Health Insurance Exchange Can Learn from Beaverton School District

According to Debbie Johnson, Beaverton’s health resource coordinator, the district offers every full-time employee a comprehensive benefit package from two carriers (two Regence BlueCross BlueShield plans and one Kaiser plan) for up to $1,094 per month. Except for one Regence plan that requires a $156.60 per month employee contribution, the district fully pays for the combined cost of medical, dental and vision premiums and insures the spouse and dependent children.

           

State law threatens the Beaverton School District. It could be forced to give up its plans and purchase healthcare benefits through the Oregon Educators Benefit Board (OEBB). Created in 2007, OEBB is a statewide insurance pool serving 150,000 employees and eligible retirees of Oregon’s school districts and educational service districts. Yet purchasing power has not yielded savings for some districts and many employees.

 

Should Beaverton employees have enrolled in an equivalent OEBB plan over the past two years, the district would have spent an additional $4.1 million in 2009 and another $7.9 million in 2010. With today’s budget constraints, the additional expense would have eliminated 46 teachers two years ago and an additional 43 teachers the following year.

 

It doesn’t take advanced math to understand that losing 89 teachers equals higher unemployment costs, less general fund revenues and larger classroom sizes. As a result, there are two Senate and four House bills that give districts to opt out of OEBB—including Senate Bill 332, sponsored by Senator Mark Hass and Representative Tobias Read, both of Beaverton.

 

Debbie Johnson distinguished how OEBB is different than a single payer healthcare system. She suggested a single payer system of healthcare would be “efficient and streamlined… without so many plans.”

 

Cost-sharing for the three district plans is transparent and affordable. Despite these generous plans, the carriers for the district have praised the district for appropriate utilization.

 

Denise Hall, deputy administrator for OEBB plan stated that enrollment and high utilization in a low co-pay plan led to 18-19 percent increased premiums in the first year, followed by a 26 percent increase last year. The numbers of enrollees in these plans decreased from 17,000 to 5,000. Last year ODS Health Plans attributed a $38 million loss to "continued cost increases caused by higher utilization of healthcare services.”

 

Kaiser Permanente plans are the lowest cost alternative and have increased the least, but are only offered in the Portland and Salem areas. Three out of four OEBB enrollees were enrolled in ODS Plans last year.

 

The backlash to double-digit increases for OEBB beneficiaries resulted in “value tiers” for ODS and Providence plans, effective October 2010. ODS offers seven plans—and six of these have three different pharmaceutical options. The ODS Treatment Cost Navigator can even “get an estimate of your costs and compare providers before your next office visit or procedure.” Brain freeze!

 

For lower-wage classified employees, a “consumer driven” choice may be determined by known out-of-pocket costs; and they begin with the employer contribution toward the premium and end with the lowest cost plan. But that won’t be so smart if out-of-pocket deductibles, co-pays and co-insurance skyrocket from the unforeseen sickness.

 

It’s great that these plans have no-cost preventive services, weight management and tobacco cessation programs. However, patients who fall out of testing guidelines aren’t covered. For example, if a doctor recommends a diagnostic colonoscopy for a 46 year-old female patient with rectal bleeding, that procedure would be subjected to out-of-pocket costs because a screening colonoscopy is not indicated for individuals who are younger than 50. If that same woman were also called back for an abnormal mammogram (not unusual for the pre-menopausal woman with dense breasts), she’d likely be subjected to the cost of a diagnostic procedure as well.

 

Chronic diseases (hypertension, diabetes, asthma, heart conditions and high cholesterol) have low co-pays in plans with incentive tiers. The diabetic who comes in with complications of disease from a cold would be covered. But worries about pneumonia would not be sufficient to have this diagnostic care covered at all.

 

The Beaverton School District employs a younger population than OEBB, and they consequently have a population that utilizes maternity services. In order to mitigate higher costs in this area, the district has worked closely with their employees and their two carriers to promote their pre-natal programs.

 

While a slightly older workforce in less-served areas may challenge OEBB’s negotiations, their response should not compromise personal health and finances through further out-of-pocket cost-shifting. OEBB's purchasing guidelines state, "Quality care means that care is consistent with evidence-based practice guidelines and individual clinical circumstances."

 

Signing up for most of their plans requires health speculation—and there’s no evidence that’s of value to the patient. Healthcare utilization should be defined by effectiveness, efficiency and appropriateness. If the Beaverton School District can keep costs down and pass them on to their employees and to the classroom, then OEBB should be able to do so with a larger number of employees.

 

It’s imperative we create solutions to expand access to care. With investments in telemedicine and health information technology, larger integrated health plans (such as Kaiser Permanente) could extend to rural areas throughout the state. Patient-centered primary care will be the hub into pre-existing specialist referral networks.

 

Taxpayers increasingly resent paying for public employee coverage that most private-sector workers don’t have anymore, whether unionized or not. This resentment is wasted emotional energy as Oregonians value universal access to affordable healthcare.

 

Value tiers continue to serve the income-haves and disease-have-nots. If the political winds for a single payer healthcare system aren’t blowing our way, Oregon's healthcare exchange should be created as a single transparent market with a few comprehensive plans similar to those offered to Beaverton School District employees.