1Karen Benson, Healthcare Network Program Manager, SHBP

State Health Benefit Plan Update Presentation to

HomeTown Health, LLC

Department of Community Health December 17, 2008

www.dch.ga.gov/shbp_plans

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ACCESS

Access to affordable, quality health

care in our communities

RESPONSIBLE

Responsible health planning

and use of health care resources

HEALTHY

Healthy behaviors and

improved health

outcomes

DCH Mission

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FY 2008 FY 2009

DCH InitiativesFY 2008 and FY 2009

Medicaid Transformation

Health Care Consumerism

Financial & Program Integrity

Health Improvement

Solutions for the Uninsured

Workforce Development

PeachCare for KidsTM Program Stability

Customer Service

Medicaid Transformation

Health Care Consumerism

Financial Integrity

Health Improvement

Solutions for the Uninsured

Medicaid Program Integrity

Workforce Development

PeachCare for KidsTM Program Stability

SHBP Evolution

Customer Service and Communication

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SHBP Mission

Execute a five year health care strategy with consumer driven

health care and consumerism as a key part of the strategy

Key Objectives• Promote consumerism• Streamline administration by consolidating options and

vendors• Maintain provider access and member choice• Meet financial target• Opportunity for long term success

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High Level Strategy (2009 – 2013)• Streamline options to offer two statewide health plan vendors, each

offering four choices for active employees: – HRA (CDH Plan)– HDHP (CDH Plan)– PPO– HMO– Medicare Advantage Plan (for Medicare eligible retirees)

• Develop plan designs and incentives that promote consumerism and encourage members to engage in healthy behaviors

• CDH plan designs will be improved each year (one percent addition in actuarial benefit value each year starting in 2009)

• Consumerism features such as deductibles and coinsurance will be added to the HMO and PPO each year (two percent reduction in actuarial benefit value each year starting in 2009)

• Strategic pricing utilized to provide incentive for CDH plans• Expect gradual enrollment shift from HMO/PPO plans to HRA and

HDHP plans• Savings achieved on active population reduces OPEB liability

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Procurement for 2009 Contracts • In accordance with the multi-year strategy to streamline

administration and focus on consumerism, SHBP conducted a procurement to identify two vendors who could offer the required five products on a statewide basis

• More than half of SHBP’s covered population lives outside metro Atlanta, and while members had very strong coverage and numerous choices in metro Atlanta, they were lacking choice in the rest of the state

• In the procurement evaluation, statewide access to a comprehensive network of providers was the category awarded the most points – over 1/3 of the total points available

• Legislation allowing SHBP the flexibility to not offer CCO (due to low utilization) was passed during 2008 Session

• In August 2008, DCH Board approved removal of CCO and Indemnity options from 2009 suite of products

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Impact to employees• Impacted employees/retirees:

– BCBSGa: 79,656– Kaiser: 21,241– Indemnity: 4,386– CCO: 6,419

• Based on claims analysis, over 97% of physicians utilized by the BCBS members are participating in the CIGNA and/or UHC networks

• Due to the unique nature of Kaiser’s staff model HMO, the decision was made to allow Kaiser members an additional year to research and select new physicians; therefore Kaiser will be offered to current Kaiser members for 2009

• Combining the 3% disrupted BCBS members and 100% of the Kaiser members, less than 7% of entire SHBP membership will be impacted by physician-patient disruption

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Q1 2008 SHBP Product Performance

Q1 2008 SHBP Product Performance Per Member Per Month Claims

$268

$362

$449

$137

$184

$0

$50

$100

$150

$200

$250

$300

$350

$400

$450

$500

Consumer Driven HealthPlan - HDHP

Consumer Driven HealthPlans - HRA

HMOs PPO INDEMNITY

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Benefit Changes • Full Mental Health Parity on all options• HRA plan enhancements:

– $125 additional “cash” added to HRA accounts ($250 for employee + spouse) for members who get an annual preventive care screening and complete a Health Assessment

– No cost for certain drugs for members with diabetes, asthma and cardiac conditions who remain enrolled in and actively compliant with the Disease Management program guidelines

• Out-of-pocket maximums, some co-pays and some deductibles will be changed to provide more comparability between plans and further incent members into the consumer-directed plans

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Medicare Advantage Plans

• Two Private Fee for Service (PFFS) plans covering entire state

• Optional for Medicare-eligible retirees• Automatically covers all parts of Medicare (A,B,C,D) • Benefits enhanced over standard Medicare to cover:

– $1,000 annual out-of-pocket maximum and lower co-pays – Unlimited inpatient hospital days– No hospital stay required prior to Skilled Nursing Facility– Worldwide emergency room coverage – Routine Chiropractic visits– Routine Podiatry visits– Routine vision exams and hardware ($125/2 years) – Hearing exams and hearing aid benefit ($1,000/4 years)

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2008 Open Enrollment (OE) Activities

• 2009 OE: October 10 – November 10 • Letters to all members impacted by plan option

changes were mailed in July/August• Personalized benefits statements modeling which

plan option would result in lowest out-of-pocket costs (utilizing employee’s actual 2007 claims) will be mailed to all employees’ homes prior to OE – hand out

• Over 1,500 Webinars and face to face educational meetings will be conducted in preparation for OE

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SHBP Subscribers Enrollment 12 Plan Options:• PPO • HMO• HRA• High

Deductible Health Plan

• Medicare Advantage Private Fee for Service

– Cigna– United

Healthcare

• HMO• Senior

Advantage– Kaiser

94400

3789

107696

14599

2771

46823

5067513

10928

318 109 24260

20000

40000

60000

80000

100000

120000

UHCPPO

CignaPPO

UHCHMO

KaiserHMO

UHCHDHP

UHCHRA

CignaHRA

CignaHDHP

CignaHMO

CignaMA

KaiserMA

UHCMA

UHC PPO Cigna PPO UHC HMO Kaiser HMO

UHC HDHP UHC HRA Cigna HRA Cigna HDHP

Cigna HMO Cigna MA Kaiser MA UHC MA

January 2009

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Healthcare Vendor Sample ID Cards

See . . .

Exhibit A – CIGNA Healthcare, Inc.

Exhibit B – UnitedHealthcare, Inc.