ARE THERE OTHER COSTS? IS THIS OPTION BENEFICIAL FOR GIC MUNICIPAL HEALTH ALL MUNICIPALITIES? Municipalities pay for their costs of Although this option can save money for many INSURANCE OPTION evaluating and implementing the GIC option, municipalities and their employees and retirees, plus an administrative fee to the Commission, it may not be the right choice for all. For which may not exceed 1% of premium; this example, some municipalities have joined joint amount is only used to administer the purchasing arrangements that have helped to program. The GIC does not use brokers and keep health care costs in check. Also, the GIC there are no broker fees, commissions or reinsurance/stop loss costs. option only applies to health insurance. Municipalities that join continue to provide Q LOW PREMIUMS other benefits, such as life, dental, vision, or HOW DO WE PROCEED? disability income insurance. Q COMPREHENSIVE OPTIONS If it makes financial sense for your community to look into the GIC option, your For additional information, see the Municipal unionized municipality must adopt Section 19 of Chapter 32B, Coalition Bargaining, to Resources section of the GIC’s website Q RATE INCREASES LOWER bring together a Public Employee Committee www.mass.gov/gic than most municipalities (PEC), made up of representatives of Group Insurance Commission employees and retirees. The decision to join .O. P Box 8747 have realized on their own the GIC would be made collectively between Boston, MA 02114-8747 municipal leaders and the PEC. These 617-727-2310 negotiations will include: TDD/TTY: 617-227-5181 Q Whether or not to join the GIC Q If joining the GIC, the contribution ratio to be paid by the employees/ retirees and the municipality by plan type Q Provisions for opting out of the GIC after three or six years Q Additional provisions for Retired Municipal Teachers if they currently participate in the GIC’s RMT program. For comprehensive information on this topic, including information for non-unionized municipalities, refer to the Chapter 67 Questions and Answers, available on the GIC’s website. Also visit the Metropolitan Area Planning Council’s website: www.mapc.org WHY CONSIDER THE GIC HEALTH INSURANCE OPTION? HOW DO WE EVALUATE THIS OPTION? Municipal health insurance costs continue One way to get an estimated total current year Complete the same calculation for each to grow at unsustainable rates, resulting in a cost of insuring your town’s employees and GIC health plan and coverage type and add all negative impact on municipal governments, retirees through the GIC, is to do the following results together. employees, retirees, and taxpayers. With flat calculations: Third, compare the amount you calculated or reduced municipal revenues, cities and First, estimate which GIC health plan your to your municipality’s health care expenses towns are looking for relief from these employees and retirees would select, for the current year. increases in an effort to attract and retain factoring in the health plans in which they qualified employees while maintaining To estimate future savings, compare the are currently enrolled, contribution splits GIC’s premium trends applied to the GIC cost services. and whether the GIC offers a plan by your estimate you just calculated with the rate current carrier(s). increases your municipality experienced over The Group Insurance Commission (GIC) provides health insurance and other benefits Second, take the number of enrollees the last few years applied to your municipality’s to more than 300,000 state employees, estimated to enroll in each health plan by current health care expenses. retirees, their dependents and survivors. The coverage type (individual, family or You also will need to compare and contrast GIC’s buying power and expertise has Medicare) and multiply by twelve times the the GIC’s health benefits with your current full cost premium of that coverage for each plan options. The GIC’s premium trends and resulted in: GIC plan multiplied by the municipal current health plan benefits are on our website, Q Lower premiums than most [ [ contribution. mass.gov/gic municipalities can negotiate on their own [ Current year full cost GIC premium rates are in Q Comprehensive health plan options [ the municipal resource section of our website Q Indemnity (Non-Medicare and Medicare options), which are available throughout the country Q Statewide PPO-type options (employees and Non-Medicare retirees/survivors), which are also (www.mass.gov/gic): Example: # of GIC Plan A individual enrollees [ x [12} x GIC full cost monthly premium for GIC Plan A [ x % Municipal contribution for this type of available in other New England individual coverage plan (e.g., HMO) states Q Regional HMOs (Medicare and BACKGROUND ON THE LAW Non-Medicare) Q Rate increases lower than most Leaders of municipal organizations, public Area Planning Council (MAPC) and chaired by employee unions, retired municipal employee John Hamill, former Chairman of Sovereign municipalities have realized on their own organizations, state legislators, and GIC senior Bank of New England. The group drafted the staff began meeting in September 2005 to find final legislation that carefully balanced the solutions to rising municipal health insurance priorities and concerns of all participants. This costs. This Municipal Health Insurance legislation allows municipalities to join the Working Group was staffed by the Metropolitan GIC’s health coverage.
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