What's New This Year?
While average health plan costs have risen sharply over the past decade, the University community has been successful at limiting such increases and their impact on our our health plan members. Though our underlying cost increases have remained well below the national average, our overall health plan costs have still risen $89 million over the past 12 years. Fortunately, the University has absorbed most of that increase on our employees’ behalf. Since 2004, employees have seen only modest (and rare) out-of-pocket premium increases. As a result, our faculty and staff have continued to enjoy high quality care without the dramatic cost increases not uncommon with other employers’ plans.
Benefit Plan Rates for 2014-15, Effective July 1
With a recent change in health plan administrators and minor prescription plan updates, we will once again see limited increases in underlying health plan costs (2 percent, or $2.6 million dollars). Fortunately, the University will once again absorb most of that increased cost on our behalf. For the 2014-15 plan year that begins July 1, UK-HMO, UK-RHP, and UK-PPO rates will increase slightly for the new plan year for all regular employees with a .75 FTE or greater: Employee-only monthly rates will increase by $1, and family monthly rates will increase by $7. UK-EPO will increase slightly more, the UK-EPO single employee rate for a regular employee with a .75 FTE or greater will increase by $8 per month. Delta Dental, EyeMed vision and optional life insurance rates will remain unchanged for the year ahead. Accidental Death & Dismemberment rates will actually decrease (and higher levels of coverage will be available). The UK-RHP network will change from 7 regions to 2 regions.
Broader Therapy Coverage
Music therapy will be added to the group of therapies available for all plans. In addition, the combined limit on therapies will be increased from 30 to 45 on the UK-PPO and UK-EPO plans to match the 45-visit therapy limit already in place on the UK-HMO and UK-RHP plans.
Copayment Adjustments for Certain Services under UK-HMO and UK-RHP Plans
There are two copayment changes to the UK-HMO and UK-RHP plans as well. The high end diagnostic services and hospital observation stay copayments will each increase $25 effective July 1. Specifically, copayment for high cost outpatient diagnostic testing (e.g., MRI, MRA, CT, SPEC, and PET scans) will increase from $50 to $75. Copayments for observation hospital stay copayment will increase from $75 to $100.
Dependent Optional Life Insurance
Dependent optional life insurance now starts at the $10,000 coverage level, with higher levels of coverage ($15,000 and $20,000) also available. Formerly, coverage offerings started at $5,000. If you had $5,000 coverage, your coverage level will automatically increase to $10,000 unless you elect otherwise.
Out-of-Pocket Maximum Changes
To address a requirement of federal health care reform, all copayments and deductibles will now count towards each plan’s out-of-pocket maximum. With this change, out-of-pocket maximums have been increased to account for this requirement. Out-of-Pocket maximum calculations will now include all medical copayments, coinsurance and deductibles and have been increased as follows to reflect this change:
UK-HMO, UK-RHP, UK-EPO
- UK HealthCare Provider (Tier 1): $2,500/member; $5,000/family
- UK-PPO In-Network (Tier 2): $2,750/member; $5,500/family
- Out-of-Network (Tier 3): $7,500/member; $15,000/family
This change, which includes higher out-of-pocket maximums that now include all medical copayments, coinsurance (except prescriptions) and deductibles, is not generally expected to change average costs for plan members.
Health Care Flexible Spending Account (FSA)
The Health Care Flexible Spending Account (FSA) offered through UK is a convenient way for you to pay for eligible medical expenses with tax-free dollars. When you choose to take advantage of the FSA, you receive a debit card to make your qualified purchases so that, in most cases, you can enjoy paperwork-free, instant reimbursement. In the current and previous plan years, any amount contributed to your FSA that was left unused at the end of the plan year’s 2 ½ month “grace period” beyond June 30 was lost to you, the employee. We are pleased to announce that beginning in the 2014-15 plan year, unused funds up to $500 will simply be carried over from one plan year to the next. This change was based directly on your feedback! When the federal government recently offered the new $500 “rollover” option, we asked our employees to choose: The current 2 ½ month grace period to use FSA funds OR the new $500 rollover option?
In January 2013, we asked UK employees to participate in surveys asking where they stood on the matter. The results are in, the people have spoken! Of those currently participating in health care FSAs, 77 percent of those who took the survey said that they would prefer the rollover option. Of those not currently enrolled in a flexible spending account , 54 percent indicated they would be more likely to participate with the new rollover option. Given these results, UK chose to implement the new $500 rollover benefit. What does this mean to you? If you contribute $2,500 (still tax free!), for example, to your Health Care Flexible Spending Account in the 2014–15 plan year, but only spend $2000 you roll over the remaining $500 for use any time during the 2015–16 plan year! We thank everyone for their input. We hope that this adds more convenience to your current FSA, or encourages you to consider taking advantage of this benefit if you aren’t currently enrolled.