Begin to plan for health care changes in January

Employees are encouraged to begin planning now for changes to the university's health care plan on Jan. 1, including higher monthly premiums and some new shared costs for medical services. The changes were summarized in a Sept. 18 memo from university leaders and received final approval Sept. 28 from the state Board of Regents. Full details will be available Oct. 2 on the benefits' open enrollment website.

Overall health care coverage -- the range of services covered by employees' insurance plan -- will not change in the new plan year.

The cost-sharing changes come on the heels of three years of incremental premium adjustments that have failed to fully close a widening gap between total health care claims paid and premiums collected.

Iowa State contracts with Wellmark to administer its health care plan, but the university self-funds that plan and so must cover the difference when claims exceed premiums. More than 15,000 individuals -- employees, their partners and family members -- are covered by the ISU Plan. The university covered those differences -- at least $7.4 million each of the last two years -- from other funding sources; however, that's not a sustainable solution, said Ed Holland, director of benefits, university human resources.

Employees pay about 12% of the university's total health insurance premium each month, he noted. The remaining 88% is paid by their employing unit, one component of their overall fringe benefits package.

University also is taking on more costs

Depending on the plan and who's covered in it, employee monthly premiums will go up $4-$41 in the HMO plan and $6-$43 in the PPO option (see chart below). The university portion of all premiums is rising, too. To further address rising health care costs, key changes were made to the cost-sharing structure in both the HMO and PPO plans that will impact employees' out-of-pocket costs. Holland noted that even with these increases, ISU employee costs will remain significantly lower than in plans offered by other colleges and universities, as well as many private employers.

The HMO plan introduces an annual deductible, coinsurance and an annual out-of-pocket maximum. The PPO plan also adds an annual deductible requirement and bumps the coinsurance rate from 10% this year to 20% in 2024. Existing out-of-pocket caps for PPO participants aren't changing.

An expanding list of preventive health services and medications, authorized by the federal Affordable Care Act of 2010, will be fully covered without a copay or coinsurance in both the HMO and PPO plans. Starting in 2024, even the $15 office co-pay is waived on these services, which include annual wellness exams, immunizations and many kinds of health and mental health screenings.

What's not changing in 2024

There are no changes to covered services in the ISU Plan in 2024. There also are no changes to the plan's prescription service with Express Scripts. And that list of preventive health services will be fully covered without co-pays or coinsurance. Finally, coverage in Delta Dental's two plan options -- basic and comprehensive -- remains the same in 2024.

New mindset: Health care budgeting

Tackling higher health care claims solely with premium increases would distribute that expense across all participants, ignoring their actual use of the ISU Plan. However, also adding cost-sharing changes is a more balanced approach and encourages employees to be more involved in managing their own health care, in some cases contributing to efforts to lower costs. Taking advantage of the free preventive services each year is a good start, Holland said.

With Iowa State's annual health and dental insurance enrollment window scheduled for Nov. 1-17, he encouraged employees to use the next six weeks to learn more about the changes to the two plan options.

"Learning is where we want our employees to be. Learn as much as you can to be better prepared for the changes coming in January," he said.

How to learn more

Holland will lead a benefits virtual town hall for faculty and staff on Wednesday, Oct. 4 (9-10:30 a.m., via Webex). He'll walk participants through the plan changes and answer broadly applicable questions about the changes.

He encouraged employees who prefer a 1-on-1 conversation to schedule time with one of the four benefits specialists, each of whom is assigned to a faculty-staff group by their last names alphabetically. Starting next week, the Bookings app in Microsoft Teams will help employees make an appointment (virtual or in-person). Select a benefits specialist on the 2024 open enrollment website (scroll to "meetings with benefits office staff.") They also can be reached via the service center phone line, 294-4800.

For those who like to do their own research first, the benefits staff last fall introduced ALEX, a virtual and interactive benefits tool that  explains how ISU's benefits work, analyzes the pros and cons of different offerings, asks questions that can help inform choices and proposes personalized suggestions for what benefits to select. On Monday, Oct. 2, ALEX will roll out with the 2024 ISU Plan data so the tool is helpful leading up to November's enrollment period.

The Oct. 12 edition of Inside Iowa State will be devoted to resources and tools to help employees understand the plan changes and prepare for their plan enrollment.

A comparison with peers

As mentioned, even with the increases, ISU employees' premiums remain below the national median for colleges and universities. According to data from the College and Universities Professional Association for Human Resources, for HMO plans, the national median employee premium for single coverage is $128/month compared to $33/month for Iowa State's plan, and family coverage is $449/month compared to $234/month for Iowa State's plan. Among PPO plans, the national median employee premium is $155/month for single coverage compared to $55/month at Iowa State, and $597/month for family coverage compared to $425/month at Iowa State.

Plan year 2024: Medical monthly premium increases

Plan year 2024: Dental monthly premium increases