The Empire Plan is a unique health insurance plan designed especially for public employees in New York State. Empire Plan benefits include inpatient and outpatient hospital coverage, medical/surgical coverage, Centers of Excellence for transplants, infertility and cancer, home care services, equipment and supplies, mental health and substance abuse coverage and prescription drug coverage.
DAVID A. PATERSON
GOVERNOR
DEPARTMENT OF CIVIL SERVICE
ALBANY, NEW YORK 12239
www.cs.ny.gov
NANCY G. GROENWEGEN
COMMISSIONER
PA09-13
TO: Participating Agency Health Benefit Administrators
FROM: Robert W. DuBois, Director of the Employee Benefits Division
SUBJECT: Empire Plan Quarterly Experience Report
DATE: May 18, 2009
Enclosed are the Fourth Quarter Empire Plan Experience Reports for 2008 and the cover letter to the Chief Executive Officers. This report presents the projected 2008 Empire Plan experience and the projected 2010 premium rates.
May 18, 2009
Dear Chief Executive Officer:
Attached is The Empire Plan Fourth Quarter Experience Report for 2008. This report presents the projected 2008 Empire Plan experience, based on claims paid through December 31, 2008, and the projected 2010 premium rates.
For the 2008 Plan Year, The Empire Plan carriers project a net dividend of $451.0 million, 8.0% of premium. This report explains the basis for this projection.
The projected 2010 rates based on The Empire Plan carriers’ premium projections
and a dividend application comparable to the amount loaded in the 2009 rates are presented in Exhibit II. This yields an insurer driven “best estimate” net premium increase of 9.9% in aggregate for The Empire Plan and 9.7% in aggregate for The Excelsior Plan. The Department’s actuarial consultant, Buck Consultants, developed an independent premium projection using the same dividend application assumption. Buck’s projection is consistent with the optimistic premium rates based on carrier projections, which reflect a 5.8% increase, in aggregate, as presented in Exhibit II.
I hope this report is informative. If you have any questions, comments or suggestions, please don’t hesitate to contact me.
Sincerely,
Robert W. DuBois, CEBS
Director
Employee Benefits Division
EMPIRE PLAN EXPERIENCE REPORT
FOURTH QUARTER
OCTOBER - DECEMBER 2008
Produced for
PARTICIPATING AGENCIES IN THE
NEW YORK STATE
HEALTH INSURANCE PROGRAM
by
the Employee Benefits Division
New York State Department of Civil Service
Nancy G. Groenwegen
President, New York State Civil Service Commission
Exhibits
- Projected 2008 Empire Plan Experience
- Projected 2010 PA Premium Rates
- Empire Plan PA 5-Tier Group Rates (2001-2010)
- Empire Plan PA 2-Tier Group Rates (2001-2010)
NEW YORK STATE HEALTH INSURANCE PROGRAM
PARTICIPATING AGENCY GROUP
EMPIRE PLAN - FOURTH QUARTER REPORT
PROJECTED 2008 EMPIRE PLAN EXPERIENCE
The Empire Plan carriers project a composite dividend of $451.0 million (8.0% of premium), or $300.9 million more than the margin loaded in the 2008 rates. The 2008 annual experience projected by the insurance carriers is reported in Exhibit I.
This projection is based on twelve months of 2008 paid claim data. The following chart presents the percentage of the projected incurred claims actually paid as well as the current 2008 trend as compared to the trend assumed during the 2008 premium rate development:
| % of Paid Claims to Projected Incurred Claims |
Projected 2008 Trend | |||
| 2007 | 2008 | @ Final Renewal | @ 2nd Quarter | |
|---|---|---|---|---|
| Blue Cross Hospital | 99.3% | 86.9% | 12.0% | 8.9% |
| UHC Medical | 99.8% | 90.1% | 10.5% | 5.7% |
| GHI MHSA | 99.7% | 82.3% | 6.0% | 14.0% |
| Blue Cross Rx | 99.9% | 98.4% | 9.7% | 4.1% |
The 2008 projected dividend for each carrier as compared to the margin level used in the 2008 premium development is as follows:
| Margin | 2008 Projected Dividend/(Loss) | Increase/(Decrease) | |
|---|---|---|---|
| Blue Cross Hospital | $38,176,000 | $99,879,000 | $61,703,000 |
| UHC Medical | $54,975,000 | $234,025,000 | $179,050,000 |
| GHI MHSA | $1,461,000 | ($7,803,000) | ($9,264,000) |
| UHC Rx | $55,516,000 | $124,901,000 | $69,385,000 |
| Total | $150,128,000 | $451,002,000 | $300,874,000 |
The increase in the dividend projection is primarily attributable to the decrease in the 2007 claims base for the medical and prescription drug components projected during the development of the 2008 rates and an improvement in 2008 trend for the medical, hospital and prescription drug programs. There also is a substantial increase in the projected pharma revenue for the prescription drug program. Offsetting the favorable prescription drug program experience is a significant increase in the disabled lives reserve. In addition, the cost of non-network mental health and substance abuse claims is higher than previously anticipated resulting in a moderate projected loss for that program.
