Tuesday, March 6, 2018

State Health Plan Saves $35 Million through Medicare Advantage Enrollment Honors General Assembly Recommendation of years ago

Raleigh
Mar 6, 2018

3/6/2018

Contact: Frank Lester (919) 814-3811

FOR IMMEDIATE RELEASE

State Health Plan Saves $35 Million through Medicare Advantage Enrollment

Honors General Assembly Recommendation of years ago

(Raleigh, N.C.) – State Treasurer Dale R. Folwell, CPA, announced today that the State Health Plan (SHP) will generate $35 million in savings as a result of the increase in members enrolled in the UnitedHealthcare (UHC) Medicare Advantage plans. Treasurer Folwell released the numbers during his monthly “Ask Me Anything" conference call, part of his initiative to promote transparency.

 

In an effort to improve member satisfaction and generate additional savings, the State Health Plan automatically enrolled its Medicare-eligible members in a premium-free Medicare Advantage Base Plan during open enrollment in October 2017.

 

Approximately 86 percent of Medicare-eligible members remained enrolled in a UnitedHealthcare Medicare Advantage Base Plan for the 2018 benefit year.

“The move to UHC's Medicare Advantage products are a win-win for members and taxpayers," said Folwell. “Members love the simplicity and value offered by the UHC plans. They have one plan and one card for both medical and drug coverage as well as access to great programs like SilverSneakers, while providing substantial savings for taxpayers."

 

During open enrollment, members were given the opportunity to opt out if they preferred another health plan option. This effort aligns with a 2015 report from the North Carolina General Assembly's Program Evaluation Division, which suggested that the plan require Medicare-eligible members to enroll in Medicare Advantage plans in order to reduce costs.

 

The $35 million in savings follows the renegotiation of the contract between the SHP and UHC to provide Medicare-eligible retirees with Medicare Advantage health insurance plans in 2018. The rate for the basic plan decreased to $120 a month for 2018, down from $120.65 a month in 2017, despite increasing health care costs.

 

In 2017 approximately 125,000 of 166,000 Medicare-eligible members (75 percent) were enrolled in one of the two fully insured Medicare Advantage plans offered by UHC.  The other 41,000 Medicare-eligible members were enrolled in a different plan option, where the plan is responsible for claims costs after Medicare has paid its share.

 

The State Health Plan, a division of the N.C. Department of State Treasurer, is the largest purchaser of health care in North Carolina. The plan provides coverage to nearly 730,000 teachers, state employees, retirees, current and former lawmakers, state university and community college personnel, and their dependents.