Flexible Spending Accounts Enrollment Continues To Climb

Helping employees understand the benefits of pretax programs is complex, but through an extended open enrollment period and new communications efforts, including a colorful targeted postcard mailing, enrollment in the Health Care Spending Account and Dependent Care Assistance Program increased 10.7% to more than 18,200 members.

Retiree Dental Plan Enhanced

GIC staff, our consultant, and our dental carrier analyzed the very popular retiree dental plan to see how benefits for this retiree-pay-all program could be modified without unduly affecting costs.  As a result of this analysis, the Commission adopted the following benefit enhancements and changes for July 1, 2013.  These changes were approved in the fall to give potential municipalities an opportunity to opt into the more comprehensive program:

  • The annual maximum benefit increased to $1,250 per member per year
  • Dental implants covered for first time
  • Provider reimbursements for the 10 most common procedures increased, translating into lower out-of-pocket costs for members
  • The frequency of coverage for certain services changed in keeping with industry standards.

Premiums increased only 3.4% as the result of these changes.  Coupled with the new municipal enrollments, enrollments increased by over 2,500.

Pharmacy Benefit Manager Contract Saves Money

The GIC carves out pharmacy benefits for all UniCare members, representing 150,000 lives, predominantly retirees, and expenditures of over $200 million per year.  With the last year of the three-year contract ending with CVS Caremark at the end of the fiscal year, the GIC completed extensive analysis and subsequent negotiation of new contract terms with assistance from our consultant.  The GIC executed a two-year contract extension that will result in savings of approximately $19 million in FY14 and FY15.

Medicare Part D Efforts Continue to Help Commonwealth’s Bottom Line

Through FY12, a total of $161.5 million had been sent to the Commonwealth’s General Fund as the result of the GIC’s reconciliation process with the federal government and four of our prescription drug plans for Medicare members.  The FY13 work translated into an additional $24.5 million reimbursement bringing the overall total reimbursement to $186 million.

Audits Pay Dividends

Four audits were performed in FY13, providing a valuable review of the claims payment operations of four of the GIC’s insurance vendors.  Overall accuracy has risen over the years from the low eightieth percentile and is now in the high ninetieth percentile, but audits provide a useful tool for finding areas of potential improvement.  The audits looked at financial accuracy, compliance with GIC benefits, and claims turnaround time.  Both UniCare and Health New England performed very well on their audits. Fallon’s audit revealed need for improvement and Neighborhood Health Plan’s audit uncovered systemic issues that needed to be addressed, particularly regarding copay and deductible errors.  Across all of the plans audited, lab charges, which are now reviewed on an automated basis, had been charged by providers as being reviewed by pathologists, representing $400,000 in upcharges that should not have been paid.  This error has been corrected across all plans, the GIC was reimbursed for errors found, and staff is working with the plans to address other areas that need improvement.

Awards and Recognition

One hundred percent of GIC staff participated in this year’s Commonwealth of Massachusetts Employee Charitable Campaign (COMECC) campaign, with total donations up 9%.  Staff monetary donations were supplemented with a book sale that raised almost $100.  The GIC also received an Operational Services Division Supplier Diversity Women-Owned Business Enterprise (WBE) award for meeting and exceeding its WBE purchasing benchmarks.

This information provided by the Group Insurance Commission .