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Trustees Approve 2019 Contribution Rate Changes

Aug. 06, 2018

On Aug. 3, Portico Benefit Services’ board of trustees voted to approve, on average, the lowest contribution rate increase in five years. This will include disability and survivor rate reductions, sizeable reductions in the cost of ELCA Medicare-Primary health benefits, and a low baseline ELCA-Primary health rate increase. While these changes will impact individuals and congregations differently, Portico’s responsibility as the ELCA’s benefit ministry is to support the long-term interests of the community as a whole.

At this meeting, trustees also approved several health plan adjustments that will:

  • Increase deductibles and out-of-pocket maximums for the Gold+ and Platinum+ ELCA-Primary benefit options
  • Adjust the cost of coverage for spouses, children, and families relative to “member only” coverage
  • Increase the affordability of the ELCA Medicare-Primary health benefit Economy option

Rev. Jeff Thiemann, Portico’s president and CEO, praised Portico’s ability to hold the line on costs while delivering high-quality benefits. “Thanks to our long-term plan management approach, our strong negotiating position with vendors, our knowledge of the evolving benefit industry, and our ongoing commitment to innovation, as many as 50% of ELCA sponsoring employers are projected to see lower aggregate costs for health, disability, and survivor benefits next year. While this is unlikely to happen each year, cost reductions of any kind are an important indicator that our long-term cost containment efforts are working.”

Josh Smith, Portico’s director of health products, emphasized the importance of implementing benefit changes incrementally. “One of our priorities is to create stability for those paying for and using our benefits. As a self-insured plan, we continuously analyze claim trends to identify opportunities to adjust our benefits and pricing. Last year, for example, we adjusted prescription drug pricing, and this year, we’re adjusting hospital and medical deductibles.”

Sponsoring employers can estimate their 2019 costs using their Custom Comparison Report on EmployerLink starting in mid-August. See the chart below for a summary of contribution rate and benefit changes.

Innovation Is Key: Cutting-Edge Service Helps Rein in Health Costs

In 2017, Portico introduced a cutting-edge Care Coordinator model to its ELCA-Primary health plan members as a first step toward building a health plan centered around personalized health support. Since then, it has rolled out three additional personalized health programs to ELCA-Primary health members: the Livongo for Diabetes program for members with type 1 or type 2 diabetes, the Omada® program for members at risk for type 2 diabetes and heart disease, and Quest Diagnostics biometric screening, which delivers personalized health insights to participating members.

That commitment to personalized care is now beginning to pay off. “Our first priority was to connect ELCA-Primary plan members with Care Coordinators by Quantum Health,” said Smith. “These professionals are effective listeners, skilled at helping members find the right care for their needs, and, in the process, save them time and money. We expected this service to reduce claim costs, and now, 18 months in, we can see that we’re saving significantly more than expected — enough to rein in this year’s health contribution rate increase.”

Smith emphasized that, while cost savings are important, it’s equally important that members value the service. One anonymous member describes what many have reported. “I wasn’t sure about the Care Coordinators when Portico announced them last year. But I had a very positive experience with them when my wife had a difficult birth that needed follow-up care for our new baby. Now I tell everyone to take advantage of them.”

How, specifically, are Care Coordinators creating cost savings? Smith offers these examples: “While 75% of members have contacted a Care Coordinator, 95% of members with serious health issues — those considered higher-risk — are working with a Coordinator to guide their care and reduce redundant tests and procedures. Also, Coordinators have made over 330 referrals to Portico’s online medical care option, the Employee Assistance Program (EAP) counseling benefit, and Livongo for Diabetes management support. Each referral represents a different type of cost savings for the health plan and for our members.”

While it’s still too early to report specific savings related to the three additional programs, members are making good use of them. At mid-year:

  • 48.4% of eligible members with diabetes were enrolled in Livongo, compared to Livongo’s typical enrollment rate of 35%.
  • Just over 850 members at risk for type 2 diabetes and heart disease have enrolled in the Omada® program, logging a collective 6,411-pound weight loss thus far.
  • 25% of eligible members and spouses completed a biometric screening, a positive outcome to date given the difficulty of promoting an in-person screening to a geographically dispersed member population.

