Effective July 1 2020 South Central Service Cooperative 2075 Lookout Drive North Mankato MN 56603 5073862970 wsandemnscscorg We are Minnesota Strong 2 A special note to our members ID: 813417
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Slide1
2020 School Pool Renewal Effective July 1, 2020
South Central Service Cooperative2075 Lookout DriveNorth Mankato, MN 56603507-386-2970wsande@mnscsc.org
We are Minnesota Strong
Slide22A special note to our members:As we all confront the challenges ahead of us, we want to assure all of our members of the continuation
and integrity of their health benefits. Our SCSC-Blue Cross pooled benefit plans are fully funded and continue to provide comprehensive, (federally mandated) coverage for testing and treatments for the COVID 19 virus. Our wide access AWARE provider network will continue to provide our members with coverage at the Mayo Clinic. Information about a free COVID 19 assessment for our members can be found at the following site address:https://www.doctorondemand.com/coronavirus?utm_source=consumer&utm_medium=web&utm_campaign=COVID19_HomeBanner_LearnMoreLP
Renewal Management:
We realize that current events
will make us re-think how we manage our
group renewals. Our staff is available to meet with you
virtually
to review your
renewals.
If you need help setting up a virtual meeting, please contact us.
We will be reaching out to you shortly to schedule a time to
meet with you virtually. In
the meantime, if you have any questions, please contact:
Wendell Sande
wsande@mnscsc.org
507-386-2970
Bill Colopoulos
bc@nexgenhce.com
507-206-7419
Andrew
Roos
Andrew.Roos@bluecrossmn.com
651-662-0433
Janet Doyle
Janet.Doyle@bluecrossmn.com
651-662-0430
Slide33AgendaWe will cover the following items in our meeting today:
PART 1Our pooling organizationSCSC pooling advantagesSelf-insurance purchasing advantagesOur school pool demographics, risk rating and paymentsHow we are spending our health care dollarsWhere we are seeking careMedical and Pharmacy cost breakdownsClaims distribution among our pool populationHSA changes for 2020
Strategies that can help lower our demand for health care services
PART 2
7-1-2020 Large Group Formula
7-1-2020 Small Group Formula
New statewide small group pool
Slide4Statewide economies and negotiationStatewide stop loss
Statewide small group poolingRegional large group poolingLocal decision making:Pool member managementLocal board controlPlan design choiceProvider choiceNo referrals requiredVEBA, Flex and HSA accountsStatewide – Regional School
Pools4
Northeast
Service Cooperative
Southeast Service Cooperative
Northwest Service Cooperative
Resource Training and Solutions
Lakes County Service Cooperative
South Central Service Cooperative
Southwest West Central Service Cooperative
Slide5Top Seven SCSC School Pool Advantages
5Self insured financing (wholesale, low cost and no risk to members)Cooperative aggregate purchasing (spreads risk among fellow pool members and lowers cost)Our pool is fully reserved; provides guaranteed benefits for membersUnlimited stop loss liability for pool members
Group-level plan
design flexibility (Networks,
deductibles, CDHP
,
Rx, etc.)
Consumer directed (health plans and savings accounts, VEBA/HSA)
Wellness-focused
(OMADA,
ShareCare
,
SmartShopper, Learn To Live)We are committed to the health and well-being of our members
Slide6South Central pool members are self insured (buy wholesale)
No risk to pool members for claims or assessments Low administrative charges Reserves held to guarantee risk and lower costs spikesPharmacy rebates are applied to pool reservesStatewide stop loss program
Self-Insured
Financing:
Lowest Cost Purchasing Platform
6
Slide7South Central pool members are provided unlimited stop loss protection for high claims in the following ways:
Individual claims in excess of $100,000 for groups with 51-99 employees on their health planIndividual claims in excess of $200,000 for groups with 100+ employees on their health planStatewide, we purchase $500,000 individual stop loss and self-insure the differences to (2) and (3).Statewide aggregate claims liability is limited to 110% of overall projected claims liability. Any amount in excess of 110% is guaranteed by Blue Cross.Self-Insured Financing: Statewide Stop Loss
7
Slide8SCSC School Pool Demographics8
South Central Service Cooperative - School Pool / 4th Quarter 2018: Claims Incurred July 2018 to June 2019 And Paid through August 2019 Provided by Blue Cross Blue Shield of MN - The content of this report is confidential and proprietary. Unauthorized use is prohibited.* Blue Cross Client List MN
Slide9Episode Risk Groups (ERG) *9
South Central Service Cooperative - School Pool / 4th Quarter 2018: Claims Incurred July 2018 to June 2019 And Paid through August 2019 Provided by Blue Cross Blue Shield of MN - The content of this report is confidential and proprietary. Unauthorized use is prohibited.* The above is an illness burden score that is calculated using a population-based case-mix adjustment system named Episode Risk Groups (ERG). The analysis provides comparison of the school pool’s population's health relative to a larger population (i.e. the Blue Cross commercial book of business) and the ability to compare school employees’
utilization of heath care resources to a larger benchmark population. ERGs account for age, gender and disease/conditions based on claims data. Values above 1.0 (the Blue Cross commercial book of business average) suggests a 'less healthy' population while values below 1.0 suggest a 'healthier' population.
