The County of El Paso is currently providing health insurance coverage for Medicare eligible retirees and their spouses through Medicare Group Agreements with Aetna Life Insurance Company. The County has 149 Medicare Eligible retirees/dependents enrolled in the Aetna Medicare Advantage Plan and currently subsidizes 50% of the Medicare Advantage Plan premiums.
In September 2019, the County received the Medicare Advantage Plan Rate Proposal and Renewal from Aetna Life Insurance Company which included an Affordable Care Act (ACA) imposed Health Insurance Providers Fee (HIF) for plan year 2020. The HIF reflected an approximate 16% increase to premiums for plan year 2020.
The current total premium cost is $338,843 annually or $189.51 per member per month which results in the retiree paying $94.75 per member per month and the County paying $94.75 per member per month. The proposed rate increase would result in a total premium cost of $393,592.44 annually or $220.13 per member per month (retiree would pay $110.07 per member per month and the County $110.07 per member per month). This represents an increase of $30.63 per member per month (increase of $15.32 for the Retiree and $15.32 for the County).
In order to reduce the premium increase, Staff is proposing a change to the plan design by implementing a deductible of $100. Currently retirees do not have a deductible. If a $100 deductible was implemented, it would result in a 10.5% premium increase instead of the 16% increase originally imposed by the ACA. The attached rate proposal and renewal reflects the $100 deductible and an increase in premium costs from $189.51 to $209.43 per member per month for plan year 2020 representing an increase of $19.92 per member per month which results in a monthly increase of $9.96 for Retiree and $9.96 for the County.
Below is a breakdown of the total combined per member per month rates:
Current rate: $189.51
ACA proposed rate: $220.13
Staff recommendation: $209.43
The total annual cost to the County based on current enrollment and current payment of 50% of the premiums is $187,221 ($140,416 for 9 months of FY 2020) representing an annual increase of $17,808 (FY 2020 increase of $13,357).
The Aetna Medicare Advantage Plan Rate Proposal and Renewal has been reviewed by the County Attorney’s Office (2019-0796).