If you’re a benefits-eligible employee who is planning to retire within the next few years you may be interested to learn about an exciting change, effective January 1, 2019, in the way that Middlebury provides healthcare (medical, dental and vision) access to our retirees.
Currently benefits-eligible Middlebury faculty and staff who retire* are offered the opportunity to remain in Middlebury’s health benefits, post-retirement, however to do so they must pay the full monthly medical, dental and/or vision premiums. Remaining on Middlebury’s health benefits as a retiree has its pros and cons:
- One the plus side:
- Retirees are familiar with our plan design, and
- Human Resources is here to help when questions or concerns arise.
- On the negative side:
- Our plan is very expensive compared to the cost of comparable plans that are specifically designed for retirees (this price differential is primarily because of federal subsidies available to specifically designed retiree plans as well as special drug pricing for which we are not eligible), and
- Retirees have only one option each for medical, dental and vision insurance which may or may not be a good fit for retirees and/or their dependents.
In fact, over time more and more of our retirees have realized that our one-size-fits-all approach does not fit all. For many years retirees have been complaining about the high cost of our benefits and asking for more cost effective alternatives, which, unfortunately we were not able to provide. Eventually, three quarters of eligible retirees dropped out of our plans and instead opt to purchase coverage on the individual market, where there are many plan designs to choose from, and at lower costs.
While those retirees who have gone out on their own were satisfied with the coverage and price options available, we are well aware that venturing out to comparison shop for health insurance on one’s own feels like a daunting ordeal to many, and so about a quarter of our retirees haven’t done so.
What, you may be wondering, has prevented Middlebury from coming up with a suitable solution for our Medicare-eligible (65+) retirees in the past? In a nutshell, many factors, including: the relatively small size of our retiree population (only a few hundred), the self-insured style of our group plan (which works great for a large, active employee population, but not as well for a small retiree population), a geographically dispersed group (a good number live here in VT, but others are spread out over the country), a tendency for our retirees to travel abroad, and an expectation for a high-touch level of personal customer service (such as retirees currently receive from Human Resources), etc. have made viable alternatives elusive.
At Last – A Solution!
We are very pleased to announce that, at long last, we have found a solution that we believe will meet the coverage design, choice, cost and customer service needs of our Medicare-aged retirees! Effective January 1, 2019 Middlebury will replace our self-insured retiree group benefits for retirees and dependents with coverage access through ViaBenefits, the comprehensive Medicare marketplace operated by Willis Towers Watson (WTW). We are confident that the enhanced value, flexibility, choice and personal support our current and future retirees will be receiving from WTW/ViaBenefits will be a great improvement over what we currently offer in-house.
WTW/ViaBenefits – Options and Expertise
WTW is a leading global company, with roots going back to 1828, that helps clients around the world with benefits and other advisory and brokering needs. WTW’s ViaBenefits division is focused exclusively on helping retirees obtain coverage that is designed to work in conjunction with Medicare. ViaBenefits services can be roughly categorized in two parts: insurer vetting/management and retiree customer service. ViaBenefits thoroughly vets national and regional insurance companies that provide Medigap, Medicare Advantage, Medicare Part D as well as dental and vision plans. Every insurer they contract with has been thoroughly scrutinized on, among other factors: plan design, geographical coverage, provider networks, drug formulary, customer satisfaction and price. Nationwide ViaBenefits has relationships with over 100 leading insurance providers including: BCBS, MVP, CIGNA, United Healthcare, and AARP.
WTW/ViaBenefits – Personalized Service
ViaBenefits believes that providing customized, personal service to retirees is just as important as managing insurers. They have a dedicated group of licensed and certified Benefits Advisors (BAs) who are experts not only on Medicare supplemental policies but also have extensive training on working with their exclusively retiree customer population. The BAs servicing our account will have been specifically certified to speak with the Middlebury retiree population. BAs are “carrier agnostic”, in other words there is no incentive for them to guide a retiree towards one product over another – instead their mission is to: educate retirees on the various types of available coverage, seek to understand each retiree’s (and dependent’s) healthcare needs and preferences, help the retiree choose the coverage that best meets his/her needs, and then remain available to support retirees on an on-going basis. Advisors spend, on average, 90 minutes on initial one-in-one phone calls with retirees to make sure they gain a full understanding of needs before jumping to recommending plan options. They look broadly at each individual situation – does the retiree have high prescription utilization? Does he/she travel frequently, or spend winters in another state? Is keeping the same health care provider important? Is the retiree looking for a plan similar to Middlebury’s or open to a different type of plan design? And remember, support from a Benefits Advisor won’t end once a retiree has enrolled in a plan – throughout the year an Advisor will be available to assist with questions related to retiree coverage, much as Human Resources staff currently do.
The number and variety of plans – as well as the costs – will vary state to state, but as an example in Vermont there are currently 5 Medicare Advantage options, 17 Medigap and 16 Plan D options to choose from – ALL of which are less expensive than Middlebury’s current retiree plan!
Human Resources is currently in the process of notifying and supporting current retirees as we make this transition to ViaBenfits on January 1st. There will be lots of communication and outreach, and we’re arranging for a team from Willis Towers Watson to come on-site to VT (with remote access for those who are outside of the area) for a presentation this fall. The presentation will be geared specifically toward current retirees, however we will have a few seats available for active employees who are planning to retiree within the next year or so. Please let us know if you would like to be added to the invitation list.
While this article specifically addresses benefits for retirees who are over the age of 65 and who are currently paying full premiums for medical, dental and vision insurance, I will add a brief update on a couple of related topics: early retirees and the “free period” of retiree coverage.
Early retirees – those who retire before age 65 – will not qualify for WTW ViaBenefits services until they reach Medicare age. Although we have a substantial number of early retirees very, very few full-pay early retirees have joined our plan since the implementation of the state insurance exchanges several years ago. The state exchanges provided such an attractive alternative that, on average, over the past several years we have had only one early retiree paying full price remaining on our group plan. (Options and pricing vary by state but generally there are numerous options available, at different price points, and many states offer subsidies to lower-income residents, making this a very attractive option.)
Sick Leave Reserve/Faculty Leave Reserve Conversion
Finally, employees may recall that under our so-called SLR Conversion benefit staff who have unused Sick Leave Reserve (SLR) and Faculty with unused Faculty Leave Reserve (FLR) at time of retirement are entitled to a period of Middlebury-paid retiree medical and/or dental coverage. Given that beginning next January retirees will no longer be on our group health plans we will not be able to provide the benefit in the same way as we currently do, so the method of providing the benefit has been reimagined. Starting in 2019 when employees with SLR or FLR retire Human Resources will set-up a special account, called a Health Reimbursement Account, in the new retiree’s name. The account will be funded with an amount calculated under the new SLR/FLR formula and then the retiree will be able to access that funds in that account to pay premiums for whatever insurance plan s/he has selected (through ViaBenefits, COBRA, a state exchange, or (where allowed under state law) private insurance).
Please don’t hesitate to reach out if you have questions or would like to learn more about this exciting new offering! I can be reached at 802-443-5465, or by email at email@example.com.
*To qualify as a Middlebury retiree an employee must have worked for at least 10 years – in a benefits-eligible position – past the age of 45.