2010 PROJECTED PREMIUM RATES
Exhibit II presents the 2010 Empire Plan gross and net premium rates as projected by the insurances carriers, assuming the application of $275 million in dividend to all payors. In aggregate, The Empire Plan gross premium is projected to increase 9.4%, while the net premium is projected to increase 9.9%. In aggregate, The Excelsior Plan gross premium is projected to increase 9.3%, while the net premium is projected to increase 9.7%. Exhibit II also includes a range of projected gross and net premium rates projected by the carriers (5.8% - 14.1%).
Exhibit III presents The Empire Plan individual and family 5-tier billing rate history since 2001. Exhibit IV presents, for illustrative purposes only, the 2-tier rate history from 2001 to 2010.
As noted above, the 2010 premium projections in Exhibit II are based on The Empire Plan insurance carriers’ 2008 fourth quarter reports. These projections do not take into account any 2009 paid claim activity. Historically, premium projections made early in the year have been conservative. The actual premium rates negotiated with the carriers in October for the following plan year have, in aggregate, been below the optimistic projections made in the 4th quarter report.
Additionally, the Department receives quarterly premium rate projections from our actuarial consultant, Buck Consultants (Buck). Buck projects an aggregate 2010 premium increase of 5.6% with the application of $275 million in dividend. This level of projected increase is consistent with the carriers’ optimistic projections at this time. Each agency should assess its budgetary environment in using the projected information contained in this report.
The current assumed dividend application of $275 million is reflective of a strategy to promote rate stability over a number of years. However, the actual amount of dividend to be applied as a credit in the 2010 premium rates will be determined in October 2009 based on a number of factors including, but not limited to, the following:
- The final results of premium negotiations with the carriers;
- The impact on the stability of premium over time (2010-2014); and
- The state of the economy, as well as the State and Local Government fiscal climate.
We will work together with the Division of the Budget to ensure that NYSHIP rates for local governments are kept as low as is fiscally prudent.
Exhibit I
2008 PROJECTED EMPIRE PLAN EXPERIENCE
In (000's)
| BLUE CROSS HOSPITAL | United Healthcare MEDICAL Core | United Healthcare MEDICAL NY Enhancement | United Healthcare MEDICAL PA Enhancement | United Healthcare MEDICAL Combined | GHI MHSA Core | GHI MHSA NY Enhancement | GHI MHSA PA Enhancement | GHI MHSA Combined | UHC DRUG | TOTAL | |
|---|---|---|---|---|---|---|---|---|---|---|---|
| (A) Premium (1) | 1,766,786 | 1,710,354 | 253,094 | 241,998 | 2,205,446 | 105,851 | 1,617 | 983 | 108,451 | 1,538,222 | 5,618,905 |
| (B) Incurred Claims (2) | 1,544,009 | 1,401,135 | 198,538 | 191,980 | 1,791,653 | 88,732 | 4,849 | 4,095 | 97,676 | 1,340,394 | 4,773,732 |
| (C) Administrative Expense (3) | 122,898 | 147,040 | 16,640 | 16,088 | 179,768 | 17,964 | 362 | 252 | 18,578 | 72,927 | 394,171 |
| (D) Gain/(Loss) (A-B-C) | 99,879 | 162,179 | 37,916 | 33,930 | 234,025 | (845) | (3,594) | (3,364) | (7,803) | 124,901 | 451,002 |
(1) Earned Premium - Premium which pays for coverage for the period reported (accrual basis).
(2) Incurred Claims - Represents the cost of covered services provided during the period reported by the insurance company (accrual basis).
(3) Administrative Expenses - All charges by the insurance carrier other than for the payment of claims. Includes carrier’s cost to administer the program, interest charges, and other retention.
