Members of the State Health Plan will see higher premiums and new wellness surcharges in 2016-17 after the Board of Trustees’ unanimous vote Wednesday, unless the General Assembly can be persuaded to make changes.

The biggest change announced Wednesday from the original proposal presented in January was to the Traditional 70/30 PPO, which had been the premium-free option.

The original proposal for the PPO 70/30 was to establish a $60 premium for active employees and allow them to reduce that to $20 with completion of a wellness surcharge activity.

That idea, however, came under fire in January from several trustees, including SEANC member Charles Johnson, and those who spoke during the public comment period, including SEANC lobbyist and health care expert Chuck Stone.

On Wednesday it had been changed to establish a $40 premium that could be reduced to $0. However, even though it now has a premium, it is still grandfathered in under the Affordable Care Act and will NOT include any free preventative health care benefits.

Here are the highlights of the changes, broken down by plan option:

Consumer-Directed Health Plan (CDHP) with HRA

• Add a premium surcharge of $40
• Allow healthy activity credits to reduce premium to $0
• Increase state HRA contributions from $500 to $600 for individuals and $1,800 for families
• Increase member out-of-pocket expenses from $3,000 for individuals and $9,000 for families, to $3,500 for individuals and $10,500 for families
• Additional, to-be-announced, state HRA contributions for members with chronic conditions and those enrolling in healthy lifestyle programs

Enhanced 80/20 Plan

• Double premium surcharges from $40 per month to $80 or more per month
• Allow premium surcharge credits to reduce premium to $15
• Possibly add new wellness requirements, which may or may not include one or more biometric screenings such as blood glucose, blood pressure, cholesterol and possibly BMI (body mass index)
• Increase Tier 5 (non-preferred specialty medications) pharmacy co-insurance maximum from $125 per month to $132 per month

Traditional 70/30 Plan

• Establish a $40 premium surcharge (active employees)
• Allow premium surcharge credit to reduce premium to $0 (active employees)
• Establish premium surcharge credit – tobacco attestation (active employees)
• Increase generic drug co-pays from $12 to $15.
• Increase co-pays, deductibles, co-insurance maximum & pharmacy out-of-pocket maximum (active employees/retiree)

One area still not addressed by the changes that concerned several board members and speakers Wednesday, including Johnson and Stone, was the lack of improvement for dependent coverage. The problem, Stone said, is that the burden of dependent coverage is placed entirely on the member, and he asked that the trustees implement direct premium subsidies for member dependents.

Currently, according to a recent comparative study of state health plans by the SHP, North Carolina ranks last in affordability of total family coverage.

Making matters even worse is that the SHP is projecting a 3.37 percent dependent coverage premium increase for 2016 with even higher ones to come.

“The proposals before you today still do not make the plan affordable. They [state employees] can’t afford it for their dependents and it’s a major deficiency,” Stone said. “Increased cost sharing by State Health Plan members needs to be linked to their pay increases and what they have in their paychecks. Keep in mind they have to pay 100 percent of their dependent premiums … and they’re going to see premium increases exceeding 4 percent. Their pay raises haven’t even been 4 percent, so how are they going to pay for their dependents. They have no way of doing that.”

Stone went on to remind the trustees that SEANC has made numerous recommendations to save the health plan upwards of $300 million, such as eliminating overpayments for outpatient hospital care.

His comments were echoed later by Johnson who urged his fellow trustees to consider actions in the future to make the plans more affordable, especially for dependents, even as he said he would support the 2016 changes.

“Our plan is not affordable. It’s too expensive,” Johnson said. “Revenues have to be found somewhere else other than the workers.”

If the goal is to encourage members to use the health care options available to them and to lead healthier lifestyles, then, he explained, the insurance plans need to be cost effective enough to allow them to do so. Until then, he said, people can’t – and won’t – take advantage of them.

“At some point the plan has to become affordable, especially in dependent coverage,” Johnson said.

The next step now is for the General Assembly to decide in its new biennium budget what the state’s employer contribution will be in 2016-17. Once they do, the State Health Plan Board of Trustees will meet to finalize premium levels.

In the meantime, SEANC will be advocating in the General Assembly for lawmakers to increase or at least maintain its contribution level, as well as contribute to members’ dependents. If you have any questions or concerns, contact Stone at cstone@seanc.org or call 800-222-2758.

Click here for a summary of the plan changes.

Click here for a more detailed look at the plan changes.

Click here for a more detailed look at the wellness surcharges.

Click here for the full presentation by the State Health Plan on the changes.