Knowing When to Change Things Up: Solving ELCA Medicare-Primary Health Issues

Also significant for 2019 are decisions made this spring by the ELCA Church Council and Portico’s board of trustees to address issues related to the ELCA’s ability to continue retiree health benefits for churchworkers. Given long-standing subsidy funding concerns and decades of dramatically increasing health care costs, the ELCA Church Council voted to change the ELCA health subsidies provided to eligible retirees and family members. In 2019, subsidies will become a fixed dollar amount instead of a percentage off the monthly health contribution, with the amount expected to increase 3% per year beginning in 2020, as approved by the ELCA Church Council.

Portico’s board of trustees approved a proposal to change ELCA Medicare-Primary health coverage. Effective Jan. 1, 2019, coverage will change from a Medicare supplement benefit to hospital and medical benefits insured by Humana as a group Medicare Advantage plan. In its negotiations with Humana, Portico was able to preserve robust coverage and an extensive provider network, add new wellness benefits, and secure sizeable rate reductions for most members in 2019.

As the ELCA’s long-serving first secretary and now as interim bishop, the Rev. Dr. Lowell G. Almen has been involved with or observed the ELCA’s efforts to address rising health care costs for over 30 years. “Early on,” recalled Almen, “we realized that adjustments needed to be made in the retiree medical subsidy program to maintain that commitment over time. I was part of the review process for those early adjustments, and more recently through the Conference of Bishops, I’ve been made aware of the changes Portico is making to the retiree medical plan for 2019. I believe that these changes use the ELCA’s purchasing power wisely to lower costs and expand choices for retirees.”

Learn more about ELCA Medicare-Primary health changes

2019 Contribution Rates

For ELCA Employers Sponsoring Members in the ELCA Traditional Benefits Program

The following contribution rate changes will be effective Jan. 1, 2019. Note: Because they are applied as a percentage of a member’s defined compensation, contributions will also change when a member’s compensation changes.

ELCA-Primary Health Benefits

The baseline health contribution increase will be 4.5% in 2019 for all four benefit options.

This is Portico’s lowest increase since 2013. (Reminder: Health contributions also increase 2%, on average, each year due to the increased age of a sponsored member.)

In addition, the relative cost for each coverage level is changing: member; member and children; member and spouse; member, spouse, and children.
Based on analysis of health claims incurred by each category over time, trustees approved the following changes to better align contribution rates with health claim realities.

  • The cost of member (single coverage) will go down by about 6%.
  • The cost of member plus family coverage will go up:
    • by about 2.1% for member and spouse, or member and children
    • by about 1.5% for member, spouse, and children

ELCA Medicare-Primary Health Benefits

The contribution rate will go down for sponsoring employers by about 16%.
About 20% of employers provide ELCA Medicare-Primary health benefits to employees age 65+. This contribution rate will decrease by about 16% in 2019, thanks to the decision to change to hospital and medical benefits insured by Humana as a group Medicare Advantage.

ELCA Disability Plan

The contribution rate will go down to 2.5%.
Due to effective vendor selection and management of the disability plan, this rate will decrease from 3.0% of defined compensation to 2.5%.

ELCA Survivor Plan

The contribution rate will go down to 0.2%.
Due to effective management of plan assets, this rate will decrease from 0.3% of defined compensation to 0.2%.

ELCA Retirement Plan

No change to required minimum contributions.

ELCA Retiree Support

Continues at 0.7%.

For ELCA Employers Sponsoring Members in the ELCA Flexible Benefits Program

The ELCA-Primary health benefit baseline increase and the Survivor Plan decrease will apply for employers sponsoring employees in the ELCA Flexible Benefits Program. The Disability Plan rate for these employers is not changing.

For Individuals Continuing ELCA-Primary Health Benefits

Health contribution rates will increase by 4.5% for all four health benefit options, in addition to the annual 2% average increase due to age.