Source: Carrier 2008 4th Quarter Experience Reports
Exhibit II
Participating Agency Premium Rates
Comparison of 2009 and Projected 2010 Rates
EMPIRE PLAN CORE PLUS MEDICAL & PSYCHIATRIC ENHANCEMENTS
Plan Prime: Individual
| Gross Rates (1) 2009 | Gross Rates (1) 2010 (3) | Gross Rates (1) % Change | Net Rates (2) 2009 | Net Rates (2) 2010 (3) | Net Rates (2) % Change | |
|---|---|---|---|---|---|---|
| Optimistic | 630.73 | 662.76 | 5.1% | 598.58 | 629.87 | 5.2% |
| Best estimate | 630.73 | 686.57 | 8.9% | 598.58 | 653.68 | 9.2% |
| Pessimistic | 630.73 | 710.56 | 12.7% | 598.58 | 677.67 | 13.2% |
Plan Prime: Family
| Gross Rates (1) 2008 | Gross Rates (1) 2009 (3) | Gross Rates (1) % Change | Net Rates (2) 2008 | Net Rates (2) 2009 (3) | Net Rates (2) % Change | |
|---|---|---|---|---|---|---|
| Optimistic | 1,350.26 | 1,419.86 | 5.2% | 1,282.17 | 1,350.77 | 5.4% |
| Best estimate | 1,350.26 | 1,469.91 | 8.9% | 1,282.17 | 1,400.82 | 9.3% |
| Pessimistic | 1,350.26 | 1,520.35 | 12.6% | 1,282.17 | 1,451.26 | 13.2% |
MedPrime: Individual
| Gross Rates (1) 2008 | Gross Rates (1) 2009 (3) | Gross Rates (1) % Change | Net Rates (2) 2008 | Net Rates (2) 2009 (3) | Net Rates (2) % Change | |
|---|---|---|---|---|---|---|
| Optimistic | 384.38 | 405.38 | 5.5% | 359.22 | 382.66 | 6.5% |
| Best estimate | 384.38 | 423.80 | 10.3% | 359.22 | 401.08 | 11.7% |
| Pessimistic | 384.38 | 442.25 | 15.1% | 359.22 | 419.53 | 16.8% |
MedPrime: Family - 1
| Gross Rates (1) 2008 | Gross Rates (1) 2009 (3) | Gross Rates (1) % Change | Net Rates (2) 2008 | Net Rates (2) 2009 (3) | Net Rates (2) % Change | |
|---|---|---|---|---|---|---|
| Optimistic | 1,103.90 | 1,162.52 | 5.3% | 1,042.81 | 1,103.58 | 5.8% |
| Best estimate | 1,103.90 | 1,207.17 | 9.4% | 1,042.81 | 1,148.23 | 10.1% |
| Pessimistic | 1,103.90 | 1,252.06 | 13.4% | 1,042.81 | 1,193.12 | 14.4% |
MedPrime: Family - 2
| Gross Rates (1) 2008 | Gross Rates (1) 2009 (3) | Gross Rates (1) % Change | Net Rates (2) 2008 | Net Rates (2) 2009 (3) | Net Rates (2) % Change | |
|---|---|---|---|---|---|---|
| Optimistic | 857.54 | 905.16 | 5.6% | 803.45 | 856.36 | 6.6% |
| Best estimate | 857.54 | 944.41 | 10.1% | 803.45 | 895.61 | 11.5% |
| Pessimistic | 857.54 | 983.79 | 14.7% | 803.45 | 934.99 | 16.4% |
(1) Represents premiums charged by the carriers.
(2) Represents cost to a participating agency.
(3) Projected Rates
EXCELSIOR PLAN
Plan Prime: Individual
| Gross Rates (1) 2009 | Gross Rates (1) 2010 (3) | Gross Rates (1) % Change | Net Rates (2) 2009 | Net Rates (2) 2010 (3) | Net Rates (2) % Change | |
|---|---|---|---|---|---|---|
| Optimistic | 557.49 | 581.74 | 4.3% | 529.17 | 552.47 | 4.4% |
| Best estimate | 557.49 | 606.10 | 8.7% | 529.17 | 576.83 | 9.0% |
| Pessimistic | 557.49 | 626.50 | 12.4% | 529.17 | 597.23 | 12.9% |
Plan Prime: Family
| Gross Rates (1) 2008 | Gross Rates (1) 2009 (3) | Gross Rates (1) % Change | Net Rates (2) 2008 | Net Rates (2) 2009 (3) | Net Rates (2) % Change | |
|---|---|---|---|---|---|---|
| Optimistic | 1,197.21 | 1,250.47 | 4.4% | 1,137.16 | 1,188.95 | 4.6% |
| Best estimate | 1,197.21 | 1,301.76 | 8.7% | 1,137.16 | 1,240.24 | 9.1% |
| Pessimistic | 1,197.21 | 1,344.79 | 12.3% | 1,137.16 | 1,283.27 | 12.8% |
MedPrime: Individual
| Gross Rates (1) 2008 | Gross Rates (1) 2009 (3) | Gross Rates (1) % Change | Net Rates (2) 2008 | Net Rates (2) 2009 (3) | Net Rates (2) % Change | |
|---|---|---|---|---|---|---|
| Optimistic | 320.35 | 329.29 | 2.8% | 296.43 | 308.15 | 4.0% |
| Best estimate | 320.35 | 352.55 | 10.1% | 296.43 | 331.41 | 11.8% |
| Pessimistic | 320.35 | 367.53 | 14.7% | 296.43 | 346.39 | 16.9% |
MedPrime: Family - 1
| Gross Rates (1) 2008 | Gross Rates (1) 2009 (3) | Gross Rates (1) % Change | Net Rates (2) 2008 | Net Rates (2) 2009 (3) | Net Rates (2) % Change | |
|---|---|---|---|---|---|---|
| Optimistic | 960.08 | 998.01 | 4.0% | 904.43 | 944.61 | 4.4% |
| Best estimate | 960.08 | 1,048.20 | 9.2% | 904.43 | 994.80 | 10.0% |
| Pessimistic | 960.08 | 1,085.82 | 13.1% | 904.43 | 1,032.42 | 14.2% |
MedPrime: Family - 2
| Gross Rates (1) 2008 | Gross Rates (1) 2009 (3) | Gross Rates (1) % Change | Net Rates (2) 2008 | Net Rates (2) 2009 (3) | Net Rates (2) % Change | |
|---|---|---|---|---|---|---|
| Optimistic | 722.95 | 745.55 | 3.1% | 671.71 | 700.28 | 4.3% |
| Best estimate | 722.95 | 794.64 | 9.9% | 671.71 | 749.37 | 11.6% |
| Pessimistic | 722.95 | 826.96 | 14.4% | 671.71 | 781.59 | 16.4% |
(1) Represents premiums charged by the carriers.
