【正文】 man Resource Consulting AccountBased Approaches ? Defines employer’s mitment as a defined dollar contribution instead of a defined medical benefit ? Commitment can be monthly, annual, aggregate ? Commitment can be based on retireeonly or recognize dependents ? Amounts available for health care only。 “flat” or tied to service。 no employer prefunding required – Payment options ? “Drawdown” on funds (retiree uses funds to pay portion of retiree medical cost。 of uncapped plans ? Many caveats – Usually applied only to those retiring postannouncement – Evaluate separately for preMedicare eligible vs. Medicare eligible, or in aggregate – Evaluate per retiree or in aggregate – Definitions of “premiums” and “costs” ? cross subsidy of actives/retirees can cloud calculations ? Need clear definition of how costs and contributions are calculated before cap is hit ? Enrollees will understand concept, but likely won’t be prepared for eventual increases 42 Mercer Human Resource Consulting Employers Being Less Involved Summary ? Focusing on approaches that allow a fixed employer mitment ? Risk transferred to employees/retirees ? In some versions (caps), no immediate impact felt by participants – Communication is critical ? Employers concerned about participant response 43 Mercer Human Resource Consulting The Two Camps Summarized Fight or Flight ? The largest employers seem willing to try to change the world ? Mid sized and smaller employers seem to want to “get out” of the responsibility ? Neither reflects the traditional way of providing benefits Focus on employers reducing involvement, using a generic defined dollar (defined contribution) approach 44 Mercer Human Resource Consulting Agenda ? The Environment ? The Catch22 ? Paths Away from Traditional Delivery: Two Camps ? Opportunities Along Path 2 ? The Answer ? Additional Topics 45 Mercer Human Resource Consulting Where can we apply “Defined Contribution” approaches most easily? ? Active employees/early retirees – Employers will still need to “sponsor” a plan – Can set employee contributions to meet desired cost share and allow employees to buy back into a selfinsured plan – Easiest calculation if underlying plan is fully insured ? Medicare Eligible Retirees – Employers may actually be able to get all the way out – Even if pany sponsors no Medicare eligible retiree plan, options available in market for retirees to choose from – Some with little or no underwriting (removes access problem) but eligibility/timing important 46 Mercer Human Resource Consulting DC Health Plans in the Spectrum of Employer Contributions % of Cost Employer pays X% (., 80%) of cost of health plans。 DC for Others Pure DC Full Cost High Low 47 Mercer Human Resource Consulting Medicare+Choice Health plan takes risk, receives “capitated” payment ? Medicare “Part C” (Medicare Advantage?) ? Health plan offered by private insurance panies, usually on an HMOlike basis ? Benefits broader than Original Medicare – Reduced out of pocket expenses for deductibles and copayments – May offer prescription drug coverage ? Medicare pays a set amount of money to private insurer ? May be additional premium cost over Part B premium (fully insured to employer) ? Available only in certain areas ? Recent private insurer profitability poor and insurers have curtailed availability and increased costs to retiree 48 Mercer Human Resource Consulting Medicare+Choice HMO Enrollment Enrollment declined for first time in 2023 Source: Medicare Managed Care Contract (MMCC) Plans Monthly Summary Reports from CMS Website () Dec 90 Dec 91 Dec 92 Dec 93 Dec 94 Dec 95 Dec 96 Dec 97 Dec 98 Dec 99 Dec 00 Dec 01 Dec 02 E nrol l ed 1, 26 3, 54 7 1, 38 9, 40 1 1, 56 5, 65 9 1, 81 1, 45 3 2, 26 8, 36 4 3, 08 9, 25 9 4, 11 5, 29 3 5, 21 1, 33 9 6, 05 5, 54 6 6, 34 7, 43 4 6, 26 0, 54 9 5, 48 0, 89 9 4, 92 9, 69 0% G r ow th n/ a 10% 13% 16% 25% 36% 33% 27% 16% 5% 1% 12 % 10 % P l an s 96 93 95 109 154 183 241 307 346 309 266 179 15501 , 0 0 0 , 0 0 02 , 0 0 0 , 0 0 03 , 0 0 0 , 0 0 04 , 0 0 0 , 0 0 05 , 0 0 0 , 0 0 06 , 0 0 0 , 0 0 07 , 0 0 0 , 0 0 08 , 0 0 0 , 0 0 0D e c 9 0 D e c 9 1 D e c 9 2 D e c 9 3 D e c 9 4 D e c 9 5 D e c 9 6 D e c 9 7 D e c 9 8 D e c 9 9 D e c 0 0 D e c 0 1 D e c 0 2Enrollment050100150200250300350400 of PlansT o t E n r H M O s49 Mercer Human Resource Consulting 2023 Medicare+Choice HMO Availability Even after pullbacks, slightly more than threequarters of Medicare Eligibles still live in counties which offer at least one M+C plan in 2023 PFFS Plan Locations Cover Approximately 35% of Medicare Eligibles Over 58% of Medicare Eligibles Live in M+C HMO Areas Source: CMS Medicare Plan Compare Data Sterling Life Insurance Company Coverage Data as of 3/31/023 50 Mercer Human Resource Consulting Medigap Overview Plans supplement “original Medicare” benefits ? Sold to individuals age 65+ (and certain other Medicare Eligibles under 65) ? Medigap carriers must accept all applicants for the first six months of eligibility ? The basic benefits included in every Medigap plan are – Part A coinsurance (for admissions of more than 60 days) – Coverage for 365 additional hospital days after Medicare benefits exhausted – Part B coinsurance – The first three pints of blood each year ? Product types – Standard products ? A through J sold from 1992 to present ? Only H, I and J cover prescription drug – Medicare Select ? Provides Medigap benefits with work discount and lower prices 51 Mercer Human Resource Consulting Medigap Policies Overview AARP and BCBS plans offer majority of products ? Onl