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?
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 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.