Health Insurance Premiums to Increase in 2021
In case you missed it, the following message was emailed to employees’ Outlook inboxes on Monday, Oct. 12.
Over the last several years, efforts by the Montgomery County Public Schools’ Employee and Retiree Services Center (ERSC), in partnership with our unions, has allowed us to provide cost-efficient high-quality health insurance coverage for staff. In particular, those efforts resulted in MCPS being able to contain costs and even forego employee premium contributions in December 2018. Through careful management and effective cost containment actions on the part of the school system and individual employees with health insurance coverage, premium increases have been minimal in recent years.
Unfortunately, expenses related to testing, treatment and care of COVID-19, and a general trend of increase in the cost of care, among other things, will require an increase in premiums for 2021. The increases per paycheck will range from $2.59 (for a 12-month employee, with single coverage in the CareFirst HMO plan) to $16.91 (for a 10-month employee, with family coverage in the CareFirst Point-of-Service plan). The required premium increases range from 7.2% to 9.3%, depending on plan and coverage. It is important to note that while the premium share (the portions paid by the Board of Education and the employee, respectively) are covered by negotiations, the increases in premiums from year to year are not. The negotiated premium split has always been honored and is scheduled to remain unchanged for three additional years.
However, to offset the impact of increased health care expenses expected next year, the Board of Education has decided that no insurance premiums will be paid by employees in January 2021. The increased premium will take effect beginning with the February 12, 2021 paycheck. The Board of Education will continue to contribute the 83% or 88% of premiums toward health insurance costs that is required by the negotiated agreements. This means that on average, for this past year, employees with individual coverage paid about $1,100 for medical and prescription coverage, while the Board paid about $6,250 for each of them. For employees with family coverage, the average was about $3,100 paid by the employee and $17,470 paid by the Board. The shortfall caused by the premium holidays for employees in January 2021 will be made up from the health care contingency fund, reducing that fund to below recommended levels at least temporarily.
The attached rate sheet provides a comparison of healthcare premiums between 2020 and 2021. These rates do not include reductions employees can earn by completing the two wellness initiatives—a Biometrics Health Screening and a Health Risk Assessment. I strongly encourage you to take advantage of the savings through participation in these programs. MCPS will continue to work with our unions to explore options for containing healthcare costs and strengthening the contingency fund balance.
A full listing of employee premium rates, including the wellness discounts, is available on the ERSC website in time for Open Enrollment starting today, October 12, 2020. Please review email communications from the Employee and Retiree Service Center (ERSC) regarding the Employee Benefit Open Enrollment.
Thank you for your understanding.
Daniel K. Marella
Associate Superintendent for Finance
Health Insurance Premiums Rate Sheet, 2020-2021