(2) Represents cost to a participating agency.
(3) Projected Rates
Exhibit III
EMPIRE PLAN
PA 5 TIER GROUP RATES
2001-2010 Monthly Rates
Core Plus Medical & Psychiatric Enhancements
Individual Planprime
| Year | Gross Rate (1) | % Change | Net Rate (2) | % Change |
|---|---|---|---|---|
| 2001 | 325.23 | 10.3% | 314.26 | 9.7% |
| 2002 | 353.81 | 8.8% | 344.66 | 9.7% |
| 2003 | 400.00 | 13.1% | 384.89 | 11.7% |
| 2004 | 448.00 | 12.0% | 438.15 | 13.8% |
| 2005 | 490.41 | 9.5% | 478.49 | 9.2% |
| 2006 | 547.86 | 11.7% | 529.76 | 10.7% |
| 2007 | 600.69 | 9.6% | 564.84 | 6.6% |
| 2008 | 633.79 | 5.5% | 592.38 | 4.9% |
| 2009 | 630.73 | -0.5% | 598.58 | 1.0% |
| 2010 projected | 686.57 | 8.9% | 653.68 | 9.2% |
Average Percent Increase
| Gross Rate % Change | Net Rate % Change | |
|---|---|---|
| From Inception of 5 Tier Structure (1996) | 8.1% | 8.5% |
| Most Recent 10 Years | 8.9% | 8.7% |
| Most Recent 5 Years | 7.0% | 6.5% |
Family Planprime
| Year | Gross Rate (1) | % Change | Net Rate (2) | % Change |
|---|---|---|---|---|
| 2001 | 673.67 | 10.9% | 651.09 | 10.3% |
| 2002 | 742.98 | 10.3% | 723.97 | 11.2% |
| 2003 | 842.38 | 10.4% | 811.41 | 12.1% |
| 2004 | 945.29 | 12.2% | 924.74 | 14.0% |
| 2005 | 1,038.64 | 9.9% | 1,013.68 | 9.6% |
| 2006 | 1,164.16 | 12.1% | 1,126.19 | 11.1% |
| 2007 | 1,273.96 | 9.4% | 1,198.07 | 6.4% |
| 2008 | 1,346.27 | 5.7% | 1,258.78 | 5.1% |
| 2009 | 1,350.26 | 0.3% | 1,282.17 | 1.9% |
| 2010 projected | 1,469.91 | 8.9% | 1,400.82 | 9.3% |
Average Percent Increase
| Gross Rate % Change | Net Rate % Change | |
|---|---|---|
| From Inception of 5 Tier Structure (1996) | 7.7% | 8.1% |
| Most Recent 10 Years | 9.3% | 9.1% |
| Most Recent 5 Years | 7.3% | 6.7% |
Individual Medprime
| Year | Gross Rate (1) | % Change | Net Rate (2) | % Change |
|---|---|---|---|---|
| 2001 | 245.64 | 12.7% | 239.94 | 12.0% |
| 2002 | 259.96 | 5.8% | 253.82 | 5.8% |
| 2003 | 307.02 | 18.1% | 297.50 | 17.2% |
| 2004 | 341.87 | 11.4% | 334.22 | 12.3% |
| 2005 | 340.50 | -0.4% | 331.93 | -0.7% |
| 2006 | 359.35 | 5.5% | 338.88 | 2.1% |
| 2007 | 363.02 | 1.0% | 333.18 | -1.7% |
| 2008 | 397.23 | 9.4% | 360.41 | 8.2% |
| 2009 | 384.38 | -3.2% | 359.22 | -0.3% |
| 2010 projected | 423.80 | 10.3% | 401.08 | 11.7% |
Average Percent Increase
| Gross Rate % Change | Net Rate % Change | |
|---|---|---|
| From Inception of 5 Tier Structure (1996) | 5.3% | 5.9% |
| Most Recent 10 Years | 7.1% | 6.7% |
| Most Recent 5 Years | 4.6% | 4.0% |
Family - 1 Medprime
| Year | Gross Rate (1) | % Change | Net Rate (2) | % Change |
|---|---|---|---|---|
| 2001 | 595.25 | 12.1% | 577.95 | 11.5% |
| 2002 | 649.14 | 9.1% | 633.13 | 9.5% |
| 2003 | 749.40 | 15.4% | 724.05 | 14.4% |
| 2004 | 839.18 | 12.0% | 820.82 | 13.4% |
| 2005 | 888.71 | 5.9% | 867.09 | 5.6% |
| 2006 | 975.66 | 9.8% | 935.32 | 7.9% |
| 2007 | 1,036.30 | 6.2% | 966.44 | 3.3% |
| 2008 | 1,109.74 | 7.1% | 1,026.86 | 6.3% |
| 2009 | 1,103.90 | -0.5% | 1,042.81 | 1.6% |
| 2010 projected | 1,207.17 | 9.4% | 1,148.23 | 10.1% |
Average Percent Increase
| Gross Rate % Change | Net Rate % Change | |
|---|---|---|
| From Inception of 5 Tier Structure (1996) | 6.4% | 6.8% |
| Most Recent 10 Years | 8.6% | 8.3% |
| Most Recent 5 Years | 6.4% | 5.8% |
Family - 2 or More Medprime
| Year | Gross Rate (1) | % Change | Net Rate (2) | % Change |
|---|---|---|---|---|
| 2001 | 514.40 | 13.5% | 502.37 | 12.8% |
| 2002 | 555.29 | 7.9% | 542.29 | 7.9% |
| 2003 | 656.42 | 18.2% | 636.67 | 17.4% |
| 2004 | 733.05 | 11.7% | 716.88 | 12.6% |
| 2005 | 738.79 | 0.8% | 720.53 | 0.5% |
| 2006 | 787.16 | 6.5% | 744.45 | 3.3% |
| 2007 | 798.65 | 1.5% | 734.81 | -1.3% |
| 2008 | 873.21 | 9.3% | 794.94 | 8.2% |
| 2009 | 857.54 | -1.8% | 803.45 | 1.1% |
| 2010 projected | 944.41 | 10.1% | 895.61 | 11.5% |
Average Percent Increase
| Gross Rate % Change | Net Rate % Change | |
|---|---|---|
| From Inception of 5 Tier Structure (1996) | 5.2% | 5.8% |
| Most Recent 10 Years | 7.8% | 7.4% |
| Most Recent 5 Years | 5.1% | 4.5% |
(1) Represents premiums paid to the carriers.
