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15 May
0

HB 3976 Passes Out of the Senate State Affairs Committee, Huffman Proposes $20 Million In Prescription Coverage to Be Added

Today, May 15, 2017, the Senate Committee on State Affairs met to vote on CSHB 3976, the bill designed to prevent the TRS-Care death spiral. Senator Joan Huffman (R-Houston), who chairs the State Affairs Committee, is the bill’s sponsor.

The Texas Retired Teachers Association (TRTA) published an update about CSHB 3976 this past Friday, May 12, providing members with answers to questions about projected program changes. You may read that update by clicking here.

The bill passed 8-0, and will now proceed to the Texas Senate floor, where it will be discussed. The Texas Retired Teachers Association (TRTA) will keep members apprised of the bill’s progress and possible dates for it to be heard on the floor.

New: Prescription Benefit Added to HB 3976 for Participants Under Age 65

Senator Huffman provided a committee substitute to the bill. The substitute adds a benefit that many retirees have asked for, $20 million in prescription drug coverage. Huffman’s plan would be to provide coverage for generic prescription maintenance drugs for under age 65 participants, listing several conditions for which certain drugs would be free of charge under the plan.

“I know you have all heard from the retired teachers (about prescription coverage),” Huffman said.

She stated that these would be fairly standard drugs, covering such conditions as diabetes and osteoporosis. TRS will likely provide a list of covered prescriptions after session. This benefit is a welcome addition to the bill. Prescriptions that do not meet the criteria set by TRS will still be subject to the deductible.

As our TRTA members may know, HB 3976 calls for a high-deductible plan for retirees under the age of 65 with a $3,000 deductible. No separate prescription plan has been included as part of the bill for those participants. Instead, prescriptions would be included in the $3,000 deductible. The age 65 or older retirees, who would be transitioned to the Medicare Advantage plan, have their own prescription plan.

Huffman also stated that she will advocate for the money to ensure that the CSHB 3976 plan structure is used, including adding the free prescription benefit. She will also advocate for enough money to use the House deductible of $3,000 (the Senate proposal deductible was $4,000), and the House proposed premiums (these premiums are about $50 cheaper than what was originally proposed). She also supports increasing the school district contribution.

“There will still be a shortfall in two years, this problem is not going away easily,” Huffman said. “We will continue to work towards making sure retired teachers have the health care they need.”

Senator Brian Birdwell (R-Granbury) questioned whether the Senate would fund the plan “with hard dollars” or by using the Economic Stabilization Fund (ESF), also known as the Rainy Day Fund. As our members may recall, the House approved using $500 million from the Rainy Day Fund to help pay for TRS-Care this coming biennium.

Senator Huffman, who serves on the conference committee that will decide the final version of the state budget, said again that she believed it is “not the majority will of the Senate to use the Rainy Day Fund.”

The Texas House has voted to use Rainy Day Fund to assist TRS-Care. The Senate’s budget refrains from using Rainy Day Funds. In order for retirees to receive the best possible benefits from CSHB 3976, the House and Senate will need to agree upon a budget that can sustain TRS-Care.

“We should have started fixing this last session, but instead we wrote a check,” Huffman said.

During the 84th Legislative Session in 2015, the Legislature provided $768 million in supplemental funds to cover the TRS-Care shortfall. Huffman said that this occurred because the state was flush with cash at the time, but that no structural changes were made to the program. “We don’t have extra money in GR (general revenue) lying around now like we did last session.”

Huffman also stated that CSHB 3976 has to pass, “because if it doesn’t the plan will go into a death spiral. This is a must (pass) bill, because if not, the retired teachers are in really bad shape.”

Huffman also said that she is committed to using the general revenue needed to get the plan she laid out today passed, and that she believes Senator Jane Nelson (R-Flower Mound), who chairs Senate Finance, is also committed. However, she reminded Senator Birdwell that she cannot speak for the other members on the budget conference committee.

Tim Lee, Executive Director of TRTA, testified in support of the bill, stressing his appreciation for the continued improvements and work on the bill. TRTA President, Nancy Byler, and Legislative Coordinator, Bill Barnes, were also in attendance for the meeting.

Lee said many retirees if asked, “wouldn’t even venture a guess” on where the funding comes from.

“Retirees are more concerned about what it will cost them,” Lee said.

He shared Huffman’s sentiment that the bill must pass, but that “we also need a budget that funds the benefit structure laid out.”

TRTA has worked all session to see the best resolution to this difficult issue. TRTA members deserve affordable health care, and the organization understands its members concerns about the current funding options.

Lee ended his testimony with a plea: “Please hear our outcry. We need as much money as possible in order for our retirees to be able to afford this program.”

Senator Craig Estes (R-Wichita Falls) stated his support for the bill, saying there are “no easy answers, but we have to come up with some answers. If we fail to act, it will lead to a catastrophic result.”

What Happens Next

CSHB 3976 has passed out of committee, and its next step is to be heard at by the full Senate. There still may be changes to the bill, as it can be amended on the floor.

