Update on TRS-Care Medicare Advantage Option
Many TRTA members expressed concern and shared questions with us regarding the potential changes to the TRS-Care health insurance program. Betsey Jones, Director of Health Care Policy for TRS, was kind enough to review a list of those questions compiled by TRTA and respond to them.
What are the changes being discussed?
Medicare Advantage—A health insurance product that takes the place of Medicare and TRS-Care. This plan, while taking the place of these two options, does not remove an individual from the TRS health care program. A TRS-Care Medicare Advantage option is different in benefit coverage and doctor networks than what may be available in the individual market.
- Employer Group Waiver Program—A prescription drug option that moves a retiree into the Medicare D Prescription Drug plan. This plan has been enhanced significantly from the time of its introduction almost 5 years ago. The overall benefit and cost savings is far more advantageous to the plan member (a TRS-Care participant) and plan sponsor (TRS-Care).
Are these plans linked to the Affordable Care Act (ACA)?
- The Medicare Advantage Plan is NOT linked to the Affordable Care Act.
- The Employer Group Waiver Program (EGWP), the prescription drug component, is linked to the Affordable Care Act. The original Medicare D provided a “donut hole” in the prescription drug coverage where participants picked up more of the overall cost. The Affordable Care Act has a provision that reduces the cost of prescription drugs in the donut hole by 50%. This change allows TRS to save millions of dollars by using this plan in lieu of receiving a reimbursement from the federal government, as has been the case for the last few years.
- If the Affordable Care Act is declared unconstitutional, TRS will reevaluate their decision on EGWP and adjust their decisions accordingly.
What did the TRS Board recommend for the Medicare Advantage Plan?
- TRS-Care will incorporate a Medicare Advantage Plan as a choice for retirees eligible for this option.
- The plan provider will be Aetna. Aetna was picked for their large network, current relationship with TRS-Care, strong pricing, and ability to communicate with and advocate for TRS retirees in their Advantage plan.
- As an additional incentive for retirees participating in the Medicare Advantage plan, retirees will receive a $15 per month reduction in their premiums.
- In addition, Medicare Advantage deductibles will be reduced by 50%.
- If you are in TRS-Care 3 and choose Medicare Advantage, your deductible will be reduced from $300 to $150.
- If you are in TRS-Care 2 and choose Medicare Advantage, your deductible will be reduced from $1,000 to $500.
- A retiree participating in the Medicare D plan will have a $5 reduction in copays for generic and preferred brand drugs.
- The Medicare D plan will also:
- Eliminate the requirement that participants pay the difference in cost between brand and generic drugs when a generic is available;
- Offer premium and copay assistance for certain low income individuals;
- Improve benefits for participants faced with catastrophic pharmacy costs.
- TRS-Care participants eligible for the Medicare Advantage plan and the Medicare D plan will be automatically enrolled. Members need to know that plan participation is voluntary. Though you will be auto-enrolled, you can withdraw from Medicare Advantage, Medicare D, or both. Those who withdraw will revert back to the plan they are already using.
- The more people that participate in the plans, the more that TRS-Care will save. The incorporation of the Medicare Advantage and Medicare D plans could save TRS-Care as much as $385 million or more. This will help extend the solvency of the TRS-Care plan to at least 2016.
- The Medicare Advantage Plan is designed to provide coverage as good, and in many cases, better than the current TRS-Care plans 2 or 3.
- TRS will offer direct member informational sessions through the state’s regional service center network, establish a toll-free information line and provide written materials explaining TRS-Care participant options.
TRTA Executive Director Tim Lee addressed the TRS Board of Trustees at today’s meeting regarding the TRS-Care Medicare Advantage proposal. “This plan design option is one that offers many benefits to both the member and the TRS-Care plan. Clearly, the success of these options is based on members understanding them, allowing members to receive care from the health care providers of their choice, and the plan not acting as a ‘gatekeeper’ to those services.”
Mr. Lee presented a list of concerns that must be addressed and satisfied for retirees to consider this option one they can be comfortable participating in. This list of concerns was a culmination of questions expressed by TRTA members.
In response, the TRS Board invited the Aetna representative (the selected provider) to answer many questions at today’s meeting. Some of those answers included:
- The Medicare Advantage product is designed to be as good or better than current options;
- The plan is NOT the same product as may be available in the private market–this is a product designed for TRS-Care participants;
- Aetna will not act as a “gatekeeper.” Aetna describes this plan as an “open access program” that allows you to utilize their health advocate network as much or as little as you wish;
- There are no referrals needed for service; Aetna and TRS believe that a referral system with this plan design is not helpful as many TRS members may need to see more than one doctor every month;
- There may be some instances when a doctor may take Medicare and not Medicare Advantage. TRS expects Aetna to work with the provider and reach out to the provider community to resolve any issues to the fullest extent possible. Those TRS-Care participants who feel it is more beneficial to remain in their current TRS-Care 2 or TRS-Care 3 plan may choose to do so;
- For those interested in trying the Medicare Advantage plan, but concerned you will have difficulty switching back to TRS-Care if you decide to opt out, TRS explains that you will go back into your original plan (TRS-Care 2 or TRS-Care 3);
- If you are not eligible for Medicare A y B, you will not be auto-enrolled in this plan and you will remain on TRS-Care 2 or 3 (depending on your coverage);
- Non-Medicare Advantage participants will not see premium reductions or benefit enhancements that are available in the Advantage plan, but premiums and benefits for TRS-Care 2 and 3 are unchanged for the coming year.
TRTA believes that the Teacher Retirement System staff and Board of Trustees are providing the best Medicare Advantage plan that is possible for our TRS-Care participants. This option provides a richer benefit, a provider network that is already used for the current TRS-Care plan, lower premium cost and deductibles, assistance through professional health care advocates, plan savings for the TRS-Care plan, and the ability to opt out of the plan without penalty even after the plan is launched in January 2013. TRS-Care will also extend the plan year through December 31, so that retiree deductibles and out of pocket maximum thresholds will not reset at the start of next year.
Many people will still have many questions about plan coverage, doctor choice, and out-of-pocket costs. TRS will launch a broad communications program to answer your questions. TRTA will continue to follow this issue and provide regular information.
The bottom line is that this Medicare Advantage proposal may be very beneficial for those who qualify for it. The proof, though, will be in Aetna educating members, answering questions, and working with doctors and medical providers to ensure their participation in the plan.
Thank you for all your questions about this issue. We are working hard to get the answers you need. A copy of Tim Lee’s letter to the TRS Board of Trustees will be posted to the TRTA web site for your review. Please feel free to send more questions and feedback, and we will address these issues with TRS.
We appreciate your membership in the Texas Retired Teachers Association. Your membership is what helps this organization represent your interests’ with TRS, the Texas Legislature, and to help protect and improve your retirement benefits. If you are not a member and would like to know more about joining TRTA, please contact our office at 1.800.880.1650.
TRTA will provide an additional update on other TRS business issues in the coming days.