Note:
This story was clarified on Sept. 27, 2007. For more information, visit our
corrections/clarifications
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By Dave Ranney
KHI News Service
TOPEKA, Sept. 25
Preferred Health Systems wants a bigger piece of the state-employee health insurance market.
The Wichita-based company recently ran full-page ads in several newspapers, calling state employees” attention to their being able to save $1,415 a year in premiums by choosing Preferred Health Systems.
The ads coincide with Kansas Health Policy Authority plans to unveil a new health insurance benefit package for state employees next week.
State employees will have a month to choose a plan. The new policies will take effect Jan. 1.
Currently, Preferred Health Systems and its nearest competitor, Coventry Health Care of Kansas, divide about 13 percent of the state-employee market.
Blue Cross Blue Shield has the remaining 87 percent.
All three competing companies will offer two benefit packages set by the health policy authority:
Plan A State employees will pay 10 percent of the cost of claims co-insurance up
to a maximum of $1,000 for individuals and $2,000 for families.
Plan B State employees will pay 35 percent of the cost of claims co-insurance up
to a maximum of $2,200 for individuals and $4,400 for families.
Under both plans, once the co-insurance limits are met, 100 percent of claims will be paid by the insurance.
Premiums will vary, depending on which plan the employee chooses, on the employee”s income, and the number of people to be covered.
Each company”s premiums, too, will vary.
“For state employees making less than $27,000 a year who are on the family plan and who chose Plan A, the difference between the Preferred and Coventry plans is $1,415 a year,” said Dennis Manson, manager for sales support at Preferred Health System”s central office in Wichita.
According to a rate calculator on Preferred Health Systems” Web site, the company”s premiums in
that scenario would be $182.88 a year less than those charged by Blue Cross Blue Shield.
Mary Beth Chambers, manager of corporate communications at Blue Cross and Blue Shield, objected to the Preferred Health Systems ad.
“They”re not comparing apples to apples, they”re comparing apples to oranges,” Chambers said. “It”s our position that while premiums may be a factor, they”re not the only factor. People need to sit down, look at plans and see which one is best for them, which one has the best network, the best customer service and the best value-added options. They need to compare apples to apples.”
Chambers urged state employees to check out the insurers” provider networks before choosing one over the other.
“The provider network is the most important thing,” she said. “You might have to change doctors to receive the full benefit of whichever plan you choose.”
Blue Cross Blue Shields” network, she said, is the largest in the state.
Manson defended the ad, noting that while Preferred Health Systems” network may not be as large as Blue Cross Blue Shields,” it”s more than adequate for most families.
“State employees are going to find that we stack up very well
at lower rates,” he said.
Coventry Health Care of Kansas officials did not respond to calls seeking comment.
The new health-insurance plans are expected to include several incentives designed to emphasize preventive care and to encourage state employees to lead healthier lifestyles.
According to KHPA data, one-third of the 88,000 people
adults and children
covered by the state employee health insurance plans are overweight or obese. Nearly one in four smokes.
At the Kansas Public Health Association”s fall conference in Wichita last week, KHPA executive director Marcia Nielsen said the new plans will include:
* Up to $300 in smoking cessation assistance per employee per year.
* Incentives for taking part in health risk assessments to help craft personal health improvement plans.
* A significant increase in the state”s contribution for health insurance premium costs for those with family plans.
To encourage state workers to get preventive care, neither of the benefit packages will require co-pays for annual physicals, mammograms, bone density screenings, colonoscopies, and immunizations.
State-employee reaction to the plan remains to be seen.
“Frankly, a lot of what people are going to think is going to depend on the premiums,” said Ron Hagen, a senior agent with the Kansas Bureau of Investigation who”s active in the Kansas Organization for State Employees.
“We”ve got a lot of people who don”t make much money,” he said. “Their decisions are going to depend on what they can afford.”
Hagen said he has heard several state employees in western Kansas complain about not having access to the breadth of provider networks available in the eastern half of the state.
“They say they only get one choice and that”s Blue Cross,” he said.
Charlotte Rommel, a former member of the Kansas State Health Care Commission, said she”s concerned that many state employees will simply opt for the cheapest premiums.
“A decision based on premium cost alone can end up costing you a lot more out of pocket
believe me, I know from personal experience,” she said. “There needs to be a lot of education on this.”
-Dave Ranney is a staff writer for KHI News Service, which specializes in coverage of health issues facing Kansans. He can be reached at
dranney@khi.org
or at 785-233-5443, ext. 128.