While this bill is not a perfect solution, it is best option on the table, and it will prevent TRS-Care’s collapse. Funding is what makes a difference. Over the next four days, TRTA will work with legislators to get the most money possible for TRS-Care. The more money provided by the Legislature, the better the plan will be for retirees.

Thank You

Thank you for your membership to TRTA. We are fighting ardently for your benefits every day at the Capitol. If you are not yet a TRTA member, please join here.

This is TRTA’s most challenging moment. The TRS-Care plan would be significantly worse without your advocacy! We can and will make a difference in affecting positive change for TRS-Care legislation.

Be sure to like us on Facebookfollow us on Twitter and subscribe to our YouTube channel.

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12 May
0

More Q&A About TRS-Care Projected Changes

Use TRTA’s Action Alert to contact your legislators.

The Texas Retired Teachers Association (TRTA) continues to field questions about the possible changes that will come with the passage of HB 3976, the TRS-Care bill. On Monday, May 8, TRTA sent out an Inside Line specifically addressing potential changes for participants age 65 and over. You can read that update by clicking here.

Many people have asked how HB 3976 will affect TRS-Care’s current health care options, TRS-Care 1, 2 and 3. Those options will no longer be available, and TRS will only have a high-deductible option for pre-65 participants and a Medicare Advantage option for participants age 65 and older.

If HB 3976 does not pass (along with the funding provided by the state budget), the current plan will remain in place for a brief time. However, due to the shortfall, TRS has testified that they may raise premiums astronomically to cover the difference. It is predicted that in that scenario, the program would go into a death spiral and may end completely within two years, leaving retirees with no access at all to TRS health care.

While no solution yet offered by TRS or worked on by the Legislature may seem perfect, it is unacceptable for retirees to have no health care coverage. We are all working with the facts provided by TRS, and TRTA is working with the Texas Legislature to develop the best possible outcome for TRS-Care.

TRTA is reporting on projected deductible and premium amounts, which are a part of the legislative process. Please be aware, all plan design decisions will be finalized by the TRS Board of Trustees later this year.

There is still time to make improvements to these proposals, and we have many dedicated friends in the Legislature working to help us. TRTA members are encouraged to contact their legislators and support these efforts.

Are You Under the Age of 65?

Currently, for retirees under the age of 65, TRS-Care offers three options: TRS-Care 1, 2, or 3. TRS-Care 1 is a premium-free catastrophic plan. Tiers 2 and 3 have premiums and richer benefits, with tier 3 providing the highest level of coverage. However, if HB 3976 passes, those tiers will no longer exist. The only plan available for retirees who choose to remain with TRS insurance will be a high-deductible (HD) plan, as described here.

The current Express Scripts prescription co-pay structure for TRS-Care tiers 2 and 3 will cease to exist if HB 3976 passes. Instead, prescriptions will be included within the $3,000 deductible in the new HD plan. Participants will pay full price for prescriptions until the deductible is met, at which time prescriptions will be covered at 80 percent by the insurance plan and at 20 percent by the insured.

The one advantage for retirees is that TRS uses “a pharmaceutical benefit manager” (PBM) to acquire reduced price prescriptions. The current TRS PBM is Express Scripts. When a TRS-Care participant utilizes the Express Scripts benefit option, the full-cost prescriptions price likely will be discounted and lower than regular market prices.

TRTA has long argued for a more substantial TRS-Care pre-65 prescription drug plan that utilizes a traditional co-pay methodology. This option costs more money, and the decisions about how to fund this or other improvements are now in the hands of the legislative budget conferees. TRTA will continue to make the case for a more substantial prescription drug benefit.

TRS is projecting retiree premiums to be $200/month. With a spouse, the projected premiums are $739/month. With a family, the projected premiums are $1,074/month. Premiums are projected to rise $50/month each year. Please know that each individual participating in the plan will have have to meet their own $3,000 deductible. Maximum out-of-pocket costs will be set by TRS.

Are You Age 65 or Older?

Currently, retirees age 65 and over can choose between the Medicare Advantage (MA) plan offered through TRS, or have Medicare be their primary coverage and use a TRS-Care 2 or 3 as their supplemental coverage.

Upon the passage of HB 3976, the option to choose between either Medicare Advantage or have a TRS-Care tier as your supplemental coverage will go away. The only option available for retirees age 65 and over who choose to remain with TRS will be to transition into the Medicare Advantage plan. TRS is estimating the MA plan deductible will be $500.

The TRS MA plan will be a “group” plan rather than an “individual” plan. As such, the “group plan” benefits should be better for retirees, and the reimbursement should be better for providers than what may be experienced in “individual” MA plans. TRTA is working with legislative leaders to help providers, such as physicians and hospitals, understand the difference and be more amenable to accepting the TRS-Care MA plan.

There will be a separate prescription drug plan available for MA participants with its own co-pay structure if HB 3976 passes. This is a more traditional co-pay structure retirees are familiar with, and is not the same as described in the section above for retirees under the age of 65.

