Employee benefits board approves rate changes | NevadaAppeal.com

Employee benefits board approves rate changes

by Geoff Dornan, appeal capitol bureau

The plan lost more than $17 million from its reserves this past year because of rising health care costs and an unexpected jump in the number of major medical cases. One example used by Gov. Kenny Guinn was that there have been 22 liver transplants since the last legislative session.

To keep the plan solvent, workers were looking at more than 20 percent increases until Guinn and the Legislature voted to pump $18 million into the program.

Retirees, who were looking at even bigger increases in what they must pay, will see much more modest increases because of a change in the law that lumps them in with younger, generally much healthier active participants when rates are calculated.

Non-state participants in the plan will see the biggest increases because state law requires their health benefits be self-supporting. Active workers for local governments and other public entities in the plan will see their rates increase an average of 45 percent.

That was going to be more than 60 percent because their rates were also lumped together with their non-state retirees. But Plan Executive Officer Woody Thorne said the law mandates active and retired non-state participants be rated separately.

What that means, however, is that retired non-state members of the plan will see increases averaging 105 percent when the new rates take effect Jan. 1.

That will hit several thousand workers who retired from local governments that don’t offer retirement health benefits. State law allows those workers to join the state plan.

State workers won’t have to pay anything for themselves. Their premiums are paid by the state.

In the self-funded program, employees covering their entire family will see no change in what they currently pay in the self-funded program — $256.59. Families in the HMO program will see a 49 percent decrease to $179.58 monthly.

Employees covering only their spouse will face a 9 percent increase to $147.81 in the self-funded program and a 36 percent decrease to $103.45 in HMO. The employee covering children only with no spouse will get a 7 percent decrease to $112.62 under self-funded and a 22 percent decrease to $78.82 monthly under HMO.

Retirees covering themselves and their spouse will get a 9 percent decrease under self-funded and a 35 percent decrease under HMO.

For active non-state employees, the rate will climb from $322.08 to $468.42 in January under self-funded. Similar increases were ordered for those covering a spouse or the entire family — about 45 percent in each case.

Non-state retirees sticking with the self-funded plan will see their monthly cost more than double from $347.11 to $711.67. Again, similar increases — all over 100 percent — are ordered for retirees covering a spouse or family.

But non-state employees, both active and retired, will see almost no change in what they currently pay if they are in the HMO plan.

The changes, along with those approved Thursday, are designed to put the benefits program back on its feet financially. But lawmakers and the governor have already been told it will take another large cash infusion once the 2003 Legislature starts to finish the job.