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April 1, 2004 • Volume 12 Number 14

BC Seeks to Ease Health Plan Rate Hike

Contribution to premiums still highest among area schools

By Jack Dunn
Director of Public Affairs

The Benefits Office has announced new rates for employees' medical insurance plans as well as a new employee contribution schedule that will become effective May 1.

In a letter to all University employees released today, the office announced Harvard Pilgrim had issued an 18.5 percent increase in insurance premiums, a hike that the University was able to reduce to 14 percent by slightly increasing co-payments. As a result of Harvard Pilgrim's increase, Benefits Director Jack Burke said the University was encouraging all employees to consider joining the HMO as as a lower-cost insurance option.

Specifically, Burke said employees with family plans in a Preferred Provider Organization (PPO) who switch to the HMO option will see their monthly cost go down $40 per month, while PPO members who choose to remain in PPOs will see their premiums increase by about $25 per month, or 14 percent.

Those employees enrolled in individual plans who switch from the PPO to the HMO option will see an increase of only $1.32 per month, while those who remain in the PPO option will see an increase of $25 per month.

"We are obviously encouraging employees who are PPO members to consider the lower-cost HMO option this year," said Burke. "It is important to know that the HMO network of doctors is exactly the same as the PPO network and that the only major difference is the need to have specialist referrals coordinated by your primary care physician."

There will be no increase in employee dental plan rates.

To minimize the insurance premium increase, PPO and HMO members will experience slightly higher co-payments with office co-pays rising from $10 to $15 and three-tier prescription drug co-pays rising from $5/$15/$30 to $10/$20/$35.

In addition, the Benefits Office announced that the University will change its contribution schedule for the year to come so as to provide employees with the lower-cost alternatives. After years in which the University contributed 80 percent of the cost of a family premium and 85 percent of an individual premium, the University will now contribute 80 percent to the PPO plan and 85 percent to the HMO plan for both individual and families.

Despite the change, the University's contribution remains significantly higher than that at local colleges and universities including Boston University, which pays 66 percent of employee's health care premiums, and Northeastern University, which pays 70 percent.

"Over the past three years we have been very fortunate compared to most of our peers with respect to our medical insurance increases," said Burke. "We have averaged an annual increase of only 4.25 percent over the past three years, which is well below industry standards. Even with these changes this year, our rates are very competitive with those of other employers, and our contribution schedule remains one of the most generous in higher education."

Burke said April will serve as an open enrollment period, during which employees may switch from one plan to another, enroll in a medical or dental plan for the first time, or change membership from an individual to family plan. The deadline for submitting the application is April 22.

Employees considering changes in their medical or dental plans have the opportunity to meet with representatives from the Benefits Office and Harvard Pilgrim Health Care in the McElroy Conference Room on April 15 at 11 a.m. and April 21 at noon. To sign up, call ext.2-8532.

More information is available at the Benefits Office, More Hall 325, ext.2-3329.

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