Insurance premiums to increase next year

Mai Hoang

Western faculty and staff who enroll in the university’s insurance program next year will pay more for coverage – again.

Next year, employees will have to shoulder premium increases ranging from 17 to 68 percent more than what they pay this year. Those ranges include the $341 Western contributes per person per month for faculty and staff health insurance.

The $341 Western is contributing is $26 more than it contributed last year. The increase came from additional student tuition.

Some staff and faculty members said the increases are too much.

Religious Studies professor Jeffrey Samuels paid $305 a month for coverage last year. This year, under a similar plan, he will pay $481.

He said he will not be able to afford the extra expense and will enroll in a cheaper plan for 2003.

“It irks me, but what to do?” Samuels said. “We need insurance.”

Len Kogut, chairman of Western’s Benefits Committee, said Monday that rising health care costs are to blame for the increase in premiums.

Ransdell approved the committee’s recommendations Friday. The Board of Regents will have to vote on another of the committee’s recommendations – the decision to get a new third-party administrator.

Western will drop Medical Benefits Administrators, Inc. as its third-party administrator in 2003 and is negotiating a contract with Anthem, Blue Cross and Blue Shield.

Ransdell said he expects the contract to be approved before open insurance enrollment for faculty and staff begins later this month.

Kogut said the change in third-party administrators will be a positive move for Western. He said the company is bigger and will provide more in-network options for faculty and staff.

“Having a bigger network will help many people when they’re on vacation or traveling,” he said.

If the contract between Western and the company is approved, Anthem, Blue Cross and Blue Shield will also replace HCC Life as the university’s reinsurer.

That means the company would cover all Western insurance claims over $150,000. Currently, HCC Life is supposed to cover all claims over $75,000.

However, they didn’t cover the bone marrow transplant of Presley Nash, daughter of Western employee Staci Nash. Western will pay about $500,000 for the transplant.

Human Resources director Tony Glisson said the transplant, and legal fees, are part of the reason premiums have increased.

Glisson said having one company that acts as both the university’s third-party administrator and reinsurer will provide more efficient coverage.

“The transfer of information should be clean and prompt,” he said. “And there shouldn’t be gaps between our plan and our reinsurer on what should be covered.”

MedBen offered two plans. With Anthem, Blue Cross and Blue Shield, employees will have three plans to choose from.

In addition to Blue Cross High and Blue Cross Low, the benefits committee agreed to add a new plan option, Blue Cross Economy, that will offer the lowest premium rates of the three.

“We’re hoping for some of the folks that they will be able to afford something for catastrophic conditions, if they have those,” Kogut said.

Employees who enroll in a single coverage plan for next year will also see a dramatic change. Holders of the single plan – which traditionally costs less than the $341 contributed by Western – will no longer be able to place the leftover money from the university contribution in a flexible spending account.

In 2003, Western will provide funds for flexible spending accounts only to single employees who opt out of Western’s insurance plan.

Single employees who choose not to enroll in the program will receive $171 dollars – half of the university’s contribution – to place in an account. The other portion will be placed in a faculty and staff health insurance reserve fund.

History professor Patricia Minter, the faculty representative on the benefits committee, said next year’s premiums were the best the committee could come up with in a bad situation.

“Pretty soon, private insurance is going to be unaffordable for all but the wealthiest Americans,” she said. “. It’s a national crisis that WKU is a part.”

In Fall 2000, Western insurance premiums went up so dramatically that employees protested and the crisis received statewide attention.

Glisson said he does not expect similar protest over this year’s increases. He said he thinks faculty and staff will understand Western has done as much as it could to keep premiums down.

Several educational sessions for the insurance plan will be held this month for faculty and staff. Open enrollment for the insurance plan will be held November 25-27.

Reach Mai Hoang at [email protected]