#03 - 2025 Medical Insurance Renewals

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City Of Lake Elmo September 20, 2024 Page 2 The PEIP program continues to do very well, our revised pooling methods have lowered the volatility of renewal increases again. In an ongoing effort to improve the program we have implemented the following changes for 2025. PLEASE READ CAREFULLY: 1. In 2023 the state hired an outside consulting firm to make recommendations on improving PEIP. One of their recommendations was to realign the benefit offerings to make the program easier to understand. Based on this recommendation, the state decided to discontinue the Value plan for 2025. We continue to see a reduction in enrollment in this plan (down to about 8% of the total enrollment in PEIP). The Value plan included higher out of pocket expenses than the HSA option, so only a very small group of participants were better off on Value. 2. Based on revisions to the PEIP statute 43A.316 and recommendations from the same study, the group enrollment commitment in PEIP will change. Previously enrollment in PEIP was based on a two-year commitment, with an early termination option if a group received a renewal of 50% or more. The study recommended that the enrollment commitment be extended to four years, with an early termination option if you received a renewal of 20% or more. The goal of this change is to bring more stability to the pool. More stability helps to decrease volatility in renewal increases. In the first 10 years of the current pooling methodology, the plan had very high stability which resulted in average increases of approximately 3%. When the pool saw increased movement from our groups, the rate increases became higher. This return to stability will allow the plan to pool claims at a higher level which we anticipate will help keep rate volatility down. Your group is in year One of your two-year commitment so this renewal complies with the previous statute. 3. Effective 1/1/2025 the office visit copay in the Advantage High plan will increase $5.00. 4. The HSA deductible and out of pocket maximums will increase to meet IRS rules. A reminder of a couple of plan enhancements from last year. 1. Enhanced coverage of infertility for Blue Cross members (similar to HealthPartners coverage) 2. $0 or reduced office copays for mental health treatment PEIP continues to offer unique features to our public employer groups. • An individual choice of two network providers for each employee, along with two plan design options. • Very low administrative costs by leveraging with the State of Minnesota employees’ contracts with each of the two network carriers.