What is our relative health?
Slide10SCSC School Pool Total Payments10
South Central Service Cooperative - School Pool / 4th Quarter 2018: Claims Incurred July 2018 to June 2019 And Paid through August 2019 Provided by Blue Cross Blue Shield of MN - The content of this report is confidential and proprietary. Unauthorized use is prohibited.* Blue Cross Client List MN
Slide11SCSC School Pool Individual Claimants above $75,00011
South Central Service Cooperative - School Pool / 4th Quarter 2018: Claims Incurred July 2018 to June 2019 And Paid through August 2019 Provided by Blue Cross Blue Shield of MN - The content of this report is confidential and proprietary. Unauthorized use is prohibited.* Blue Cross Client List MN
Slide12SCSC School Pool Paid by Major Categories12
South Central Service Cooperative - School Pool / 4th Quarter 2018: Claims Incurred July 2018 to June 2019 And Paid through August 2019 Provided by Blue Cross Blue Shield of MN - The content of this report is confidential and proprietary. Unauthorized use is prohibited.* Blue Cross Client List MN
Slide13SCSC School Pool Costs13
South Central Service Cooperative - School Pool / 4th Quarter 2018: Claims Incurred July 2018 to June 2019 And Paid through August 2019 Provided by Blue Cross Blue Shield of MN - The content of this report is confidential and proprietary. Unauthorized use is prohibited.* Blue Cross Client List MNNote the increase in ER: Time for Telemedicine??
Slide14SCSC School Pool Medical Provider Network Discounts14
South Central Service Cooperative - School Pool / 4th Quarter 2018: Claims Incurred July 2018 to June 2019 And Paid through August 2019 Provided by Blue Cross Blue Shield of MN - The content of this report is confidential and proprietary. Unauthorized use is prohibited.* Blue Cross Client List MNNote the difference from reference: this is “the Mayo effect” in our region
Slide15SCSC School Pool Utilization15
South Central Service Cooperative - School Pool / 4th Quarter 2018: Claims Incurred July 2018 to June 2019 And Paid through August 2019 Provided by Blue Cross Blue Shield of MN - The content of this report is confidential and proprietary. Unauthorized use is prohibited.* Blue Cross Client List MN
Slide16Healthcare Utilization16
South Central Service Cooperative - School Pool / 4th Quarter 2018: Claims Incurred July 2018 to June 2019 And Paid through August 2019 Provided by Blue Cross Blue Shield of MN - The content of this report is confidential and proprietary. Unauthorized use is prohibited.What conditions are driving our costs?
Slide17Prevalence of Common Chronic Diseases17
Chronic diseases are diseases that are persistent and long-lasting. They limit what a person can do and may require ongoing care. Some conditions cause few problems. Others cause episodic problems or symptoms that can be controlled with medication.South Central Service Cooperative - School Pool / 4th Quarter 2018: Claims Incurred July 2018 to June 2019 And Paid through August 2019 Provided by Blue Cross Blue Shield of MN - The content of this report is confidential and proprietary. Unauthorized use is prohibited.
What is our risk exposure to COVID 19?
Slide18Top Ten Inpatient Hospital Admissions18
South Central Service Cooperative - School Pool / 4th Quarter 2018: Claims Incurred July 2018 to June 2019 And Paid through August 2019 Provided by Blue Cross Blue Shield of MN - The content of this report is confidential and proprietary. Unauthorized use is prohibited.* Blue Cross Client List MN
Slide19Top Ten Inpatient Hospital Providers and Costs19
South Central Service Cooperative - School Pool / 4th Quarter 2018: Claims Incurred July 2018 to June 2019 And Paid through August 2019 Provided by Blue Cross Blue Shield of MN - The content of this report is confidential and proprietary. Unauthorized use is prohibited.Mayo is our provider-of-choice for nearly half of our inpatient care
Slide20Top Ten Outpatient Providers and Costs20
South Central Service Cooperative - School Pool / 4th Quarter 2018: Claims Incurred July 2018 to June 2019 And Paid through August 2019 Provided by Blue Cross Blue Shield of MN - The content of this report is confidential and proprietary. Unauthorized use is prohibited.Mayo is our provider-of-choice for nearly half of our outpatient care
Slide21Top Ten Professional Services Providers and Cost21
South Central Service Cooperative - School Pool / 4th Quarter 2018: Claims Incurred July 2018 to June 2019 And Paid through August 2019 Provided by Blue Cross Blue Shield of MN - The content of this report is confidential and proprietary. Unauthorized use is prohibited.Mayo is our provider-of-choice for 86% of our top ten professional services providers; more than half overall.