(2) Represents cost to a participating agency.
(3) Inception of Medprime Rate Structure.
Exhibit IV
EMPIRE PLAN
PA 2 TIER GROUP RATES
2001-2010 Monthly Rates
(For Illustrative Purposes Only)
Core Plus Medical & Psychiatric Enhancement
Individual
| Year | Gross Rate (1) | % Change | Net Rate (2) | % Change |
|---|---|---|---|---|
| 2001 | 289.41 | 11.0% | 280.25 | 10.3% |
| 2002 | 313.58 | 8.4% | 305.67 | 9.1% |
| 2003 | 357.44 | 14.0% | 345.36 | 13.0% |
| 2004 | 402.70 | 12.7% | 394.31 | 14.2% |
| 2005 | 433.70 | 7.7% | 423.31 | 7.4% |
| 2006 | 477.33 | 10.1% | 459.25 | 8.5% |
| 2007 | 511.23 | 7.1% | 477.96 | 4.1% |
| 2008 | 536.84 | 5.0% | 498.88 | 4.4% |
| 2009 | 527.09 | -1.8% | 497.91 | -0.2% |
| 2010 projected | 577.00 | 9.5% | 547.99 | 10.1% |
Average Percent Increase
| Gross Rate % Change | Net Rate % Change | |
|---|---|---|
| From Inception (1986) | 7.7% | 7.7% |
| Most Recent 10 Years | 8.4% | 8.1% |
| Most Recent 5 Years | 6.0% | 5.4% |
Family
| Year | Gross Rate (1) | % Change | Net Rate (2) | % Change | |||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| 2001 | 640.64 | 10.8% | 619.28 | 10.0% | |||||||
| 2002 | 703.61 | 9.8% | 685.83 | 10.7% | |||||||
| 2003 | 805.64 | 14.5% | 778.82 | 13.6% | |||||||
| 2004 | 899.98 | 11.7% | 881.48 | 13.2% | |||||||
| 2005 | 968.40 | 7.6% | 945.11 | 7.2% | |||||||
| 2006 | 1,073.28 | 10.8% | 1,034.40 | 9.4% | |||||||
| 2007 | 1,158.16 | 7.9% | 1,084.90 | 4.9% | |||||||
| 2008 | 1,233.38 | 6.5% | 1,150.41 | 1,536,436 | 5,611,992 | ||||||
| (B) Incurred Claims (2) | 1,557,807 | 1,403,790 | 199,271 | 189,741 | 1,792,802 | 86,509 | 3,816 | 3,315 | 93,640 | 1,343,304 | 4,787,553 |
| (C) Administrative Expense (3) | 122,757 | 150,359 | 16,318 | 15,584 | 182,261 | 17,777 | 335 | 230 | 18,342 | 72,114 | 395,474 |
| (D) Gain/(Loss) (A-B-C) | 83,769 | 154,446 | 37,518 | 35,990 | 227,954 | 1,325 | (2,537) | (2,564) | (3,776) | 121,018 | 428,965 |
(1) Earned Premium - Premium which pays for coverage for the period reported (accrual basis).
(2) Incurred Claims - Represents the cost of covered services provided during the period reported by the insurance company (accrual basis).
(3) Administrative Expenses - All charges by the insurance carrier other than for the payment of claims. Includes carrier’s cost to administer the program, interest charges, and other retention.
