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
PA09-15
TO: Participating Agency Health Benefit Administrators
FROM: Robert W. DuBois, Director of the Employee Benefits Division
SUBJECT: Empire Plan Quarterly Experience Report
DATE: June 23, 2009
Enclosed are the First Quarter 2009 Empire Plan Experience Report for Participating Agencies and the cover letter to the Chief Executive Officers. This report presents the actual 2008 Empire Plan experience, the projected 2009 Empire Plan experience and the projected 2010 premium rates.
June 23, 2009
Dear Chief Executive Officer:
Attached is the Empire Plan First Quarter Experience Report for 2009. This report presents the actual 2008 Empire Plan experience, the projected 2009 Empire Plan experience, based on claims paid through March 31, 2009, and the projected 2010 premium rates.
For the 2008 Plan Year, the Empire Plan carriers declared a net dividend of $460.5 million, 8.2% of premium. This dividend will be used to offset future premium increases. For the 2009 Plan Year, the Empire Plan carriers project a net dividend of $26.0 million, 0.5% of premium. This report presents the basis for these projections and future reports will include revised projections based on additional claims experience.
The projected 2010 premium 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 III. This yields insurer driven “best estimate” net premium increases of 8.8% in aggregate for The Empire Plan and 8.6% 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 projects 2010 premium increases of 6.6% and 6.2% for The Empire Plan and The Excelsior Plan, respectively.
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
FIRST QUARTER
(January - March 2009)
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
- 2008 Empire Plan Experience
- Projected 2009 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 EXPERIENCE REPORT
FIRST QUARTER 2009 REPORT
ACTUAL 2008 EMPIRE PLAN EXPERIENCE
The Empire Plan carriers project a composite dividend of $460.5 million (8.2% of premium), or $310.4 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 2008 settlement is based on thirteen months of 2008 paid claim data. The following chart presents the percentage of the incurred claims actually paid as well as the observed 2008 trend as compared to the trend assumed during the 2008 premium rate development:
| % of Actual Paid Claims to Projected Incurred Claims | Projected 2008 Trend | |||
| 2007 | 2008 | @ Final Renewal | @ 2nd Quarter | |
|---|---|---|---|---|
| Blue Cross Hospital | 99.5% | 94.2% | 12.0% | 8.0% |
| UHC Medical | 99.8% | 95.6% | 10.5% | 5.2% |
| GHI MHSA | 99.8% | 89.9% | 6.0% | 14.0% |
| Rx | 99.9% | 99.8% | 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 | $115,883,000 | $77,707,000 |
| UHC Medical | $54,975,000 | $223,511,000 | $179,050,000 |
| GHI MHSA | $1,461,000 | ($7,692,000) | ($9,153,000) |
| UHC Rx | $55,516,000 | $128,792,000 | $73,276,000 |
| Total | $150,128,000 | $460,494,000 | $310,366,000 |
The increase in the final dividend over the margin is primarily attributable to an $80 million decrease in the 2007 claims base for the medical, hospital and prescription drug components projected during the development of the 2008 rates and an improvement in the 2008 trend equivalent to $220 million for the medical, hospital and prescription drug programs. Also, there was a substantial increase in the projected pharma revenue for the prescription drug program. Offsetting the favorable prescription drug program experience was a significant increase in the disabled lives reserve. In addition, the cost of non-network mental health and substance abuse claims was higher than previously anticipated resulting in a moderate loss for that program.
PROJECTED 2009 EMPIRE PLAN EXPERIENCE
The Empire Plan carriers project that the 2009 premiums, which included no margin, will generate a composite dividend of $26.0 million (0.5% of premium). The 2009 annual experience projected by the insurance carriers is reported in Exhibit II.
