GIC Rates Hold Steady For FY15

MAY 2014 VOICE: Members, who are state and municipal retirees receiving their health insurance through the state’s Group Insurance Commission (GIC), received welcome good news in March – health insurance premiums for FY15 will remain largely unchanged.

Insurance premium contribution percentages paid by state retirees are also expected to remain unchanged. Since 1991, state policy has been to cap retiree contribution percentages at the level paid upon retirement. The result is three different contribution rates  – 90/10, 85/15 and 80/20 – that are set depending upon the date of retirement.

Association officials are fighting to bring about the same policy for municipal retirees, whereby one would be grandfathered at the percentage paid upon retirement and no longer allow cities and towns to change current retiree percentages.

GIC Meets

Led by Executive Director Dolores Mitchell, the 15-member Commission unanimously voted to approve the contracts and FY15 rates for the 6 Medicare and 12 non-Medicare plans. Across all GIC plans, the average premium increase is just 1%. For Medicare plans alone, the increase registers 1.4%.

However, those members insured under the GIC’s popular Optional Medicare Extension (OME) plan will see their monthly premium go down by -0.4%, which amounts to $1.39 less on the total cost of the OME monthly premium.

Beginning in June (insurance premiums being deducted a month in advance), Medicare enrolled retirees, under the UniCare State Indemnity Plan OME will pay $48.13 (10%), $66.80 (15%) or $85.47 (20%) per person. This is in addition to the $104.90 monthly premium for Medicare Part B.

Non-Medicare retirees, insured under the UniCare Basic Indemnity Plan face a slight premium increase of 1.8% over FY14. Massachusetts-based Harvard Pilgrim Healthcare and Tufts Health Plan offer PPO products that have become increasingly popular with pre-Medicare retirees. Harvard’s Independence PPO will see a 0.9% increase, while Tufts Navigator will see a -1% to -1.5% decrease in monthly premium.

No Copayment Increase

As previously reported, the majority of the GIC’s copayments remain identical to their current FY14 levels, as does the non-Medicare annual deductible of $250 per person ($750 max per family). Most of the GIC’s Medicare plans carry a $35 annual deductible.

“We now have five consecutive years of both stable premium contributions and a freeze on out-of-pocket cost increases. This is great news for those members who receive their insurance through the state’s GIC,” explains Shawn Duhamel, who leads the Association’s healthcare policy team. “Cities and towns are also beginning to report little to no health insurance premium increases for the coming year.

“While it is too early to declare victory over healthcare cost inflation, the steps Massachusetts has taken over the past several years do appear to be working. If these trends continue, it really should help silence the critics who’ve been calling for severe cuts in retiree healthcare benefits and requiring retirees to pay more.”