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Under 65 contribution increase

In FY11, the city expects to spend more than $300 million for health care, up from $289 million last fiscal year. Even with modifications to plan copayments and taking advantage of state statutes that allow the city to save tax on premiums paid to BCBSTX, HMO premium rates are going up 5 percent, and PPO rates are going up 12 percent. To keep the same top-notch benefits employees, retirees and dependents enjoy, the city and plan members must share the increased costs.

Plan utilization shows that medical claims costs are 65 percent higher on average for retirees under age 65 than for active employees and retirees covered by Medicare. Utilization records consistently demonstrate that retirees under age 65 have a higher need for medical services during the first few years after they retire than when they were active or become covered under Medicare. To help cover that higher cost, retirees under age 65 will begin to absorb more of the total premium cost for medical insurance.

Beginning May 1, the under-age-65 retiree group will pay a higher portion of the insurance premium necessary to fund their health care. Instead of contributing 36 percent of the premium, under-65 retirees will contribute 48 percent, and the city will contribute 52 percent. This contribution ratio helps to keep the plan affordable, and the cost is less than what retired employees under age 65 are paying at many other companies that still offer retiree health benefits.

This shift in contribution strategy will put the city in a much better position to offer medical coverage to retirees for years to come. And, when you turn 65, your Medicare coverage will help reduce your cost for HMO or PPO, and it puts you in line to benefit from the city-sponsored Medicare plans that offer tremendous cost savings for coverage comparable to that in the HMO and PPO.

Monthly Medicare plan contributions
All rates are per member
Aetna PFFS $70.98
Aetna PPO $54.84
KelseyCare Advantage HMO $3.50
KelseyCare Advantage POS $17.24
Medicare supplement plan F with prescription drug plan* $91.74
Texas HealthSpring $26.24
TexanPlus HMO $32.00

*Excludes disabled members under age 65

 

Monthly HMO and PPO plan contributions for retirees age 65 and over
  HMO PPO
From To From To
Retiree only
Without Medicare
 $492.54
 $522.14
 $817.07
 $923.52
With Medicare $153.64 $163.82 $507.90 $600.20
Retiree + 1
Without Medicare $1,034.34
$1,096.50
$1,732.80
$1,958.58
1 with Medicare $307.36 $327.74 $1,090.70 $1,232.82
2 with Medicare $299.64 $319.50 $714.10 $807.14
Retiree + 2
Without Medicare
$1,773.16
$1,879.74
$2,156.80
$2,437.82
1 with Medicare $522.48 $557.12 $1,435.48 $1,682.04
2 with Medicare $476.38 $507.96 $1,298.41 $1,523.72
Monthly HMO and PPO plan contributions for retirees under age 65
Retiree only $171.82
$256.38
$580.58
$730.40
Retiree + 1 $507.04 $756.60 $1,492.57 $1,899.48
Retiree + 2 $790.72 $1,179.90 $2,086.75 $2,682.90

Above BCBSTX rates reflect wellness discount. Tobacco users ad $25.

 

 

 

  
 
 
 
 
 

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If there exists a conflict between this Enrollment Guide Website and the official plan documents for each plan, the official plan documents will prevail. The city of Houston reserves the right to change, modify, increase or terminate any benefits.