This projection is based on only three months of 2009 paid claim data. The following chart presents the percentage of the projected incurred claims actually paid as well as the current 2009 trend as compared to the trend assumed during the 2009 premium rate development:
| % of Actual Paid Claims to Projected Incurred Claims | Projected 2008 Trend | |||
| 2007 | 2008 | @ Final Renewal | @ 2nd Quarter | |
|---|---|---|---|---|
| Blue Cross Hospital | 97.3% | 14.3% | 11.5% | 11.2% |
| UHC Medical | 98.3% | 16.1% | 7.5% | 5.8% |
| GHI MHSA | 96.5% | 10.7% | 9.2% | 8.9% |
| Rx | 99.9% | 20.6% | 9.0% | 7.2% |
The 2009 projected dividend for each carrier as compared to the margin level used in the 2009 premium development is as follows:
| Margin | 2008 Projected Dividend/(Loss) | Increase/(Decrease) | |
|---|---|---|---|
| Blue Cross Hospital | $0 | $4,421,000 | $4,421,000 |
| UHC Medical | $0 | $2,762,000 | $2,762,000 |
| GHI MHSA | $0 | ($4,825,000) | ($4,825,000) |
| UHC Rx | $0 | $23,647,000 | $23,647,000 |
| Total | $0 | $26,005,000 | $26,005,000 |
The increase in the dividend projection is primarily attributable to the modest decrease in the 2008 claims base for the hospital program projected during the development of the 2008 rates and an improvement in 2009 trend equivalent to $56 million for the medical program and prescription drug programs. In addition, an increase in the pharma revenue is projected to be offset by an increase in retention and assessments among all the carriers. The latter is primarily due to increases in projected assessments (NYS Insurance Department Assessment, Bad Debt and Charity Surcharge and Covered Lives Assessment) made through recent legislation. The projected loss for the Mental Health and Substance Abuse Program is deemed to be premature given the change in insurance carriers effective January 1, 2009 and the lack of historical data to make an accurate projection.
Historically, experience projections made by the insurance carriers in the 1st Quarter Experience Reports have been quite conservative compared to the actual experience and the first quarter experience projections made by our benefit consultant, Buck Consultants (Buck). Buck currently projects a 2009 dividend of $112 million. Based of past performance, our opinion, at this time, is that the actual 2009 dividend will more closely resemble the Buck dividend projection.
2010 PROJECTED PREMIUM RATES
Exhibit III presents the projected 2010 Empire Plan gross and net premium rates as projected by the insurance carriers, assuming the application of $275.0 million in dividend to all payors. In aggregate, The Empire Plan gross premium is projected to increase 8.3% while the net premium is projected to increase 8.8%. In aggregate, The Excelsior Plan gross premium is projected to increase 8.2% while the net premium is projected to increase 8.6%. Exhibit III also includes a range of gross and net premium rates projected by the carriers (4.6% - 13.0% net increase).
Exhibit IV presents The Empire Plan individual and family 5-tier billing rate history since 2001. Exhibit V presents, for illustrative purposes only, the 2-tier rate history from 2001 to 2010.
As noted above, the 2010 premium projections in Exhibit III are based on The Empire Plan insurance carriers’ 2009 first quarter reports reflecting only three months of 2009 paid claim activity. Historically, premium projections made at this time of 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 1st quarter report for four of the last five years.
The Department receives quarterly premium rate projections from Buck Consultants. Buck projects an aggregate 2010 premium increase of 6.6% with the application of $275 million in dividend. This level of projected increase is between the carriers’ optimistic and best estimate projections at this time. While each agency should assess its budgetary environment in using the projected information contained in this report, we believe the actual increases will more closely match the Buck projections.
