Today, the Texas Retired Teachers Association (TRTA) continues its discussion about the Teacher Retirement System of Texas (TRS) sustainability study of the retiree health insurance program TRS-Care.
In our first Inside Line article about the TRS-Care study, we reviewed Option 1: Pre-funding the long-term liability. We also discussed Option 2: Funding on a pay-as-you-go basis for the biennium. Option 3 covered funding for 10-year solvency. We reviewed Option 4: Retirees pay full cost for optional coverage.
Today, we will review Option 5: Mandatory participation in the Medicare Advantage and Medicare Part D plans. Before beginning the explanation of Option 5, members should know that on its own, this option does not resolve the funding shortfall for the coming biennium, but rather could be combined with other options to improve cost savings for TRS-Care as a whole. The previous four options, on the other hand, provide a plan for sustaining TRS-Care at least through the coming biennium.
In Option 5, the mandatory participation in the Medicare Advantage and Medicare Part D plans for Medicare-eligible TRS-Care participants includes a caveat that non-participation would provide the insured with TRS-Care 1 only. This option includes an appeal process, allowing participants to opt out if there is inadequate access to providers that accept Medicare Advantage plans. Please bear in mind that in some parts of the state, Medicare Advantage is not accepted AT ALL.
A recent update provided by the TRS staff indicated that the current participation rate in the TRS-Care Medicare Advantage plan is 68%, while the Medicare Part D plan has 81% participation. The Part D plan is for prescription drugs.
TRS recently began auto-enrolling TRS-Care participants who are aging into Medicare into the Medicare Advantage plan. This means that participants on TRS-Care who are turning 65 years old will automatically become enrolled in Medicare Advantage, with the ability to opt out. This auto-enrolling process began in April 2014.
To improve enrollment in Medicare Advantage, TRS is considering new methods, such as mailing postcards to eligible members and offering to provide one-on-one phone calls to members to help them learn more about the program. They are also planning to create an informational video to better explain the plan as well as the purpose of Medicare Parts A, B and D and how these insurances impact members financially.
Auto-enrolling age-ins into the Medicare Advantage plan is not the same as what Option 5 does. Option 5 does not allow for participants to go back to TRS-Care 2 or 3 for their secondary payer coverage, while the current process does.
With Option 5, retirees who do not or cannot use the Medicare Advantage plan would either need to leave the plan entirely or use the catastrophic coverage provided by TRS-Care 1.
Option 5, if enacted, would not provide as significant a savings to the TRS-Care program on its own; however, in combination with other options, it could be beneficial to the program’s financial status. One reason this option does not provide a huge cost savings to TRS-Care is because it pertains to Medicare-eligible participants only. As you may know, Medicare is the primary payer and TRS-Care is the secondary payer. The non-Medicare population costs the TRS-Care program six times as much as the Medicare population.
This option is one we would like to hear a lot of feedback about. The TRS Retiree Advisory Committee (RAC) expressed concern about this option and their feedback, as well as yours, will be very helpful to TRS as they continue the sustainability study.
TRTA believes the current Medicare Advantage plan is good in many areas, but we are disappointed that the Aetna Medicare Advantage network does not provide consistent provider access across Texas. Efforts by TRS and Aetna to strengthen the current Medicare Advantage network and acceptance of its coverage by more physicians and medical providers are needed to improve the program’s inclusiveness.
Thank you for being a member of TRTA. If you are not a member and would like to join, please contact our Membership Department at 1.800.880.1650.
Please continue reading the Inside Line over the next two weeks as we provide detailed updates about the remaining four options being studied by TRS to improve and sustain the TRS-Care health insurance program. Our next update is about Option 6: Defined contribution-Establish a Health Reimbursement Account (HRA) for non-Medicare retirees.
Share these articles with every retiree you know, as well as with active school personnel! Your input is important. Your membership and support are crucial. Thank you for all your help and support.
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