Proposed Benefit Proposed Benefit Design ChangesDesign Changes
Faculty and Staff Brown Bag Faculty and Staff Brown Bag LuncheonLuncheon
October 13, 2010October 13, 2010
Timeline Timeline Spring 2010 – Subcommittee recommended the Spring 2010 – Subcommittee recommended the
following goals:following goals:– 0% cost increase for University paid benefits0% cost increase for University paid benefits– Consider options for family-friendly medical plan designsConsider options for family-friendly medical plan designs
Summer 2010 – Benefits Consultant (JW Terrill)Summer 2010 – Benefits Consultant (JW Terrill)– Summary of Findings: Summary of Findings:
Above average benefit plan designs compared to Above average benefit plan designs compared to marketmarket
Very generous cafeteria plan funding Very generous cafeteria plan funding Very generous paid sick leave benefitsVery generous paid sick leave benefits
Timeline (continued)Timeline (continued) Summer 2010 – Benefits Consultant (JW Terrill)Summer 2010 – Benefits Consultant (JW Terrill)
– Recommendations:Recommendations: Consider family-friendly medical plan optionConsider family-friendly medical plan option Implement employee contribution for the low deductible Implement employee contribution for the low deductible
medical planmedical plan Reduce paid leaves and include a paid time off leave bankReduce paid leaves and include a paid time off leave bank Reconfigure paid sick leave program and implement a Reconfigure paid sick leave program and implement a
short term disability planshort term disability plan August 2010 – Request for Proposals (RFP’s)August 2010 – Request for Proposals (RFP’s)
– Medical/Rx, dental and vision insurance coveragesMedical/Rx, dental and vision insurance coverages– Medical/Rx RFP results: Medical/Rx RFP results:
Anthem: proposed cost increaseAnthem: proposed cost increase Two other bidders: proposed cost decreasesTwo other bidders: proposed cost decreases
Recommendations:Recommendations:Medical InsuranceMedical Insurance
Change to United Healthcare Change to United Healthcare – 13% decrease in employee only premium13% decrease in employee only premium– Reduces Pre-Medicare retiree premiums to the Reduces Pre-Medicare retiree premiums to the
active employee premium - 43% decrease in active employee premium - 43% decrease in premiumpremium
United Healthcare proposal overview:United Healthcare proposal overview:– Same deductible/cost share levelsSame deductible/cost share levels– Rx copaysRx copays– Good provider network Good provider network – Health Savings Account (HSA) banking optionHealth Savings Account (HSA) banking option
Recommendations:Recommendations:Medical InsuranceMedical Insurance
Convert Medical Plan B into Base PlanConvert Medical Plan B into Base Plan– Employee premium 100% paid by UniversityEmployee premium 100% paid by University– $750 in cafeteria plan funding$750 in cafeteria plan funding– After $1,500 deductible…$10/$30/$50 Rx After $1,500 deductible…$10/$30/$50 Rx
copayscopays– Implement University supplement for Implement University supplement for
dependent premiumsdependent premiums Spouse = $75/month supplementSpouse = $75/month supplement Child(ren) = $100/month supplementChild(ren) = $100/month supplement Family = $200/month supplementFamily = $200/month supplement
Recommendations:Recommendations:Medical InsuranceMedical Insurance
Convert Medical Plan A into Accelerated PlanConvert Medical Plan A into Accelerated Plan– Employee contribution to employee only premium Employee contribution to employee only premium
based on your previous year’s reported Form W-2 based on your previous year’s reported Form W-2 Medicare wages (box 5) Medicare wages (box 5)
– $250 cafeteria plan funding$250 cafeteria plan funding– $10/$30/$50 Rx copays, not subject to deductible $10/$30/$50 Rx copays, not subject to deductible
or cost shareor cost share– MRA will be availableMRA will be available
<$27,000 $27,000 -$44,999
$45,000 -$69,999
$70,000 +
$22/month $45/month $67/month $90/month
United Healthcare United Healthcare 20112011 EmployeeEmployee Monthly Monthly
PremiumsPremiumsBase Plan
(Formerly Plan B)Accelerated Plan (Formerly Plan A)
Monthly Premium Monthly Premium
Employee $0.00 * Employee $22.00 **
Spouse $331.13 Spouse $527.00 **
Child(ren) $232.29 Child(ren) $435.18 **
Family $501.50 Family $894.27 **
* 100% Paid by University ** Employee only contribution will (Dependent rates are net of range from $22 to $90 per month University supplement.) based on salary.