Source: Carrier 2008 3rd Quarter Experience Report
Exhibit II
Empire Plan
Participating Agency Premium Rates
Comparison of 2008 and 2009 Rates
Mediprime Rate Structure
EMPIRE PLAN
Plan Prime
| Gross Rates (1) 2008 | Gross Rates (1) 2009 | Gross Rates (1) % Change | Net Rates (2) 2008 | Net Rates (2) 2009 | Net Rates (2) % Change | |
|---|---|---|---|---|---|---|
| Individual | 633.79 | 630.73 | -0.5% | 592.38 | 598.58 | 1.0% |
| Family | 1,346.27 | 1,350.26 | 0.3% | 1,258.78 | 1,282.17 | 1.9% |
Medprime
| Gross Rates (1) 2008 | Gross Rates (1) 2009 (3) | Gross Rates (1) % Change | Net Rates (2) 2008 | Net Rates (2) 2009 (3) | Net Rates (2) % Change | |
|---|---|---|---|---|---|---|
| Individual | 397.23 | 384.38 | -3.2% | 360.41 | 359.22 | -0.3% |
| Family - 1 medicare | 1,109.74 | 1,103.90 | -0.5% | 1,026.86 | 1,042.81 | 1.6% |
| Family - 2 medicares | 873.21 | 857.54 | -1.8% | 794.94 | 803.45 | 1.1% |
(1) Represents premiums charged by the carriers.
(2) Represents cost to a participating agency.
EXCELSIOR PLAN
Plan Prime
| Gross Rates (1) 2008 | Gross Rates (1) 2009 | Gross Rates (1) % Change | Net Rates (2) 2008 | Net Rates (2) 2009 | Net Rates (2) % Change | |
|---|---|---|---|---|---|---|
| Individual | 551.81 | 557.49 | 1.0% | 513.43 | 529.17 | 3.1% |
| Family | 1,173.06 | 1,197.21 | 2.1% | 1,091.89 | 1,137.16 | 4.1% |
Medprime
| Gross Rates (1) 2008 | Gross Rates (1) 2009 (3) | Gross Rates (1) % Change | Net Rates (2) 2008 | Net Rates (2) 2009 (3) | Net Rates (2) % Change | |
|---|---|---|---|---|---|---|
| Individual | 322.07 | 320.35 | -0.5% | 286.19 | 296.43 | 3.6% |
| Family - 1 medicare | 943.33 | 960.08 | 1.8% | 864.68 | 904.43 | 4.6% |
| Family - 2 medicares | 713.58 | 722.95 | 1.3% | 637.43 | 671.71 | 5.4% |
(1) Represents premiums charged by the carriers.
(2) Represents cost to a participating agency.
Exhibit III
EMPIRE PLAN
PA 5 TIER GROUP RATES
2000-2009 Monthly Rates
Core Plus Medical & Psychiatric Enhancements
Individual Planprime
| Year | Gross Rate (1) | % Change | Net Rate (2) | % Change |
|---|---|---|---|---|
| 2000 | 294.94 | 5.5% | 286.53 | 9.7% |
| 2001 | 325.23 | 10.3% | 314.26 | 9.7% |
| 2002 | 353.81 | 8.8% | 344.66 | 9.7% |
| 2003 | 400.00 | 13.1% | 384.89 | 11.7% |
| 2004 | 448.00 | 12.0% | 438.15 | 13.8% |
| 2005 | 490.41 | 9.5% | 478.49 | 9.2% |
| 2006 | 547.86 | 11.7% | 529.76 | 10.7% |
| 2007 | 600.69 | 9.6% | 564.84 | 6.6% |
| 2008 | 633.79 | 5.5% | 592.38 | 4.9% |
| 2009 | 630.73 | -0.5% | 598.58 | 1.0% |
Average Percent Increase
| Gross Rate % Change | Net Rate % Change | |
|---|---|---|
| From Inception of 5 Tier Structure (1996) | 8.1% | 8.5% |
| Most Recent 10 Years | 8.5% | 8.7% |
| Most Recent 5 Years | 7.2% | 6.5% |
Family Planprime
| Year | Gross Rate (1) | % Change | Net Rate (2) | % Change |
|---|---|---|---|---|
| 2000 | 607.33 | 5.9% | 590.16 | 11.0% |
| 2001 | 673.67 | 10.9% | 651.09 | 10.3% |
| 2002 | 742.98 | 10.3% | 723.97 | 11.2% |
| 2003 | 842.38 | 13.4% | 811.41 | 12.1% |
| 2004 | 945.29 | 12.2% | 924.74 | 14.0% |
| 2005 | 1,038.64 | 9.9% | 1,013.68 | 9.6% |
| 2006 | 1,164.16 | 12.1% | 1,126.19 | 11.1% |
| 2007 | 1,273.96 | 9.4% | 1,198.07 | 6.4% |
| 2008 | 1,346.27 | 5.7% | 1,258.78 | 5.1% |
| 2009 | 1,350.26 | 0.3% | 1,282.17 | 1.9% |
Average Percent Increase
| Gross Rate % Change | Net Rate % Change | |
|---|---|---|
| From Inception of 5 Tier Structure (1996) | 7.6% | 8.0% |
| Most Recent 10 Years | 9.0% | 9.3% |
| Most Recent 5 Years | 7.5% | 6.8% |
Individual Medprime
| Year | Gross Rate (1) | % Change | Net Rate (2) | % Change |
|---|---|---|---|---|
| 2000 | 217.94 | 16.9% | 214.25 | 22.0% |
| 2001 | 245.64 | 12.7% | 239.94 | 12.0% |
| 2002 | 259.96 | 5.8% | 253.82 | 5.8% |
| 2003 | 307.02 | 18.1% | 297.50 | 17.2% |
