Members of the University System of Georgia’s health insurance plans will likely see some of the highest cost increases ever next year as the system moves to control the climbing cost of health care.
As the cost of care goes up, the 105,000 faculty, staff, retirees and their beneficiaries covered by the plans are likely to pay more in health care premiums, deductibles, out-of-pocket expenses and co-pay costs. The plan changes, approved Tuesday by the University System’s governing board to take effect Jan. 1, range from a 6 percent decrease in premiums for the comprehensive care plan to about a 24 percent increase in premiums for the other plans offered by the system. Under the new policies, employees will cover about $14 million of the system’s health care costs next year.
The changes are part of a three-year plan to move the University System’s health coverage to a defined contribution system. With defined contribution plans, the University System would allocate a certain amount for each of the four offered plans, and employees would be responsible for paying anything beyond that amount. The University System currently pays about 70 percent of the premium for each plan, with employees paying the remaining 30 percent. Those percentages would change under the defined benefit plan, which the system is scheduled to have fully in place by 2017.
“The values of our plans are high, and what employees are paying doesn’t match up,” said Marion Fedrick, the USG’s vice chancellor of human resources. “… At some point it becomes unaffordable and you don’t want it to get to that point.”
For its part, the Board of Regents expects to spend about $520 million, or $37 million more on health insurance next year than in 2014, if it wins the Legislature’s approval. It would bring in about $1.1 million by increasing the surcharge paid by smokers from $50 to $75, and it would add benefits for autism therapy for children under age 6. The Legislature failed to pass a mandate for autism coverage during the most recent legislative session, but Gov. Nathan Deal included $2.4 million for autism treatment in the fiscal 2015 budget.
The health care cost increases make up part of the University System’s fiscal 2016 budget request. The $1.99 billion request for that budget, which will begin July 1, would increase the University System’s operating budget by $46.4 million, or 2. 4 percent, over the current year. The $235.6 million capital budget request includes construction for eight projects and $60 million in major repairs and renovations. The budget request now moves to the governor for consideration.
The University System health plan is independent from the $3 billion State Health Benefit Plan, which covers about 650,000 teachers, state employees, retirees and their dependents.
That plan has been a headache to Deal and state officials throughout 2014. Changes the state made to save $200 million a year caused a backlash from teachers and retirees, who said they got fewer benefits and had to pay more out-of-pocket expenses. While Deal and the Department of Community Health have made changes since then, problems with the program have continued to plague the governor’s re-election efforts.
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