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GIC Sets Insurance Rates For FY17
OME Prices Drop -7.2%
MARCH 4, 2016: Retirees who are enrolled in the state Group Insurance Commission’s (GIC) Option Medicare Extension (OME) plan received very good news this week – health insurance rates for FY17 will decrease by 7.2%.
Last year, OME enrollees experienced an increase of 6.5%. Two years ago, the same rates decreased 0.4%.
In addition, the GIC has voted to maintain the same copayments and deductibles that have been in effect for the past year, without any increase.
At her final meeting as Executive Director, Mitchell repeated her past statements cautioning against rapid increases in out-of-pocket costs. “We need to always be mindful that there are limits in what retirees can and should pay.”
For retirees not enrolled in Medicare, but rather the basic Indemnity Plan, premiums will increase 2.9% for FY17. Across all GIC health plans the average combined premium increase is 3.6%.
As is the case nationally, the driving factor for the increase in rates is the rising cost of prescription drugs. Specifically, so-called specialty drugs have caused a sharp increase in healthcare spending over the past two years. These are drugs designed to fight rare diseases and specific forms of cancer.
Pharmacy benefit plans, such as the new SilverScript plan, are designed to help combat these price increases. SilverScript is the drug benefit now offered through the OME plan.
“From what we understand the decrease in OME premiums is directly related to the success of the SilverScript program has had in stabilizing drug costs. This issue is now the top concern of all public and private health insurance plans across the country,” says Legislative Director Shawn Duhamel. “While not without some of its own problems, SilverScript appears to be doing exactly what it was intended to do. And don’t forget, the Commonwealth will also receive some $60 million a year from Medicare for participation in this plan. The overall result is lowered costs for retirees.”
Association officials are now analyzing information relative to the remaining health plans offered by the GIC. We will also publish the exact monthly rates for each plan, once they are available. Members should look to the May 2016 edition of the Voice for a complete report on FY17 GIC benefits.