| 2004 | 341.87 | 11.4% | 334.22 | 12.3% |
| 2005 | 340.50 | -0.4% | 331.93 | -0.7% |
| 2006 | 359.35 | 5.5% | 338.88 | 2.1% |
| 2007 | 363.02 | 1.0% | 333.18 | -1.7% |
| 2008 | 397.23 | 9.4% | 360.41 | 8.2% |
| 2009 | 384.38 | -3.2% | 359.22 | -0.3% |
Average Percent Increase
| Gross Rate % Change | Net Rate % Change | |
|---|---|---|
| From Inception of 5 Tier Structure (1996) | 4.9% | 5.4% |
| Most Recent 10 Years | 7.7% | 7.7% |
| Most Recent 5 Years | 2.5% | 1.5% |
Family - 1 Medprime
| Year | Gross Rate (1) | % Change | Net Rate (2) | % Change |
|---|---|---|---|---|
| 2000 | 530.97 | 10.4% | 518.52 | 16.0% |
| 2001 | 595.25 | 12.1% | 577.95 | 11.5% |
| 2002 | 649.14 | 9.1% | 633.13 | 9.5% |
| 2003 | 749.40 | 15.4% | 724.05 | 14.4% |
| 2004 | 839.18 | 12.0% | 820.82 | 13.4% |
| 2005 | 888.71 | 5.9% | 867.09 | 5.6% |
| 2006 | 975.66 | 9.8% | 935.32 | 7.9% |
| 2007 | 1,036.30 | 6.2% | 966.44 | 3.3% |
| 2008 | 1,109.74 | 7.1% | 1,026.86 | 6.3% |
| 2009 | 1,103.90 | -0.5% | 1,042.81 | 1.6% |
Average Percent Increase
| Gross Rate % Change | Net Rate % Change | |
|---|---|---|
| From Inception of 5 Tier Structure (1996) | 6.2% | 6.6% |
| Most Recent 10 Years | 8.7% | 8.9% |
| Most Recent 5 Years | 5.7% | 4.9% |
Family - 2 or More Medprime
| Year | Gross Rate (1) | % Change | Net Rate (2) | % Change |
|---|---|---|---|---|
| 2000 | 453.22 | 17.1% | 445.51 | 23.5% |
| 2001 | 514.40 | 13.5% | 502.37 | 12.8% |
| 2002 | 555.29 | 7.9% | 542.29 | 7.9% |
| 2003 | 656.42 | 18.2% | 636.67 | 17.4% |
| 2004 | 733.05 | 11.7% | 716.88 | 12.6% |
| 2005 | 738.79 | 0.8% | 720.53 | 0.5% |
| 2006 | 787.16 | 6.5% | 744.45 | 3.3% |
| 2007 | 798.65 | 1.5% | 734.81 | -1.3% |
| 2008 | 873.21 | 9.3% | 794.94 | 8.2% |
| 2009 | 857.54 | -1.8% | 803.45 | 1.1% |
Average Percent Increase
| Gross Rate % Change | Net Rate % Change | |
|---|---|---|
| From Inception of 5 Tier Structure (1996) | 4.8% | 5.4% |
| Most Recent 10 Years | 8.5% | 8.6% |
| Most Recent 5 Years | 3.3% | 2.4% |
(1) Represents premiums paid to the carriers.
(2) Represents cost to a participating agency.
(3) Inception of Medprime Rate Structure.
Exhibit IV
EMPIRE PLAN
PA 2 TIER GROUP RATES
2000-2009 Monthly Rates
(For Illustrative Purposes Only)
Core Plus Medical & Psychiatric Enhancement
Individual
| Year | Gross Rate (1) | % Change | Net Rate (2) | % Change |
|---|---|---|---|---|
| 2000 | 260.67 | 9.0% | 253.98 | 14.4% |
| 2001 | 289.41 | 11.0% | 280.25 | 10.3% |
| 2002 | 313.58 | 8.4% | 305.67 | 9.1% |
| 2003 | 357.44 | 14.0% | 345.36 | 13.0% |
| 2004 | 402.70 | 12.7% | 394.31 | 14.2% |
| 2005 | 433.70 | 7.7% | 423.31 | 7.4% |
| 2006 | 477.33 | 10.1% | 459.25 | 8.5% |
| 2007 | 511.23 | 7.1% | 477.96 | 4.1% |
| 2008 | 536.84 | 5.0% | 498.88 | 4.4% |
| 2009 | 527.09 | -1.8% | 497.91 | -0.2% |
Average Percent Increase
| Gross Rate % Change | Net Rate % Change | |
|---|---|---|
| From Inception (1986) | 7.7% | 7.6% |
| Most Recent 10 Years | 8.3% | 8.5% |
| Most Recent 5 Years | 5.6% | 4.8% |
Family
| Year | Gross Rate (1) | % Change | Net Rate (2) | % Change |
|---|---|---|---|---|
| 2000 | 578.26 | 7.3% | 563.03 | 12.7% |
| 2001 | 640.64 | 10.8% | 619.28 | 10.0% |
| 2002 | 703.61 | 9.8% | 685.83 | 10.7% |
| 2003 | 805.64 | 14.5% | 778.82 | 13.6% |
| 2004 | 899.98 | 11.7% | 881.48 | 13.2% |
| 2005 | 968.40 | 7.6% | 945.11 | 7.2% |
| 2006 | 1,073.28 | 10.8% | 1,034.40 | 9.4% |
| 2007 | 1,158.16 | 7.9% | 1,084.90 | 4.9% |
| 2008 | 1,233.38 | 6.5% | 1,150.41 | 6.0% |
| 2009 | 1,230.02 | -0.3% | 1,165.24 | 1.3% |
Average Percent Increase
| Gross Rate % Change | Net Rate % Change | |
|---|---|---|
| From Inception (1986) | 8.2% | 8.1% |
| Most Recent 10 Years | 8.7% | 8.9% |
| Most Recent 5 Years | 6.5% | 5.8% |
(1) Represents premiums charged by the carriers.
