Employee Health Costs Rise Again

By VIC COX

Faced with a 15 percent gross increase in HMO premiums over 2003, the University of California is passing some of this burden on to employees in 2004. UC is still picking up the majority of the medical plan costs and all employee premiums for dental and vision plans, according to an announcement last month from UC's Human Resources and Benefits Office.

A salary-based, four-tier contribution structure for 2004 will again aid employees paid $40,000 or less. Other premium tiers run from $40,001 to $80,000 (and includes retirees not on Medicare); $80,001 to $120,000; and over $120,000.

Taking Health Net, the most common HMO for UCSB employees, as an example, a family of two adults and one or more children will pay $35.62 a month if the subscriber earns no more than $40,000 next year. A single adult in the same salary range will pay $12.29 for the same benefits.

Moving up a tier to the below-$80,001 level, the subscriber with spouse and child or children would pay $86.43 for the same Health Net package while a single employee, earning the same salary, pays $25.27 for the coverage. Since this bracket also includes retirees not on Medicare, it acts as a cap for annuitants with spouses who will pay $66.21 but otherwise would be paying $109.26 or $142.86, depending on their incomes and assuming no dependent children.

More details, including premium rates for Health Net and the nine other medical plans, are available at <http://atyourservice.ucop.edu/>.

Nonretired UCSB employees weighing the new Definity Health Plan (outlined in the Sept. 22, 2003 issue of 93106) now have the plan's costs to consider. For the $40,000-tier employees, the premiums range from $29.17 for singles to $97.74 for families. The other rates are also posted at the above Web site.

"People who are satisfied with their HMOs probably will not consider Definity, due to its higher cost," said Laura Morgan, health care facilitator. However, she added, it may attract employees on the Blue Cross PLUS plan. These subscribers already deal with an out-of-network provider system that requires a $500 deductible and picks up 70 percent of the cost of using these physicians. Definity compares favorably in these aspects.

"People need to crunch their individual numbers," advised Morgan, then balance the costs against greater access to physicians with Definity. She and assistant Debra Herrera will be leading the workshops on Tuesday, Oct. 7, at 1:30 p.m. and on Oct. 22 at 9 a.m. for Human Resources on the Definity option, currently available only to employees at UCSB and UC San Francisco.