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).
- The status 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 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 | 982 | 108,450 | 1,538,220 | 5,618,902 |
| (B) Incurred Claims (2) | 1,528,518 | 1,402,953 | 199,424 | 192,861 | 1,795,238 | 88,617 | 4,839 | 4,091 | 97,547 | 1,337,697 | 4,759,000 |
| (C) Administrative Expense (3) | 122,385 | 152,431 | 17,422 | 16,844 | 186,697 | 17,980 | 364 | 251 | 18,595 | 71,731 | 399,408 |
| (D) Gain/(Loss) (A-B-C) | 115,883 | 154,970 | 36,248 | 32,293 | 223,511 | (746) | (3,586) | (3,360) | (7,692) | 128,792 | 460,494 |
(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 Annual Statements
Exhibit II
2009 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) | 1,889,813 | 1,676,222 | 238,714 | 228,308 | 2,143,244 | 111,474 | 4,785 | 4,060 | 120,319 | 1,482,347 | 5,635,723 |
| (B) Incurred Claims (2) | 1,748,863 | 1,518,612 | 209,127 | 204,179 | 1,931,918 | 99,088 | 4,222 | 3,409 | 106,719 | 1,380,595 | 5,168,095 |
| (C) Administrative Expense (3) | 136,529 | 172,237 | 18,409 | 17,918 | 208,564 | 17,098 | 730 | 597 | 18,425 | 78,105 | 441,623 |
| (D) Gain/(Loss) (A-B-C) | 4,421 | (14,627) | 11,178 | 6,211 | 2,762 | (4,712) | (167) | 54 | (4,825) | 23,647 | 26,005 |
(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: Carriers 2009 1st Quarter Experience Reports
Exhibit III
Participating Agency Premium Rates
Comparison of 2009 and Projected 2010 Rates
EMPIRE PLAN CORE PLUS MEDICAL & PSYCHIATRIC ENHANCEMENTS
Plan Prime: Individual Coverage
| 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 | |
|---|---|---|---|---|---|---|
| Carrier Projections: Optimistic | 630.73 | 655.86 | 4.0% | 598.58 | 622.92 | 4.1% |
| Carrier Projections: Best estimate | 630.73 | 680.11 | 7.8% | 598.58 | 647.17 | 8.1% |
| Carrier Projections: Pessimistic | 630.73 | 704.63 | 11.7% | 598.58 | 671.69 | 12.2% |
| Buck Consultants | 630.73 | 666.49 | 5.7% | 598.58 | 633.55 | 5.8% |
Plan Prime: Family Coverage
| 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 | |
|---|---|---|---|---|---|---|
| Carrier Projections: Optimistic | 1,350.26 | 1,405.59 | 4.1% | 1,282.17 | 1,336.40 | 4.2% |
| Carrier Projections: Best estimate | 1,350.26 | 1,456.85 | 7.9% | 1,282.17 | 1,387.66 | 8.2% |
| Carrier Projections: Pessimistic | 1,350.26 | 1,508.75 | 11.7% | 1,282.17 | 1,439.56 | 12.3% |
| Buck Consultants | 1,350.26 | 1,427.08 | 5.7% | 1,282.17 | 1,357.89 | 5.9% |
MedPrime: Individual Coverage
| 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 | |
|---|---|---|---|---|---|---|
| Carrier Projections: Optimistic | 384.38 | 400.61 | 4.2% | 359.22 | 377.88 | 5.2% |
| Carrier Projections: Best estimate | 384.38 | 419.05 | 9.0% | 359.22 | 396.32 | 10.3% |
| Carrier Projections: Pessimistic | 384.38 | 437.56 | 13.8% | 359.22 | 414.83 | 15.5% |
| Buck Consultants | 384.38 | 414.04 | 7.7% | 359.22 | 391.31 | 8.9% |
MedPrime: Family Coverage - 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 | |
|---|---|---|---|---|---|---|
| Carrier Projections: Optimistic | 1,103.90 | 1,150.35 | 4.2% | 1,042.81 | 1,091.37 | 4.7% |
| Carrier Projections: Best estimate | 1,103.90 | 1,195.80 | 8.3% | 1,042.81 | 1,136.82 | 9.0% |
| Carrier Projections: Pessimistic | 1,103.90 | 1,241.68 | 12.5% | 1,042.81 | 1,182.70 | 13.4% |
| Buck Consultants | 1,103.90 | 1,174.63 | 6.4% | 1,042.81 | 1,115.65 | 7.0% |
MedPrime: Family Coverage - 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 | |
|---|---|---|---|---|---|---|
| Carrier Projections: Optimistic | 857.54 | 895.08 | 4.4% | 803.45 | 846.27 | 5.3% |
| Carrier Projections: Best estimate | 857.54 | 934.74 | 9.0% | 803.45 | 885.93 | 10.3% |
| Carrier Projections: Pessimistic | 857.54 | 974.59 | 13.6% | 803.45 | 925.78 | 15.2% |
| Buck Consultants | 857.54 | 922.17 | 7.5% | 803.45 | 873.36 | 8.7% |
(1) Represents premiums charged by the carriers.
(2) Represents cost to a participating agency.