Recommendations:Recommendations:Medical InsuranceMedical Insurance
Base Plan: How University Base Plan: How University supplements and Cafeteria Plan supplements and Cafeteria Plan Funding applyFunding apply
Spouse Coverage Children Coverage Family Coverage
$406.13 premium- $75.00 Supplement- $62.50 Cafeteria Plan $268.63 Adjusted premium
(34% premium savings)
$332.29 premium-$100.00 Supplement- $62.50 Cafeteria Plan $169.79 Adjusted premium
(49% premium savings)
$701.50 premium- $200.00 Supplement- $62.50 Cafeteria Plan $439.00 Adjusted premium
(38% premium savings)
United Healthcare United Healthcare 2011 Retiree Monthly Premiums2011 Retiree Monthly Premiums
Base Plan
(Formerly Plan B Current Premiu
m
Base Plan
(Formerly Plan B)
New Premiu
m
Accelerated Plan
(Formerly Plan A)
Current Premium
Accelerated Plan
(Formerly Plan A)New
Premium
Pre-65 Retiree
$683.42 $369.22 **
$800.93 $459.09
Spouse $683.46 $406.13 * $800.93 $505.00
Children
$512.63 $332.29 * $600.69 $413.18
Family $1,196.07
$701.50 * $1,401.64 $872.27
Post-65 Retiree
n/a n/a **
$404.90 $387.29
Spouse n/a n/a * $404.88 $426.02
Children
n/a n/a * $303.67 $348.56
Family n/a n/a * $708.57 $735.85
Recommendations:Recommendations:Medical InsuranceMedical Insurance
Due to significant cost decrease in Due to significant cost decrease in UnitedHealthcare’s proposal, UnitedHealthcare’s proposal, eliminate University subsidy for pre-eliminate University subsidy for pre-Medicare retiree premiums.Medicare retiree premiums.– Current retirees receiving these Current retirees receiving these
subsidies will be grandfatheredsubsidies will be grandfathered
Recommendations:Recommendations:Dental and Vision InsuranceDental and Vision Insurance
Dental InsuranceDental Insurance– Continue with Delta Dental of MissouriContinue with Delta Dental of Missouri– Same coverage levelsSame coverage levels– 6.6% premium increase6.6% premium increase– One year rate guaranteeOne year rate guarantee
Vision InsuranceVision Insurance– Continue with Vision Service Plan (VSP)Continue with Vision Service Plan (VSP)– Same coverage levelsSame coverage levels– 6% premium increase6% premium increase– Four year rate guaranteeFour year rate guarantee
Recommendations:Recommendations:Paid Leaves – Effective 1/1/2011 Paid Leaves – Effective 1/1/2011
Implement Paid Time Off (PTO) SystemImplement Paid Time Off (PTO) System– Retain current paid energy conservation daysRetain current paid energy conservation days– Retain current paid vacation accrual scheduleRetain current paid vacation accrual schedule– Combine energy conservation days and Combine energy conservation days and
vacation days accrual into PTOvacation days accrual into PTO– PTO accrual maximum at 240 hoursPTO accrual maximum at 240 hours– Provides employee flexibilityProvides employee flexibility
No change in paid holidaysNo change in paid holidays Eliminate vacation buybackEliminate vacation buyback
Recommendations:Recommendations:Paid Leaves – Paid Leaves – Effective 1/1/2011 Effective 1/1/2011 Implement Paid Sick Leave Accrual SystemImplement Paid Sick Leave Accrual System
– Starting banks based on past 10 years’ sick Starting banks based on past 10 years’ sick leave usage, up to 120 hours per year credit leave usage, up to 120 hours per year credit with 1,040 hours maximumwith 1,040 hours maximum
– Unverified Sick LeaveUnverified Sick Leave Staff: Accrue 8 days annuallyStaff: Accrue 8 days annually Faculty: Accrue 6.64 days annuallyFaculty: Accrue 6.64 days annually Unused leave each year to carry over into verified Unused leave each year to carry over into verified
sick leave banksick leave bank
– Qualifies for up to 6 months of additional Qualifies for up to 6 months of additional service credit under MOSERSservice credit under MOSERS
Recommendations:Recommendations:Paid Leaves – Effective 1/1/2011 Paid Leaves – Effective 1/1/2011
Implement Short Term Disability PlanImplement Short Term Disability Plan– To be administered by a Third Party To be administered by a Third Party
AdministratorAdministrator– 30 Day Elimination Period (use Verified Sick 30 Day Elimination Period (use Verified Sick
Leave and PTO)Leave and PTO)– Followed by Short Term Disability Paid Sick Followed by Short Term Disability Paid Sick
Leave at 60% payLeave at 60% pay– Transition plan for current employees will applyTransition plan for current employees will apply
Calendar Days
30 Days
60 Days
90 Days
120 Days
150 Days
180 Days
Elimination Period
Short Term Disability Paid Sick Leave
@ 60% Pay
Projected Cost SavingsProjected Cost SavingsAction Amount
Medical Insurance:
Reduced Employee Medical Premiums $1,638,887
University Supplements ($703,345)
Approximate Medical Insurance Savings: $935,542
Paid Leaves:
Short Term Disability program and administration cost
$130,392
Eliminate Vacation Buyback $85,000
Approximate Paid Leaves Savings: $215,392
Less MOSERS increase for FY12 ($80,000)
Approximate Total Net Savings: $1,070,934
Total Net Savings is equivalent to an Total Net Savings is equivalent to an approximate approximate
$6-$7 per hour incidental fee increase for $6-$7 per hour incidental fee increase for students.students.
Next StepsNext StepsDate Action
October 22, 2010 Board of Regents Meeting
Week of October 25, 2010 Award medical, dental and vision insurance contracts
Weeks of November 1 and 8, 2010
Employee and Retiree Benefits Open Enrollment Meetings
November 15-30, 2010 Benefits Open Enrollment Period
December 2010 Submit enrollment files to insurance carriers
January 1, 2011 Benefit plans effective date
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