New changes to Connecticut’s Teacher Retirement Board health plan means that retired teachers will now see a difference in the health insurance coverage they receive. The plan, which provided a low-cost health insurance option for Connecticut teachers, has now been divided into two options, with the base option offering less coverage than the previous standard plan.
Under the current TRB plan, retired Connecticut public school teachers and their spouses receive health insurance coverage that extends beyond their Medicare coverage. The TRB plan is funded in thirds by:
- A payroll deduction from active teachers
- The State of Connecticut
- The retiree
Once the retiree’s Medicare deductible is paid, the TRB plan helps to cover most of their remaining medical costs. TRB enrollees also benefit from prescription drug and dental benefits.
Changes to the Connecticut Teachers Retirement Board Health Plan
According to the new changes to the TRB health plan, participants will face increased costs. The State of Connecticut, which funds a third of the plan’s cost, has been underfunded by almost $200 million during the last 8 years, and is currently flat funded with no increases available.
Additionally, enrollment in the TRB continues to grow, and the unit cost for the plan increases as medical care costs grow. These cost challenges, paired with the underfunding, have resulted in changes to the TRB health plan which will impact Connecticut teacher retirement health insurance options.
Under the new plan, TRB will offer two medical plan options, instead of the previous single plan:
Anthem Medicare Advantage Plan
A Medicare Advantage (MA) plan available through Anthem will become the base plan. This plan carries a premium of $134 per month per person. The plan package includes drugs, dental, vision, and hearing coverage. Out-of-country coverage is basically fully covered.
Stirling Buy Up Option
The Stirling plan will become a “buy-up” option. This plan carries a premium of $259 per month per person. The plan offers lower out-of-pocket costs than the Anthem Medicare Advantage plan.
While the two plans offer similar coverage, there are differences in some of the out-of-pocket maximums and copays that participants will see. The Stirling plan may be a better option for participants who have high demand of healthcare services.
The Medicare Advantage plan is a better option for those who use healthcare services less often, or who have a catastrophic event during the course of the year.
To enroll in the new Sterling plan buy-up option, a participant will pay $1,500 more per year to access the coverage they previously had. Two individuals would pay $3,000 more per year to access that coverage.The alternative to both these options is a Connecticut Medicare Supplement plan.
Additional changes to the TRB health plan that participants should be aware of:
- The prescription plan deductible has increased from $400 to $405. After the deductible is met, copays for generic drugs (5%), preferred brand name drugs (20%), and non-preferred brand name drugs (30%) enter the picture. Under the previous plan, there were no copays for generic drugs.
- The prescription plan carries a maximum out of pocket of $1,205 per member per year, which has increased from the $1,150 on the previous plan.
The changes are effective as of July 1, 2018. Plan participants will need to make their decisions about which option they wish to pursue during the month of April.
These changes could spell financial difficulty for retired teachers who need a high degree of medical care. While they can still access the base plan, the buy-up option offers better coverage for frequent medical needs, but at an increased cost.
For teachers who have already retired and no longer have a steady income, any increase in health care costs can be difficult to absorb into a budget.
What could this mean for Connecticut teacher retirement? Teachers may push off retirement in order to increase their savings, or in hopes that the plan offerings may change in the future.
Teachers who are already retired may face a difficult decision in terms of which plan to choose, and may even opt for the new base plan to avoid the increased cost of paying for the insurance, itself.
Teachers concerned about the two new options should consider a Medigap plan to supplement their Original Medicare coverage. Since a Medicare Advantage plan has many limitations, including not being able to choose your own doctor and higher out of pocket expenses, a Medicare Supplement option may be the better choice.
Alternative to the Anthem Medicare Advantage Plan & Sterling Plan
Open Enrollment begins the middle of April and will run until early May. Members should receive a pre-enrollment kit prior to April 1st. Every member will be automatically enrolled in the Anthem Medicare Advantage plan, unless they choose to opt out and remain in the Sterling plan.
If a member rather stay in the Sterling plan, the pre-enrollment kit will include instruction on how to opt out of the Medicare Advantage Anthem plan. If you rather go with the alternative and enroll in a Medicare Supplement plan, contact us today. We’ll compare the rates in your area to make sure you get the healthcare coverage you want.