RD83 - Report on the State Employee Health Plan Proposed Premium and Benefit Structure for Fiscal Year 2014


Executive Summary:
As required in Item 84(F) of the 2012 Appropriations Act, this report details the assumptions included in Governor McDonnell’s introduced budget for the state employee health insurance program. The report includes the proposed changes to the benefit structure. It also includes provisional premium schedules. Part A contains the provisional premiums submitted by Aon Hewitt, the health plan’s actuary, in November 2012, which were then provided to the Department of Planning and Budget. Part B includes the premium schedule and the General Fund Breakout developed by the Department of Planning and Budget. Part C contains the subsequent proposed premiums submitted by Aon Hewitt in January 2013.

Governor McDonnell proposed two plan changes for fiscal year 2014. The first is a Mandatory Mail/Retail Maintenance Network with a 90-day retail copay equal to two times the 30-day retail copay. This change should produce an estimated $10,378,000 in savings. The second proposed change is to increase the emergency room copay from $125 to $150, which is estimated to produce $909,000 in savings. The impact of these plan design changes was not included in the Aon Hewitt premium projections. At the conclusion of the legislative process, these premiums will be finalized.