plan,” said Wendy McCoy, Conference Director of Human Resources. “While we were able to avoid a rate increase for the past three years, we are unable to sustain that going into 2012.”
McCoy added that the Conference Board of Pension and Health Benefits took a number of steps to mitigate a projected 17 percent increase down to 10 percent. “The reduction to 10 percent was only achieved after making some plan design changes. We know that churches have laid-off staff and cut programs. We understand times are difficult and the last thing we want to do is ask churches to pay more of these costs.”
The Conference launched a self-funded health insurance program in 2008. Its cost-sharing partnership with clergy involves churches paying for 80 percent of the premiums and pastors paying the remaining 20 percent. Clergy are required to participate, and churches must pay a flat rate for clergy insurance regardless of how many pastoral family members are covered. This church rate (also known as the “blended rate”) has been $839 per month, and is increasing in 2012 to $924 per month.
The following depicts the new monthly clergy payroll contribution rates for 2012:
|Clergy cost share||2011 Rates||2012 Rates|
|Clergy + other dependents||$236||$261|
Conference staff such as district employees and employees at the Methodist Center in Lakeland pay the same premiums as active clergy, and also will experience the 10 percent increase.
The Adoption Agreement period allowing local churches to adopt the Conference health insurance plan for 2012 currently is underway. Churches choosing to have their lay employees participate in Conference insurance in 2012 must sign and submit their agreements by the Oct. 14 deadline. Churches choosing to waive participation for 2012 must also submit their agreement by the deadline.
Monthly premium rates billed to local churches for lay employees in 2012 are as follows:
|Local church lay employees||2011 Rates||2012 Rates|
|Employee + 1 dependent||$964||$1061|
The Conference insurance adoption agreements and the new rates can be found at http://www.flumc2.org/pages/detail/1006.
In addition to the premium increases, plans call for some higher costs on the services side of the insurance plan. Deductibles will rise from $500 to $750 per year, while co-payments for primary care doctor’s visits will increase from $20 to $25. For prescriptions, generic drugs will remain at $10; preferred brands will go from $25 to $30; and top-tier, non-preferred brands will go from $40 to $60 per prescription.
“Our long-term goal is to make sure our members have quality health care coverage, forever,” added Russ Barlow, chairman of the Health Insurance Subcommittee of the Conference Board of Pension and Health Benefits. “We’ve been able to provide really good coverage without making any changes for three years. As a result of increased claims and costs, we felt it would be irresponsible not to make some changes. We tried to minimize the impact on both the individuals and the churches as much as possible.”
Conference retirees who are not yet age 65 also will pay the 10 percent increase; they represent 40 of the 450 retirees.
The retiree standard plan will be discontinued so these retirees can switch to the premier plan. Barlow encouraged retirees who need financial assistance due to the increased health care costs to seek help from the Preacher’s Relief Board. “We’re not leaving them out in the cold,” he said.
The news is better for the other retired clergy on Medicare, who are not receiving a premium rate increase. These retirees will see an increase in prescription drug co-payments where they tend to use the plan the most. They currently pay $10 for generic drugs, $25 for brand names and $40 for top-tier brands. The second tier brand co-payment will increase to $30 and the third tier non-preferred brand will increase to $60. “By doing this we can keep premium rates the same for retirees,” McCoy said. “We were looking to find as many ways as possible to protect against a premium increase, because that affects everyone.”
In addition, the Conference will drop its dental insurance plan in 2012 in favor of presenting participants with various marketplace options for dental coverage that for most, McCoy and Barlow believe, will offer a better deal. Vision services will remain a part of the overall health insurance program.
McCoy also pointed out that, with the average age of Conference clergy at around 52 years old, more expensive chronic diseases begin to emerge for professionals who spend the bulk of their time caring for others. The Conference is taking pro-active steps to encourage preventative care measures that ultimately can impact insurance claims and expenses. A wellness effort initiated at this past June’s Annual Conference event offered a $100 gift card incentive for clergy and their spouses to take an online health risk assessment through UHC. Those taking the assessment are receiving targeted communications from UHC with tips on how to address specific health concerns. Slightly less than half of the 1,200 clergy and spouse participants enrolled in the Conference plan completed the assessment as of Aug. 31.
Open enrollment for 2012 health benefits begins Oct. 24 with a deadline of Nov. 4. More information and links to additional information about these changes can be found on the Conference website at http://www.flumc2.org/pages/detail/1351.