April 2004

To: All UCCSN Employees

From: Jacque Ewing-Taylor, PEBP Board Member, UNR Faculty

The PEBP Board met yesterday, April 1 to set rates for the next plan year which begins July 1, 2004 and runs through June 30, 2005. I have placed the new rate structure for active employees below in a table. In the first table I have highlighted the areas I thought you would be most interested in: The rates you will pay next plan year, in yellow, and the percentage of the total cost the state is paying for you, in blue. The second table shows, in percentages, the changes from this year’s rates.

The good news is, obviously, your contribution level is going down and there will be an HMO (Anthem) option in Northern Nevada for the first time in several years. We were able to reduce the contribution levels for several reasons, the primary one being that the plan’s experience for the first eight months of this plan year has been very positive. The number of very large claims has dropped and the plan changes that were implemented last year have had the intended effect of reducing claims costs. I am cautiously optimistic for the future and what this could mean for us in terms of being able to reinstate some of the benefits we have lost. However, eight months does not a trend make, and we really need to monitor our costs for a while longer and further analyze the data we are getting, to see more precisely why our experience has been so good these past eight months and to ensure that we are not again placed in a financial bind due to overly optimistic projections. The method now being used by AON to calculate and predict rates is called predictive modeling and is very sophisticated. This method is widely used in the insurance industry, including CALPERS and Medicare, and has proven to be far more reliable than the methodology used previously.

Retirees’ rates will, for the most part, remain static or be only slightly increased this upcoming plan year, in spite of significantly increased premium costs in several categories of coverage. The board decided to “smooth” the rates for participants in the retiree only (non-Medicare), retiree + spouse (with Medicare), and retiree + family (with Medicare) categories so that these participants will not have a contribution increase for the next plan year. Had we not done this, contribution rates in those categories would have risen 300% or more. Check the PEBP Web site later next week for the retirees’ rates. http://www.pebp.state.nv.us/ Details of the reports from AON and the PEBP staff that formed the basis for the board’s decision on all of these rate setting matters are on the PEBP site as well.

One other issue that came up at the meeting that I think worth reminding you about is that of the importance of making sure that the hospital or other facility at which you are receiving medical services is in the PPO network. It is always and ultimately your responsibility to ensure this, and failure to do so could very well cost you thousands of dollars out of pocket. Your doctor may make the arrangements for the procedure and may refer you to a specific hospital or outpatient surgical center, but you must ask the question “Is this facility in my network?” That information is easily available on the PEBP Web site, or by calling the number on the back of your insurance card. I bring this up because the board heard an appeal at Thursday’s meeting in which the employee incurred over $6,000 in direct, out of pocket costs because he assumed the doctor and hospital had determined his network status. Unfortunately the hospital he was sent to was not in the network and neither the hospital nor the doctor asked about network status. Asking a simple question, making a quick phone call, or accessing the network list online would have meant having his claims paid at 80% rather than the 50% he was allowed as an out of network claim.

Finally, another issue about in and out of network came up that I feel is worth some time. If you or a member of your family is in need of emergency care, do not hesitate to go to the nearest medical facility immediately. Regardless of the network status of the facility, you will be covered as in network provided that the situation is truly an emergency. Your responsibility in this instance is to call the number on the back of your insurance card as soon as you possibly can, within at least one business day, and tell them where you are and why. The hospital or emergency facility will also need to contact Benefit Planners within one business day.

By taking responsibility in both of these types of circumstances, you will save yourself money and you will receive the medical care you need. Within the next month, you will be receiving information in the mail about the upcoming open enrollment period and what you need to do to ensure you get into the plan best suited to your needs. I urge you to watch for this information and to read it carefully. Your campus benefits staff can help you understand it and answer your questions, and there will be informative meetings scheduled in each geographic area to which you will be invited. These meetings are good opportunities to ask questions and to talk with PEBP staff and other insurance representatives, as well as your campus benefits specialists.