(3) Projected Rates
EXCELSIOR PLAN
Plan Prime: Individual Coverage
| 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 | |
|---|---|---|---|---|---|---|
| Carrier Projections: Optimistic | 557.49 | 580.88 | 4.2% | 529.17 | 551.57 | 4.2% |
| Carrier Projections: Best estimate | 557.49 | 601.53 | 7.9% | 529.17 | 572.22 | 8.1% |
| Carrier Projections: Pessimistic | 557.49 | 622.44 | 11.7% | 529.17 | 593.13 | 12.1% |
| Buck Consultants | 557.49 | 587.14 | 5.3% | 529.17 | 557.83 | 5.4% |
Plan Prime: Family Coverage
| 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 | |
|---|---|---|---|---|---|---|
| Carrier Projections: Optimistic | 1,197.21 | 1,248.80 | 4.3% | 1,137.16 | 1,187.21 | 4.4% |
| Carrier Projections: Best estimate | 1,197.21 | 1,292.60 | 8.0% | 1,137.16 | 1,231.01 | 8.3% |
| Carrier Projections: Pessimistic | 1,197.21 | 1,336.95 | 11.7% | 1,137.16 | 1,275.36 | 12.2% |
| Buck Consultants | 1,197.21 | 1,261.19 | 5.3% | 1,137.16 | 1,199.60 | 5.5% |
MedPrime: Individual Coverage
| 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 | |
|---|---|---|---|---|---|---|
| Carrier Projections: Optimistic | 320.35 | 332.11 | 3.7% | 296.43 | 310.97 | 4.9% |
| Carrier Projections: Best estimate | 320.35 | 347.04 | 8.3% | 296.43 | 325.90 | 9.9% |
| Carrier Projections: Pessimistic | 320.35 | 362.02 | 13.0% | 296.43 | 340.88 | 15.0% |
| Buck Consultants | 320.35 | 344.11 | 7.4% | 296.43 | 322.97 | 9.0% |
MedPrime: Family Coverage - 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 | |
|---|---|---|---|---|---|---|
| Carrier Projections: Optimistic | 960.08 | 1,000.04 | 4.2% | 904.43 | 946.61 | 4.7% |
| Carrier Projections: Best estimate | 960.08 | 1,038.11 | 8.1% | 904.43 | 984.68 | 8.9% |
| Carrier Projections: Pessimistic | 960.08 | 1,076.55 | 12.1% | 904.43 | 1,023.12 | 13.1% |
| Buck Consultants | 960.08 | 1,018.15 | 6.0% | 904.43 | 964.72 | 6.7% |
MedPrime: Family Coverage - 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 | |
|---|---|---|---|---|---|---|
| Carrier Projections: Optimistic | 722.95 | 751.27 | 3.9% | 671.71 | 706.00 | 5.1% |
| Carrier Projections: Best estimate | 722.95 | 783.62 | 8.4% | 671.71 | 738.35 | 9.9% |
| Carrier Projections: Pessimistic | 722.95 | 816.12 | 12.9% | 671.71 | 770.85 | 14.8% |
| Buck Consultants | 722.95 | 775.12 | 7.2% | 671.71 | 729.85 | 8.7% |
(1) Represents premiums charged by the carriers.
(2) Represents cost to a participating agency.
(3) Projected Rates
Exhibit IV
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* | 680.11 | 7.8% | 647.17 | 8.1% |
Average Percent Increase
| Gross Rate % Change | Net Rate % Change | |
|---|---|---|
| From Inception of 5 Tier Structure (1996) | 8.1% | 8.4% |
| Most Recent 10 Years | 8.8% | 8.5% |
| Most Recent 5 Years | 6.8% | 6.3% |
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* | 1,456.85 | 7.9% | 1,387.66 | 8.2% |
Average Percent Increase
| Gross Rate % Change | Net Rate % Change | |
|---|---|---|
| From Inception of 5 Tier Structure (1996) | 7.6% | 8.0% |
| Most Recent 10 Years | 9.2% | 9.0% |
| Most Recent 5 Years | 7.1% | 6.5% |
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* | 419.05 | 9.0% | 396.32 | 10.3% |
Average Percent Increase
| Gross Rate % Change | Net Rate % Change | |
|---|---|---|
| From Inception of 5 Tier Structure (1996) | 5.2% | 5.8% |
| Most Recent 10 Years | 6.9% | 6.5% |
| Most Recent 5 Years | 4.4% | 3.7% |
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* | 1,195.80 | 8.3% | 1,136.82 | 9.0% |
Average Percent Increase
| Gross Rate % Change | Net Rate % Change | |
|---|---|---|
| From Inception of 5 Tier Structure (1996) | 6.4% | 6.8% |
| Most Recent 10 Years | 8.5% | 8.2% |
| Most Recent 5 Years | 6.2% | 5.6% |
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* | 934.74 | 9.0% | 885.93 | 10.3% |
Average Percent Increase
| Gross Rate % Change | Net Rate % Change | |
|---|---|---|
| From Inception of 5 Tier Structure (1996) | 5.1% | 5.7% |
| Most Recent 10 Years | 7.7% | 7.3% |
| Most Recent 5 Years | 4.9% | 4.3% |
* Projected 2010 rates are based on Carrier 1st Qtr Best Estimated projections.
(1) Represents premiums paid to the carriers.
(2) Represents cost to a participating agency.
(3) Inception of Medprime Rate Structure.