TRTA has been asked if the amounts provided in Monday’s Inside Line about spousal coverage under the MA plan are correct (the projected premium cost to cover the retiree is $146/month, with spouse an additional $444/month, for a total of $590/month). The answer is yes. While this is a projected cost and amounts are not yet set in stone, this projection is the one being provided by TRS staff at this time. Retirees have also asked if they will still have to pay for Medicare Part B premium, and the answer is yes.

I Am Not Medicare Part A Eligible, What Will Happen to My Health Care?

TRTA has been told that Medicare Part B-only retirees will be included in the Medicare Advantage plan and will participate in the same blended premium rate as all the over 65 retirees, or a projected $146/month. Retirees have also asked if they will still have to pay for Medicare Part B premium, and the answer is yes.

If HB 3976 Passes, When Will the Changes Go into Effect?

Plans for both age groups would go into effect on January 1, 2018 if HB 3976 passes. The current TRS-Care plans will remain in place through December 31, 2017. Please bear in mind that after the legislative session ends, TRS will be responsible for setting the final premium and deductible amounts for the new insurance plans. The numbers we have been providing to you throughout session are estimates and are subject to change.

Can Participants Opt Out of the Plan?

TRTA has received questions about whether or not retirees can opt out of TRS-Care.

WARNING!!! TRS-CARE PARTICIPANTS DO NOT NEED TO MAKE A DECISION ABOUT OPTING OUT ANYTIME SOON. THE LEGISLATURE IS STILL TAKING ACTION AND IMPROVEMENTS ARE STILL POSSIBLE ON THIS ISSUE.

IN ADDITION, THE TRS BOARD MUST STILL SET PLAN DESIGN CHANGES AND ADDITIONAL RULES BEFORE THE ISSUE IS FINALIZED. OPTING OUT MAY BE AN IRREVOCABLE DECISION, AND YOU SHOULD HAVE COMPLETE INFORMATION BEFORE YOU MAKE A DECISION ABOUT YOUR HEALTH CARE.

Yes, those choosing to leave TRS insurance plans may do so. For participants under the age of 65, HB 3976 will allow them to join the Medicare Advantage plan upon turning age 65. Remember, Medicare Advantage will be the only option for retirees in that age group as of January 2018.

What Happens Next for HB 3976?

Use TRTA’s Action Alert to contact your legislators!

HB 3976 passed the House last week, and has now been referred to the Senate State Affairs Committee. TRTA just found out today that the bill will receive a hearing in that committee on Monday, May 15. The meeting begins at 9:00 a.m. in the Senate Chamber. Members, be sure to check this link on Monday morning about 15 minutes before 9:00 a.m. to find a link to a live webcast of the hearing.

TRTA will keep members posted about the bill’s progress. You can learn more about HB 3976 by clicking here. TRTA will continue to read your comments and try to provide answers in a timely fashion. Members may also want to read our Frequently Asked Questions page about TRS-Care here.

Thank You

Thank you for your membership to TRTA. We are fighting ardently for your benefits every day at the Capitol. If you are not yet a TRTA member, please join here.

This is TRTA’s most challenging moment. The TRS-Care plan would be significantly worse without your advocacy! We can and will make a difference in affecting positive change for TRS-Care legislation.

Be sure to like us on Facebookfollow us on Twitter and subscribe to our YouTube channel.

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08 May
0

Questions About Medicare Advantage Answered

Many members of the Texas Retired Teachers Association (TRTA) who are age 65 or over have called and emailed asking about the probable changes that will occur with their medical insurance after the legislative session ends. While there are many questions to address regarding all of the tenets of HB 3976, this Inside Line specifically addresses concerns about the TRS Medicare Advantage plan through Humana.

As our members may know, if HB 3976 passes through the legislative process and becomes law, TRS retirees age 65 and over who participate in a TRS-Care insurance plan will be transitioned to the TRS Medicare Advantage plan. This plan will be the only option available. This plan would go into effect on Jan. 1, 2018.

Any retirees entering the program on or before Dec. 31, 2017 will join the current TRS-Care plan, then be transferred to the new plan on Jan. 1, 2018.

Projected 65 and Over Retiree Premium Costs for Medicare Advantage (Retiree only):

Plan Year 2018-2021: $146/month

The projected premium cost to cover the retiree and spouse is $590 per month. (TRTA recognizes that the spousal cost is very high and our members are asking us to explore alternative options for their spouses. This information may not be available until after the Legislative Session.)

Members call us asking if their doctors will be able to participate in the MA plan if they are out of network. Many others have said their providers have stated simply that they do not accept any MA plans whatsoever.

While TRTA will continue to work with the Legislature and the Teacher Retirement System of Texas (TRS) on statewide acceptance of the plan, TRS has provided some answers to your questions about the plan that we would like to share with you now. The fact sheets below are also available online.

FAQs: TRS-Care Medicare Advantage Fact Page

Think Your Doctor Won’t Accept TRS-Care Medicare Advantage? Fact Page

Thank You

Thank you for your membership to TRTA. We are fighting ardently for your benefits every day at the Capitol. If you are not yet a TRTA member, please join here. Be sure to read our comprehensive Frequently Asked Questions about TRS-Care here.

Be sure to like us on Facebookfollow us on Twitter and subscribe to our YouTube channel.

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