I’ve switched to the University of South Carolina’s employee health insurance plan effective September 1st. Before that I was on the Duke Grad Student plan. Both plans were self-funded by the employer which means the state or the university paid all the claims while the insurance company just did the administrative grunt work of running a plan. South Carolina’s standard plan is roughly a Gold plan while its low cost plan is roughly a Silver plan. The Duke plan was a platinum plan. Both networks are pretty damn broad. The Duke plan was “free” to me while the South Carolina saver’s plan has an employee deduction from my paycheck of less than a burrito per pay-check. These are both good plans!
But the impact of age on risk pools is amazing.
At Duke I was an elderly grad student. The median grad student was likely in their late 20s. The women were disproportionally unlikely to be pregnant relative to their age-cohort. We were CHEAP and in any given year, relatively low risk!
At South Carolina, I’m probably pretty damn close to the median aged enrollee. Looking up and down my hallway, there are some people about my age, some people substantially younger but still on the employee plan and some people who are notably older.
The average premium reported on my W2 Box 12DD for South Carolina will be substantially higher than my Duke insurance premium not because the benefit is richer (it is not), not because the network is intrinsically better/broader (they’re about the same) but because the risk pool is substantially older. An employer group risk pool typically is healthier than the general population as Medicare and Medicaid act as explicit payers of first resort for several expensive categories of care and a de facto high cost risk pool through the disability system, but even within employer groups, there are massive differences in group composition.
Quick Stop, Nebraska! Nebraska?
dnfree
Excellent points and explanation! You must have a Ph.D. or something.
That’s always worth remembering about Medicare—it’s a group that is quite likely to experience expensive health care needs suddenly, and ongoing. Our premiums don’t cover its cost.
narya
When I started working at my last employer, before the ACA, health insurance was crazy-expensive. Why? Because a significant percentage of employees were living with HIV and it was a relatively small workforce (about 300 people, IIRC). By the time I left, the workforce had more than doubled, the ACA had kicked in, ARV meds could get >95% of people undetectable, and PrEP was available for at-risk folks. In addition, as a matter of policy, anyone making under a certain amount could get insurance through the HMO at no cost to them (PPOs and more family members increased the employee cost). It was still expensive for folks such as me–I think they should have had more than three tiers of employee costs, but that’s because I knew what the salary ranges were. It was fascinating to see so many factors in play: medical science; the insurance marketplace landscape; treatments and prevention for HIV; and agency policy. Sometimes I feel like my workplace prepared me to understand at least some of your work.
Anonymous At Work
There are not other employees substantially younger than you are in your area of USC. There are “whippersnappers” and “young’uns” and “gosh-darn walkin’ fetuses”.
MUSC is a quality institution, so the network size and quality is probably pretty good too.
Jacel
Any differences due to the different states involved (NC vs SC)?
David Anderson
@Jacel: not enough to really matter
Anonymous At Work
@David Anderson: NC residents as a whole doesn’t go to absolute pieces when they see a few snowflakes. When anyone in SC sees some snowflakes, the eggs, the bread, and the milk sells out of grocery stores within the hour.
pluky
@Jacel: One of the major changes we made to our pricing models was to shift from state based area adjustment factors (way too broad!) to MSA based ones. Risk for someone in the SF Bay was radically different than say Fresno. Of course, area is only one for many factors used to adjust risk from manual base rate.
Fake Irishman
And at the University of Michigan we leveraged this fact into no-premium health insurance for our grad student local.
UM: We want to create a graduate student health plan with a narrow network (basically UM affiliated docs.)
Grad Union: we’re not thrilled.
UM: this on net saves us lots of money.
Grad union: Fine, but you will guarantee zero premiums for us in the contract, right?
UM: no.
Grad Union: Would be a shame if grades didn’t get turned in this term.
UM: Um, how about we put in this complicated mathematical formula that essentially gives you what you want but protects us on the high end?
Grad Union: *runs spreadsheet* Ok, just make sure trans students can get coverage.
University. *delays for three months*
FINE.
The grad employee plan total premium cost was about $235 a month in 2010. The standard plan for university employees was pretty much the same coverage (with a wider network) was something like $450.
EthylEster
I lived in SC once.
Hated it. Every moment.
I hope it works out for you.