Exhibit V
EMPIRE PLAN
PA 2 TIER GROUP RATES
2001-2010 Monthly Rates
(For Illustrative Purposes Only)
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* | 580.53 | 10.1% | 551.50 | 10.8% |
Average Percent Increase
| Gross Rate % Change | Net Rate % Change | |
|---|---|---|
| From Inception (1986) | 7.8% | 7.7% |
| Most Recent 10 Years | 8.4% | 8.1% |
| Most Recent 5 Years | 6.1% | 5.5% |
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 | 6.0% |
| 2009 | 1,230.02 | -0.3% | 1,165.24 | 1.3% |
| 2010 projected* | 1,325.20 | 7.7% | 1,260.39 | 8.2% |
Average Percent Increase
| Gross Rate % Change | Net Rate % Change | |
|---|---|---|
| From Inception (1986) | 8.2% | 8.1% |
| Most Recent 10 Years | 8.7% | 8.5% |
| Most Recent 5 Years | 6.5% | 6.0% |
* Projected 2010 rates are based on Carrier 1st Qtr Best Estimated projections.
(1) Represents premiums charged by the carriers.
(2) Represents cost to a participating agency.
First Quarter - 2009
Dependent Eligibility Verification Project
As indicated in the previous report, the NYSHIP dependent eligibility audit is underway. You may refer to PA Memo 09-06, dated March 5, 2009, for details about this project. The 60-day amnesty period, during which enrollees can remove ineligible dependents without penalty, ends on June 12. Over 16,000 dependents will be voluntarily removed from coverage effective June 13. Budco will process Special Amnesty Forms received through June 23, 2009; any forms received after that date will not be processed and the dependent will not be eligible to be removed during the Special Amnesty Period.
The Dependent Eligibility Verification Period will run for 90 days from August 28–November 25, 2009. During this period, 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 effective February 1, 2009 and enrollees will be responsible for claim payments made on behalf of ineligible dependents back to that date. The State will be offering COBRA coverage to those dependents of State enrollees removed
The Employee Benefits Division will continue to keep you informed of the status of this important project.
Legislation Regarding Health Benefits for Volunteer Firefighters and EMTs
As you may be aware, legislation was passed in 2008 to allow emergency services volunteers to participate in public employee health insurance plans. This legislation does not currently apply to NYSHIP since it did not include an amendment to Civil Service Law with regard to eligibility of volunteers. This could be changed by a future amendment. We will keep you informed of any new developments on this issue.
Participating Provider Update - Mt. Kisco Medical Group
For those participating agencies in the mid/lower Hudson Valley and Westchester County areas, we are pleased to announce that the Mt. Kisco Medical Group will be joining the Empire Plan network effective August 1, 2009. This is a very large group that covers an extensive geographic area and we are confident that Empire Plan enrollees will be very happy with this addition to our network.
Increase in Surcharges on Health Insurance Premiums
The Employee Benefits Division has continued to receive numerous inquiries about the State’s recent increases in health insurance assessments and how NYSHIP rates will be affected. As indicated in the previous report, there will NOT be any mid-year NYSHIP rate increases as a result of this.
NYBEAS Upgrade
The Employee Benefits Division issued PA Memo 09-14, dated May 29, 2009, which provided full details about the NYBEAS upgrade, including the timetable, navigation instructions and the demonstration system. The upgrade took place June 4–8 and NYBEAS became available on June 9. Staff continues to deal with any questions and to develop any necessary modifications.
Medicare Part D Employer Subsidy Update
To date, NYSHIP applied for and received estimated Employer Subsidies through the first quarter of 2009 (through March 2009); the latest subsidy was applied to the bill issued the first week of June for July 2009 coverage. The Department will continue to credit PA bills as the employer subsidies are received.
PA Regional Meetings - Fall 2009
The PA Regional Meetings have been scheduled for Fall 2009 as follows:
Transmission of Reports Electronically
Many agencies receive the Empire Plan Experience Report via E-mail. If you would like to be added to our distribution list, you may contact us at the address or E-mail below.
October 14 - Saratoga
October 21 - Rockland County
October 22 - Long Island
Please reserve these dates on your calendars - the meeting notices with full details will be distributed later this summer.
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.
Transmission of Reports Electronically
Many Participating Agencies have requested to receive the Empire Plan Experience Reports via e-mail. Beginning with this report, we are now offering all agencies the opportunity to have an easy access electronically through the following direct link to our website: http://www.cs.ny.gov/employee-benefits/pa-market/financial-reports.cfm
CEO & HBA Name and Address Changes
Please be sure to notify EBD of any changes in the names and/or addresses (including E-mail address) of your agency’s CEO or HBA, so that we may keep our mailing lists up-to-date. This updated information should be sent to:
Debbie D’Orazio
NYS Department of Civil Service
Employee Benefits Division
Alfred E. Smith State Office Building
Albany, NY 12239
or E-mail: Deborah.Dorazio@cs.state.ny.us
Exhibits I - PDF Version
Exhibits II - PDF Version
Exhibits III - PDF Version
Exhibits IV - PDF Version
Exhibits V - PDF Version
NYSHIP News - PDF Version