RACINE — The city’s actuary has calculated the premiums for the 2020 health insurance plans. For retirees under 65, their premiums are higher than expected.
Since the 2020 premiums were set at 7.5%, they should fall somewhere halfway between the two health plans from last year, which were 5% and 10%. And for most employee groups, they are; the exception is the retirees under 65, whose premiums are not much lower than the 10% premiums from last year.
For 2019, active employees and retirees under 65 individuals had the option of a high-deductible plan with a lower premium of $35.59, or a low-deductible plan with a higher premium of $74.50. For active employees, the 2020 premium will be $51.13, which is less than halfway between last year’s premiums.
For pre-65 retirees, on an individual plan their premium for next year is $70.98, $3.52 less than the 2019 10% premium.
The same differences are shown with the family plan. Last year the lower premium was $93.95 and the higher was $196.69. For 2020, the active employees’ premium is $134.99 which is, again, less than halfway between last year’s premiums.
For the pre-65 retirees, it is $187.39, $9.30 less than the 2019 10% premium.
City officials stated that the city’s actuary, Milliman, which has an office in Brookfield, calculated the active employees and pre-65 retirees in two separate pools, whereas in previous years the active employees and pre-65 retirees were calculated together. The premium rates for 2020 are based on those groups’ actual claims as calculated by Milliman.
Medicare Advantage premiums and grandfathered Medicare-eligible retirees’ premiums were less than halfway between the 5% and 10% premiums from last year.
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Medicare Advantage premiums for 2020 are set at $40.19 for an individual plan and $80.37 for a family plan. The grandfathered Medicare-eligible retirees premiums are set to be $47.05 for individuals and $94.11 for a family plan.
Health changes controversy
The changes to the city’s health insurance plans came after several contentious meetings and protests by city workers.
For 2020, active city employees will only have one plan available that sets employee contributions at 7.5% ($55 a month for an individual and $145 a month for a family) with an in-network deductible of $3,000 for the individual plan and $6,000 for the family plan. The maximum out-of-pocket costs would be $4,000 for an individual and $8,000 for a family.
After the deductible, the new plan requires a $200 emergency room copay that would be waived if the patient is admitted, a $75 urgent care copay, a $49 telemedicine copay, a $30 primary care office visit copay and a $60 specialist office copay. At the City Wellness Clinic, they would have to pay a $4 copay. Any preventative treatment would be covered 100% without a deductible.
Instead of a separate prescription drug deductible, drug payments will contribute to the overall deductible. Once the deductible is met, the copay is determined by what tier the medicine is set at: Tier 1 is $10, Tier 2 is $35, Tier 3 is $50 and Tier 4 is $150.
The proposal would have removed Medicare B reimbursements for spouses, not permit retirees to use the City Wellness Employee Health Center at 2333 Northwestern Ave. Suite 114, but those specific segments were removed from the proposal before it passed.
On Oct. 31, the council passed a health savings account contribution schedule that was staggered according to employee income so employees who earned more would receive a lower contribution than employees on the lower end of the pay scale. It also included a $500 bonus for employees who lived within the City of Racine.
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