Group Health to raise premiums

The NMI Retirement Fund Group Health Insurance program proposes to raise its contribution rate by up to 52 percent for the government share and up to 36 percent for members effective July 1, 2006.

At the same time, the program aims to reduce the four-tier enrollment categories to three—single, couple, and family—and to delete “high option” and “low option” subcategories.

The programs, however, proposes to retain the high option’s 80/20 contribution ratio—80 percent for the government and 20 percent for the member.

The low option is a 70/30 sharing.

SINGLE MEMBERS

Based on the proposed rates, a single enrollee’s semi-monthly or bi-weekly premium rate would increase by 1 percent for retirees and 36 percent for active members.

The government’s rate would be up 16 percent for retirees and active members.

The proposal said that the government’s contribution would increase from $12.67 to $14.68 for retirees and from $11.70 to $13.55 for active members.

A single retiree’s contribution would rise from $40.85 to $41.32 while a single active member’s pay would be from $37.71 to $51.45.

COUPLE MEMBERS

Couple members’ rate would be up 13 percent for retirees and 33 percent for active members, while the government’s rate would be up 16 percent.

Data showed that a couple’s payment would increase from $73.93 to $83.45 for retirees and from $68.24 to $90.49 for active.

The government would pay $26.55 from the current $22.93 for retirees and $24.51 from the current $21.17 for active members.

Couple refers to a subscriber with one dependent—a spouse or eligible child.

FAMILY

Family enrollees’ premium would increase to $139.52 from $107 for retirees and $133.40 from $98.76 for active.

The government would pay $50.48 from $32.21 for retirees and $46.60 from $30.66 for active enrollees.

Family refers to a subscriber with two or more dependents.

These proposed changes in rates are part of the proposed amendments to the rules and regulations governing the group health insurance program that was submitted by the NMI Retirement Fund on April 12 for public notice.

The proposal has not been published yet. Once published, the public has 30 days to comment on the proposal.

In an interview yesterday, Fund administrator Karl T. Reyes said that the rates increase is due to the overall rise in health costs.

“The cost is going up. We have not raised the rates for so long. Further, we are not collecting enough. So we don’t have enough money to pay the charges. The rates we are charging right now are not enough to pay the charges being billed us,” said Reyes.

The existing rates have been in place since 2003.

The Retirement Fund recently chose Aetna as its new third party administrator for the group health insurance program, replacing Hawaii Pacific Medical Referral, whose contract ends on June 30.

Aetna would have a three-year contract with the Fund to administer the group health insurance program beginning July 1.

The Fund has also chosen Pharmacare to provide prescription drugs benefit management services in July.