(2) Represents cost to a participating agency.
Fourth Quarter Report - 2008
The American Recovery and Reinvestment Act of 2009 (ARRA)
The ARRA of 2009, passed by Congress in February, includes provisions that provide COBRA assistance to individuals involuntarily terminated from employment between September 1, 2008 and December 31, 2009. Assistance eligible individuals will pay 35% of the COBRA premium, with the remaining 65% reimbursed to the employer through Federal payroll taxes. The Employee Benefits Division issued PA Memo 09-10 (PAEX-09-06 for agencies that offer The Excelsior Plan), dated April 2, 2009, which provides information on the COBRA Subsidy Provisions. Participating Agencies that are subject to the COBRA laws are responsible for complying with these new provisions. NYSHIP will assist agencies with fewer than 20 employees since the federal subsidy must be claimed by the insurers. PA Memo 09-11 (PAEX 09-07), dated April 16, 2009, includes the procedures for administration of the ARRA COBRA Premium Subsidy for these smaller agencies.
The Employee Benefits Division also issued PA Memo 09-12 (PAEX 09-08), dated April 16, 2009, with additional information specifically related to eligibility of vestees and local officials.
Please be sure to review these documents carefully, as they provide important information about this new legislation and your responsibilities for administering it.
Dependent Eligibility Verification Project
The NYSHIP dependent eligibility audit is underway. The Employee Benefits Division issued PA Memo 09-06, dated March 5, 2009, which provides details about this project, including the timeframes and the materials that will be sent to enrollees, as well as a copy of the letter that was sent to all enrollees. Budco, a company with extensive experience in this field, is administering the Dependent Eligibility Verification Project. Budco is providing call center services for enrollees, as well as reviewing proofs and handling appeals.
The project includes a 60-day amnesty period during which enrollees can remove ineligible dependents without penalty. In early April, enrollees with family coverage were sent an amnesty packet which included a list of covered dependents and instructions for removing any ineligible dependent during the amnesty period which ends on June 12. To date, over 10,000 dependents have been voluntarily deleted. In September participating agency enrollees will receive the audit packet. At that time enrollees will be required to submit documentation of each dependent’s eligibility for coverage. Failure to provide acceptable documentation by the due date will result in the removal of the dependent from the enrollment file.
Increase in Health Insurance Assessments
The Employee Benefits Division has received numerous inquiries about the State’s recent increases in health insurance assessments and how NYSHIP rates will be affected. Please note that there will NOT be any mid-year NYSHIP rate increases as a result of this.
NYBEAS Upgrade
An upgrade of NYBEAS is planned for early June. Watch for information about the changes. HBAs will have an opportunity to familiarize themselves with the system changes before the implementation date.
Medicare Part D Employer Subsidy Update
To date, NYSHIP applied for and received estimated Employer Subsidies through the third quarter of 2008 (through September); the latest subsidy was applied to the bill issued in January for February 2009 coverage. The Department will continue to credit PA bills as the employer subsidies are received.
Prompt Payment of NYSHIP Premium
As indicated in previous reports, the Employee Benefits Division has been aggressively monitoring agencies that fail to submit premium payments in a timely manner. This procedure includes suspension of claims for enrollees of any agency that falls three months behind in their premiums. To avoid disruption of your employees’ benefits, please be sure to submit your premium payments by the due date, as we must submit premium to the Empire Plan insurers on time. You may wish to consider submitting your payments electronically to promote timely payments. Attached are guidelines to initiate electronic transfer of funds.
GASB 45 Census Reports
As indicated in previous reports, NYSHIP will provide agency census reports upon request for use in complying with the provisions of GASB 45. Since the data included in these reports will be current at the time they are provided, it is important that your agency NYBEAS file is up-to-date, including correctly identifying and coding retirees before requesting census reports. To request a copy of your agency’s census information, please send an e-mail to: Kevin.Hill@cs.state.ny.us and include your name, agency name & code number, mailing address, phone number and e-mail address. For additional information about GASB 45, please refer to PA Memos 06-11 and 06-18.