【正文】 y individual insurance plans permitted by law that can be issued to Medicare Eligible individuals ? Carriers cannot customize plans and must offer “standardized” plans ? Regulated by state insurance authorities within federal government guidelines ? Major providers include AARP, Blues plans, some insurers – AARP in all states with Plan A through J – Blues in all states but limited offering, particularly of plans H, I and J ? Most plans underwrite where allowed – Exception is AARP, with minimal underwriting requirements (only ESRD) except on plans H, I and J 52 Mercer Human Resource Consulting Medigap Policies Policy features Item Plan A Plan B Plan C Plan D Plan E Plan F Plan G Plan H Plan I Plan J Basic Benefits* Skilled Nursing Coinsurance Part A Deductible Part B Deductible Part B Excess Foreign Travel Emergency At Home Recovery Drugs** Preventive Care Approximate Monthly Premium Range $55$150 $90$190 $100$210 $90$200 $100$200 $110$210 $100$230 $150$230 $160$250 $200$290 *Basic Benefits = Part A coinsurance plus 365 extra days of hospital care plus Part B coinsurance plus three pints of blood/year **$250 deductible, 50% coinsurance to contract limit 53 Mercer Human Resource Consulting Medicare Select ? Same standardized plan designs (A through J) as other Med Supp policies – AARP offers it on Plan C only ? Works like a Preferred Provider Organization (PPO) – Full supplemental benefits available if work providers used – Reduction or loss of supplemental benefits if nonwork providers used – Always retain full Medicare benefits ? Most mon provider works are hospitals only – Hospital can waive Part A deductible via safe harbor from antikickback statutes – Limited ability to affect Part B cost – Negotiations with other vendors possible ? Lower cost than Medigap: typically 20% discount – AARP example: Ohio Plan C: $122。 DC for Others Employer pays X% of cost of one specified Plan A (“preferred” or “employer” plan). The amount of employer contribution for Plan A bees the defined dollar contribution for Plans B, C, …。 increases subject to employer discretion ? Not a taxadvantaged approach 40 Mercer Human Resource Consulting Access Only Plans ? Employer “sponsors” pany health plans (stays “in the business”) ? By doing so, retains group underwriting, pricing and risk profile ? Employer contemplates no subsidy ? Full cost and annual increases absorbed by employees/retirees ? Fully insured plans – Works best – Costs known in advance – Premiums fixed in advance ? Selfinsured plans – Requires more management – Costs not known in advance – But premiums must be fixed in advance – Caution regarding active/retiree subsidy – May impact other accounting (FAS 106) 41 Mercer Human Resource Consulting Capped Plans ? “Employer cost will be capped at 2 times the 1993 cost” ? Implication is that employer share bees a fixed dollar mitment at some point in the future ? Typical action taken in early to mid 1990s for retiree programs in response to FAS 106。 $1,000 per year of service for 30 years of service)。 HIPAA may eventually make this a viable option for preMedicare retirees 38 Mercer Human Resource Consulting AccountBased Approaches Examples ? Monthly/annual promise – Retirees receive monthly (or annual) credits of a specified dollar amount (., $100/monthly。 three major national PBMs remain CPI API CPN RxNet Value Rx Diagnostek Perform HCS HPI Diagnostek Value Rx RxNet Columbia Value Rx Express Scripts Express Scripts NPA DPS Express Scripts PAID MEDCO Advanced Paradigm Advance Medco Integrated Prescription Solutions (IPS) PCS Foundation MerckMedco MerckMedco Proadvantage Systemed Paradigm MerckMedco Medco Advance PCS Major Insurers Major Insurers MPS PCS Clinical Pharmacy Advantage 14 Mercer Human Resource Consulting Population Trends Aging baby boomers will increase the elderly and near elderly populations Data Source: . Census Bureau State Population Projections Baby Boomers Year of Birth 1946 to 1964 Source: . Census Bureau as of January 2023 3 , 0 0 08 , 0 0 01 3 , 0 0 01 8 , 0 0 02 3 , 0 0 02 8 , 0 0 020 2425 2930 3435 3940 4445 4950 5455 5960 6465 6970 7475 7980 8485+A g e G r o u pNumber (000s)2 0 0 0 U S P o p u l a t i o nB a b y B o o m e r s. Population, 2023 Projected Population 010203040506070802 0 0 0 2 0 1 0 2023 2030A g e s 5 5 t o 6 4A g e s 6 5 o r O l d e rMillions 15 Mercer Human Resource Consulting Negative Tidal Wave of Available Talent Pool of “prime workers” will be decreasing Source: DRI, World at Work Journal, fourth quarter 2023 Percent Change in Population by Age Group, 202310 20% 10% 0% 10% 20% 30% 40% 50% 60% 59 1014 1519 2024 2529 3034 3539 4044 4549 5054 5559 6064 6569 7074 7579 The “Echo boom” ages 1529 Shrinking Pool of “Prime workers” ages 3044 Aging “Baby boomers” ages 4569 16 Mercer Human Resource Consulting Impact of Demographics on Health Care Cost Cost increases with age 2024 2529 3034 3539 4044 4549 5054 5559 6064 65+ Age Relative Cost by Age Male Female Average employer cost = Relative Costs By Age and Gender 17 Mercer Human Resource Consulting Health Deterioration A cause and a consequence 1 3 . 0 %1 5 . 0 %2 3 . 0 %3 1 . 0 %1 4 . 5 %3 2 . 0 %3 2 . 5 % 3 2 . 0 %3 3 . 5 %3 3 . 0 %0 . 0 %