Employee Benefit Renewal 2003

1
Employee Benefit Renewal 2003

• The Catholic University of America
• October 2002

2
Employee Benefit Renewal 2003

• The Marketplace
• The Benefit Selection Process
• The 2002 Renewal
• The Effect on Employees

3
The Marketplace

• Era of increased costs
• Double-digit inflation
• Legislative requirements, e.g., HIPAA
• Rebuilding of HMO profits
• Aging population
• Spiraling prescription drug costs
• Increased utilization

4
The Benefit Selection Process

• Benefit Advisory Committee convened
• Annual review of employee benefits
• Request for proposal (RFP) issued
• RFP responses reviewed
• Benefit vendor selection

5
The Benefit Advisory Committee

• Campus-wide representation
• Vice Presidents
• Staff
• Faculty
• Human Resources
• Finance
• General Counsel
• Health Care Consultant

6
Review of employee benefits

• Comprehensive health care plan
• Medical
• Dental
• Prescription
• Vision
• Life insurance/ADD benefits
• Long-term disability benefits

7
Review of employee benefits (cont)

• CUA key health care goals
• High quality, accessible health care
• Affordable for both employees and University
• Consistent with CUA mission and principles
• Participation of the CUA community in the
  selection process
• Long-term cost management

8
Request for Proposal

• Vendors invited to bid
• Aetna, Inc. (incumbent)
• MAMSI/Optimum Choice
• CareFirst Blue Cross/Blue Shield
• CIGNA HealthCare
• United Healthcare - declined to bid

9
Review of responses

• Proposals reviewed for
• Plan design
• Coverage
• Service to participants
• Cost
• Plan design alternatives proposed and revised
  costs developed

10
Key issues of the CUA renewal

• Higher utilization than in prior years
• Significant increase in large claims
• 90 of POS claims remain in-network
• Increased prescription drug utilization

11
Results of 2003 health care proposals

• Aetna, Inc. (incumbent/finalist)
• Proposed 37 rate increase no increase in
  service or benefits
• MAMSI/Optimum Choice (finalist)
• Proposed 30 increase over current rates
• CIGNA HealthCare (finalist)
• Very competitive bid, long-term cost management
  partner,
• 18 increase over current rates
• CareFirst Blue Cross/Blue Shield
• United Healthcare - declined to bid

12
Life insurance/ADD and long-term disability
benefits

• CUA received financial proposals from
• Liberty Mutual (incumbent)
• reduced rates by 10 over present rates
• CIGNA, Inc.
• reduced rates by 20 over present rates (2 year
  rate guarantee)
• Aetna, Inc.
• reduced rates by 15 over present rates
• All proposals provided coverage identical to
  current plan

13
The Universitys Decision for 2003

• Select health care benefits through CIGNA
  HealthCare
• Offered the most comprehensive plan with the
  least cost increase
• Offer CIGNA Dental Care as a free-standing
  benefit
• Provide coverage through a vertically oriented
  organization - medical/surgical, prescription
  drug, dental and behavioral health benefits
• Offer life insurance, ADD and long-term
  disability coverage through CIGNA

14
CUA Premium Renewal

• Overall 18 cost increase to health care benefits
• Plan design changes effective January 1, 2003
• CIGNA HealthCare effective January 1, 2003
• Life/ADD and LTD with CIGNA effective January 1,
  2003
• New deductions effective December 2002
• CUA will continue to contribute 57 (of the lower
  cost plan) toward monthly premium

15
2003 Monthly Premiums - HealthCare

• HMO
• Single 110.01 12 increase 11.53
• 11 228.49 24 increase 43.55
• Family 328.57 9 increase 27.56
• POS
• Single 187.49 36 increase 49.84
• 11 391.20 51 increase 132.78
• Family 561.01 33 increase 140.39See
  handouts for specific plan coverage

16
2003 Monthly Premiums - CIGNA Dental Care

• As an added benefit this year, employees may
  enroll for CIGNA Dental Care only. You do not
  need to enroll for health care coverage to
  participate in this dental plan.
• CIGNA Dental Care ONLY
• Single 13.39
• 11 22.72
• Family 37.51
• The University does not share in the premium cost
  if you elect dental only.

17
Next StepsOpen Enrollment October 14 -
November 15

• Carefully review the Open Enrollment package you
  will receive during the week of October 7th
• Enroll for CIGNA health care coverage
• Complete a transition of care form (if needed)
• Complete a new beneficiary designation form for
  your CIGNA life insurance
• Attend the Open Enrollment Open House on October
  16

18
Open Enrollment Open House

• When Wednesday, October 16, 2002
• Where Caldwell Auditorium
• Time 930am - 430pm
• Please plan to attend this years open house.
  Vendors will be available to answer your benefit
  questions and assist you with enrollment!
  Spanish speaking translator will be available.