Arkansas legislative panel backs proposed changes to health insurance plan for public schools and state employees


Most current employees of state health insurance plans for public school and state employees would pay less than they currently do under proposed changes for calendar year 2023 that a panel legislative approved on Wednesday.

Many retired Medicare-eligible members who participate in state health insurance plans would pay lower premiums next year than they do now if they opted for Medicare Advantage with prescription drug coverage in framework of bonuses proposed by the Oversight Sub-Committee of the Legislative Council Employee Benefits Division. recommended that the board approve today.

Last week, the State Board of Finance approved premium changes proposed by the State Benefits Division for 2023.

In another action Wednesday, Department of Transformation and Shared Services Secretary Mitch Rouse told the legislative panel that the state would withdraw its request for proposals for a pharmacy benefits manager for the state’s employee benefits division. State and would develop another request for proposals for a concert pharmacy manager. with a consultant from the Bureau of Legislative Research, The Segal Group of Atlanta.

The announcement came after lawmakers and state officials huddled privately for more than 45 minutes during a subcommittee meeting recess.

The private meeting came after state Rep. Jeff Wardlaw, R-Hermitage, said the Segal Group was concerned it had been left out of the RFP process, then Rouse said the The Crown had not yet issued a contract award notice. and cautioned against disclosing confidential information under state procurement law.

Proposed premiums for state health insurance plans for state and public school employees and retirees will implement new policies passed by the state Board of Finance last month, said to lawmakers Director of the Employee Benefits Division, Jake Bleed.

Under a new policy passed by the finance board, the state will adjust base rates to reflect how much a member should pay based on plan experience, Bleed said.

Under another new policy, the state will aim to pay around 80% of the total cost of providing health insurance to its employees, up from the current average of around 65% of the total cost, it said. -he declares. The state’s 65% share of the total benefit cost is quite low compared to the shares paid by neighboring states, he said.

The new policies will be phased in over five years, starting in 2023, rather than within a year and will cause disruption, with some members and the state paying significantly more and other members paying significantly less, a said Bleed.

Last month, the finance council also voted to eliminate the $25 per month wellness credit offered to plan members and the $25 monthly contribution for non-wellness program participants.

About 83%, or 39,653, of the current 47,912 employees of the state health insurance plan for public school employees would pay fewer premiums next year than they do this year if they stick to the same coverage under this proposal, according to Bleed.

For example, about 12,452 public school workers with employee-only coverage in the state’s classic plan and receiving the welfare credit are paying $96.02 a month in premiums this year, and their cost would fall. to $94.83 per month in 2023 under the proposal.

About 75%, or 17,939, of the current 23,661 employees of the state health insurance plan for state employees would pay less premiums next year than they do this year if they s stick to the same cover, according to Bleed. He noted that 1,500 current state employees are not paying a premium for the basic plan this year and would not be paying next year under the proposed rates.

For example, about 9,060 state employees with employee-only coverage in the Premium Plan and receiving the Wellness Credit are paying $176.20 a month in premiums this year. This cost would decrease to $172 per month in 2023 under this proposal.


About 14,049 public school retirees, eligible for Medicare and with retiree-only coverage, are paying $100.78 a month this year. Their cost would soar to $110.89 per month in 2023 if they stick with their current coverage under the Employee Benefits Division proposal. However, they would only pay $8.53 a month in 2023 if they opted for Medicare Advantage with prescription drug coverage under the state’s proposal.

About 8,222 state employee retirees eligible for Medicare with retiree-only coverage are paying $193.12 a month this year and would pay $211.85 a month in 2023 if they stuck to their plan. current coverage under the state proposal.

However, they would only pay $16.53 per month in 2023 if they opted for Medicare Advantage with prescription drug coverage under this proposal.

The state’s Benefits Division has contracted with United Healthcare Insurance Co. to provide the Medicare Advantage Group with prescription drug coverage for eligible retirees in the state health insurance plan for school employees. public and state.

Perryville’s Winston Simpson, a retired Lafayette County School District superintendent, told lawmakers Wednesday he wants the subcommittee and Bleed to ensure that public and state school retirees eligible for Medicare have access to medical services through the Medicare Advantage plan with prescription drugs. coverage without improper prior authorization for services. He said he wanted to make sure those retirees can access Medicare Advantage plan benefits in a timely manner.

Wardlaw said he wanted to make sure the public understands that those Medicare-eligible retirees will be eligible for the group Medicare Advantage plan, which is different from individual Medicare Advantage plans. He encouraged state lawmakers to attend meetings in their districts aimed at educating these retirees about the Medicare Advantage group plan.

Retirees age 65 or older or otherwise eligible for Medicare will automatically be enrolled in the Medicare Advantage program and have the option to opt out or retain existing benefits.

Bleed said Medicare-eligible retirees will be able to opt out of the Medicare Advantage group plan in November and will have another option to opt out in January.

“It’s not something they’re forced into,” he said.

The Medicare Advantage program will provide significant savings to retirees and the state, and United Healthcare will work statewide to educate retirees and healthcare providers about the program to ensure that all retirees have the opportunity to make informed decisions, according to Bleed.


Rouse told the Legislative Committee of the State Purchasing Office that he was leading “he will withdraw” a request for proposals for a pharmacy benefits manager for the Employee Benefits Division.

“We’re going to start from scratch,” he said. “We will be working with the Segal Group in the future. We will cooperate with them and collaborate with them on the development of the RFP and its re-commissioning.”

The State Office of Purchasing issued a revised Request for Proposal for the Employee Benefits Division to hire a Pharmacy Benefits Manager on May 6. The deadline for pharmacy benefit managers to submit proposals was June 10.

Wardlaw told lawmakers the Segal Group feared it had been left out of the RFP process.

This led Rouse to inform lawmakers that the state has yet to issue a contract award notice and “under the law of public procurement, we cannot discuss the specifics of what has been submitted.

“We can talk about the process in general…but we can’t talk about individual scoring, who scored what, which vendors were qualified, which vendors were disqualified, specific vendors who made bids,” he said. he declares. “We can’t talk about who submitted what and what they submitted and what the costs were or anything of that nature because we want to make sure that who we select, who wins this RFP , is done in an objective process that is for the best interest of the state.

“Introducing outside influence into an objective process before a vendor is expected to move forward violates that process,” Rouse told lawmakers and state officials gathered at a meeting. in camera.

In January, the Legislative Council approved an office contract of up to $611,200 with the Segal Group through December 31, 2024, for the consultant to work with the State Employee Benefits Division to write an RFP for a Pharmacy Benefits Manager and help write an RFP for a provider to provide Medicare Advantage prescription drug coverage to public school and state retirees

On Wednesday, the Legislative Council’s executive subcommittee ordered the office to negotiate a contract with the Segal Group to provide health insurance actuarial consulting services to employees, after the consultant was the only company to submit a proposal in response to the bureau’s request for proposals.

Earlier this year, the Legislature enacted Bill 112 during the tax session to require a tax impact statement for any bill imposing a new or increased cost obligation for health benefit plans on an entity of state, and require that such bills be introduced within the first 15 days of a regular session

The Segal Group submitted a maximum bid of $227,150, according to office records. The contract with the consultant will begin on August 19 and end on June 30, 2023, with an option to renew for an additional two years each, according to the office’s request for proposals.

Rep. Jeff Wardlaw (center) calls for a recess during the Arkansas Legislative Council Executive Subcommittee meeting Wednesday at the state Capitol. (Arkansas Democrat-Gazette/Staci Vandagriff)

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