Slide22Pharmacy Costs and Utilization22
South Central Service Cooperative - School Pool / 4th Quarter 2018: Claims Incurred July 2018 to June 2019 And Paid through August 2019 Provided by Blue Cross Blue Shield of MN - The content of this report is confidential and proprietary. Unauthorized use is prohibited.* Blue Cross Client List MNWe rely on our expansive formulary (covered drug list)
Slide23Pharmacy Top 15 Therapeutic Classes23
South Central Service Cooperative - School Pool / 4th Quarter 2018: Claims Incurred July 2018 to June 2019 And Paid through August 2019 Provided by Blue Cross Blue Shield of MN - The content of this report is confidential and proprietary. Unauthorized use is prohibited.
Slide24Preventive Care Utilization24
South Central Service Cooperative - School Pool / 4th Quarter 2018: Claims Incurred July 2018 to June 2019 And Paid through August 2019 Provided by Blue Cross Blue Shield of MN - The content of this report is confidential and proprietary. Unauthorized use is prohibited.
Slide25Member Utilization25
South Central Service Cooperative - School Pool / 4th Quarter 2018: Claims Incurred July 2018 to June 2019 And Paid through August 2019 Provided by Blue Cross Blue Shield of MN - The content of this report is confidential and proprietary. Unauthorized use is prohibited.72% of us have less than $500 in claims
Slide262020 Changes to Health Savings Accounts26
Note that there are mandatory plan changes for some HSA plans in 2020
Slide27Strategies to Bend the Health Care Cost Curve
27Lower the Demand for Health Care Services:Promote a culture of health through prevention, public health and support of healthy behaviorsImprove informed patient decision-making at all points, including at end-of-lifeCreate practical tools to assist patients in seeking appropriate care (e.g., Telemedicine)Shifting more health care cost
(responsibility) to patients through higher deductibles and cost sharing; especially for preventable conditions
Improve
coordination through better data sharing
Implement
Value-Based
benefit program features
Make more investments
in social services
What behavioral changes can we make to use fewer health care services?
Slide28SCSC School Pool Renewal Formula
Effective July 1, 202028
Slide29The following formula applies to all SCSC School Pool 7-1-2020 renewals for groups with 51 + employee plan participants (as of 2-15-2020):Maximum renewal increase: +15.0%Minimum renewal increase:
+2.5%Groups that fall in between the min and max will receive their actual calculated renewal increase. Special considerations may be made for plan design and other program changes.Renewal confirmations will be extended until May 15th. SCSC Large Group Renewal Formula29
Slide30SCSC Small Group Renewal Formula30
SCSC in cooperation with the other six service cooperative members of the Minnesota Health Care Consortium has formed a single, statewide pool for all small groups. The purpose of this pool is to bring greater rate stability to our small groups by rating them together at the statewide level, rather than regionally.Small Group Pool FeaturesOur small groups will be rated together statewide.Groups will be placed in three risk bands; each band will have its own renewal increase.The new small group pool is being managed together by all of the participating regions. Small groups will retain their current plan designs.Each group will receive their renewal from their region. In our case, SCSC staff will present each renewal as it has done in the past.Our small group renewals will be effective on 7-1-2020.
Slide31SCSC Small Group Renewal Formula31
Groups will be placed in the three renewal bands listed below according to a hybrid formula for each group; based on their:Risk factors: Group claims vs manual rate (plan design value, census and region)Premium factors: Current group premium level vs benefit valueThe risk-premium hybrid method is designed to provide small groups in the new statewide pool with the best opportunity for continued rate stability in 2020 and beyond. Small Group Renewal Bands for 7-1-2020:High risk band groups: +12.5%Mid risk band groups: +7.5%Low risk band groups: +4.0%
Any plan design changes groups may consider will be based on the above renewal formulas and optional rate realignments for groups that offer more than one plan (see next slide).
Slide32SCSC Small Group Rate Realignment32
Groups with more than one health plan have traditionally received the same rate increase for all of their plans. Over time, this practice creates an imbalance between a plan’s premium and benefit value relative to the premium and benefit value of other plans that are offered.Why is this important? Without periodic rate realignment, members may end up paying higher premiums than they should for high deductible plans and lower premiums than they should for low deductible plans. In order to help our small groups realign their premiums with their plan deductibles, we have produced rate realignment factors for each of our small groups that have more than one plan. Our client management staff will assist our small groups in evaluating how rate realignment may help their group. This will be an optional process, since rate realignment may not be practical for all groups with more than one plan. Each small group renewal will be issued with the overall renewal applied equally to all plans. We will present small group rate realignment factors in a separate renewal exhibit for each group that has more than one plan.
Please note: Rate realignment does not apply to groups with only one plan.
Slide3333DISCLAIMERT
he information included in this presentation is intended for general information purposes only. It is not to be used for nor construed to be legal or tax advice.Any U.S. federal tax or other regulatory agency references made herein are not intended to be used, and cannot be used, by any person or business entity for the purpose of avoiding any penalties that may be imposed by the IRS or any other governing agency, state or federal. Under IRS rules governing tax advice, a taxpayer may rely on professional advice to avoid federal tax penalties only if that advice is provided in a tax opinion that conforms to federal requirements.