For Individuals Continuing ELCA Medicare-Primary Health Benefits

ELCA Medicare-Primary Health Benefits

Contribution rates will go down in 2019.
Portico negotiated rates for hospital and medical benefits insured by Humana as a group Medicare Advantage plan, resulting in the following reductions in monthly contributions for 2019.

  • Economy: Monthly contribution will decrease from $376 to $224
  • Standard: Monthly contribution will decrease from $393 to $299
  • Premium: Monthly contribution will decrease from $445 to $339

Important:

  • Retired members who are eligible for ELCA Medicare-Primary benefits and have a valid health coverage waiver will remain eligible to reinstate their ELCA coverage at any time. Contact Portico for details.
  • Retired members who are eligible for ELCA Medicare-Primary benefits and an ELCA health subsidy, and have a valid health waiver, must reinstate coverage effective Jan. 1, 2019 and remain enrolled in order to receive a subsidy in 2019 and beyond. To reinstate coverage, contact the Portico Customer Care Center at 800.352.2876 no later than Friday, Oct. 5, 2018.

2019 Benefit Changes

ELCA-Primary Health Benefits

Gold+ and Platinum+ deductibles and out-of-pocket maximums will go up.
When possible, Portico tries to implement benefit changes incrementally to maintain as much stability as possible for members. After making changes to prescription drug benefits for 2018, no changes will be made to the prescription drug copayments and coinsurance for 2019.

To preserve the desired cost sharing between employer contributions and member out-of-pocket costs, 2019 medical deductible and out-of-pocket maximums for the Platinum+ and Gold+ options will increase. (Deductible and out-of-pocket maximums for Silver+ and Bronze+ will not change.)

Platinum+
Individual

  • Deductible will increase from $500 to $550 per person
  • Out-of-pocket maximum will increase from $3,000 to $3,200 per person

Member and Children

  • Family deductible will increase from $750 to $825
  • Family out-of-pocket maximum will increase from $6,000 to $6,400

Member and Spouse

  • Family deductible will increase from $1,000 to $1,100
  • Family out-of-pocket maximum will increase from $6,000 to $6,400

Member, Spouse, and Children

  • Family deductible will increase from $1,000 to $1,100
  • Family out-of-pocket maximum will increase from $6,000 to $6,400

Gold+
Individual

  • Deductible will increase from $1,200 to $1,300 per person
  • Out-of-pocket maximum will increase from $3,800 to $4,100 per person

Member and Children

  • Family deductible will increase from $1,800 to $1,950
  • Family out-of-pocket maximum will increase from $7,600 to $8,200

Member and Spouse

  • Family deductible will increase from $2,400 to $2,600
  • Family out-of-pocket maximum will increase from $7,600 to $8,200

Member, Spouse, and Children

  • Family deductible will increase from $2,400 to $2,600
  • Family out-of-pocket maximum will increase from $7,600 to $8,200

ELCA Medicare-Primary Health Benefits

Changing to a group Medicare Advantage plan.
Portico has selected Humana to insure ELCA Medicare-Primary members’ 2019 hospital and medical benefits as a group Medicare Advantage plan, replacing today’s Medicare supplement administered by Mercer.

  • Members can expect continued robust coverage and new wellness programs. Benefit details will be available from Portico and Humana starting in late-September.
  • Delta Dental will continue to administer the same dental benefits.
  • Prescription drug copayments and coinsurance for the Standard and Premium options will not change, given last year’s changes to ELCA prescription drug benefits administered by Express Scripts.
  • To make the Economy option an even more low-cost choice for those with minimal prescription drug needs, it will be structured more like a traditional Part D benefit featuring a deductible, coverage gap, catastrophic coverage, and a closed drug formulary (non-formulary drugs are not covered unless medically necessary). To minimize disruption to current prescriptions, those in the Economy option who don’t select a 2019 option during this fall’s Annual Enrollment will be assigned the Standard option for 2019.
  • Because Medicare Advantage plans don’t include international coverage, ELCA Medicare-Primary members living outside the U.S. and its territories (less than 0.1% of current ELCA Medicare-Primary members) will not be eligible for 2019 coverage.