Browse through our comprehensive list of frequently asked questions
How does a self-insurance arrangement save money?
Educational institutions with fully insured health insurance arrangements for their employees are leaving money on the table, according to Steven Keshner, Senior Vice President and Chief Actuary with Spring Consulting Group. Moving from a fully insured to a self-insured model creates the lowest possible margin for health plan administration. “By moving from a fully insured to self-insured arrangement, you retain any profits and gain claims transparency so you can bend the cost curve,” said Steven, who leads edHEALTH’s actuarial consulting team.
The pandemic has shined a light on the importance of shifting to self-insured arrangements as insurers report record profits due to dramatic drops in healthcare utilization while self-insured purchasers realize lower healthcare spending. A recent Employee Benefit News article authored by the President of MagnaCare concurs: “Self-insured plan arrangements are the best way to plan strategically for the long term, and the current environment is underscoring the need to transition.”
Self-insured arrangements are not without risk and stop-loss provides security. “edHEALTH schools pick their own stop-loss self-insured retention level based on their risk tolerance, philosophy, financial status, and experience,” said Steven. “The member schools own the health insurance stop-loss program, enjoy pooled rates, and share in any profit margins when the results are favorable.”
Nick Frongillo, Associate Actuary with Spring Consulting Group, points to three savings opportunities through edHEALTH:
- Retaining stop-loss profits
- Collaborating with other member schools on plan design and finding data-driven solutions that save money, such as carving out prescription drugs
- Negotiating low administrative fees through the purchasing power of 25 colleges, universities, and other schools
Spring’s actuarial team works with current and prospective member schools and their brokers to model a variety of options, and make sure everyone is comfortable with the corresponding financial projections. “We work together with member schools – current and future – and their brokers to develop rates for a variety of options and plan designs, and explain these projections,” said Nick. “We also explain cash flow logistics and the structure of the captive.” Sometimes a fully insured carrier will come back with an attractive rate for a prospective member school to compete with the low quote they’ve received from edHEALTH. “edHEALTH is a long-term solution, and we offer advice to prospective educational institutions on how they will save money over time,” said Nick. “We collaborate with the broker so we can give them the information they need while providing a seamless and positive experience for the current or prospective member school.”
In addition to conducting pricing analyses, Steven’s team generates financial projections, actuarial reserve certifications, actuarial and reporting analytics, makes sure claims are paid correctly with funds available to make those payments, and assures reserves and other actuarial financial statement items are adequate. “We strive to make sure that the member owners and their brokers are comfortable with all the financial pieces,” said Steven. “Transparency is key, and we open up the black box to show every detail on premium spending.”
“I can’t say enough about Steven and his team’s responsiveness, accuracy, and collaboration with our board, member owners and their brokers,” said A. Tracy Hassett, edHEALTH’s president and CEO. “I liken their financial accuracy to landing a 747 on a postage stamp.”
Steven Keshner began working with what became edHEALTH in 2009, when the Boston Consortium for Higher Education, which brings together Boston area colleges and universities to develop and implement cost saving and quality improvement ideas, gathered a group of chief financial and chief HR officers to find out how to slow health insurance cost increases. He and other members of the Spring Consulting team recommended the captive solution to the advisory committee, helping to launch edHEALTH in 2013 and grow it since then. He has over 25 years of actuarial, financial, underwriting, and strategic insurance experience with a group life, health, and pension focus, and has worked for Spring for over 11 years. Prior to joining Spring, Steven was the Senior Vice President, CFO and Chief Actuary of Nippon Life Benefits in New York, a subsidiary of Nippon Life Insurance Company, a global mutual life insurer.
Nick Frongillo has worked with edHEALTH since he joined Spring Consulting six years ago. He develops working rates for medical claims, stop-loss premiums, and third-party administrator administrative fees. In his position, he provides a variety of actuarial functions including pricing, reserving, valuations, business development, financial projections, underwriting and financial analysis. He is the primary actuarial point of contact for current and prospective member owners and their brokers.
What's the risk of joining a captive and why should you consider it?
You may hear the word “captive” and get nervous. What is it and what’s the risk? Not only are captives not scary, they also provide added value to a go-it-alone self-insured healthcare program according to John Burke, Boston College’s Financial Vice President and Treasurer. A captive is an insurance company that is owned and controlled by its members to insure the risks of its member owners. “As a captive owner, you have input in the direction of the captive including plan design, which is critically important during these challenging times,” says John Burke.
Boston College implemented a self-insured employee health insurance program in June of 2009. “Making the transition to a self-insured program can be nerve-wracking for any large or small entity,” said John. “However, the benefits of moving to a self-insured program more than outweigh an entity’s concern.” Although the school was happy with its self-insurance program and that they were no longer paying profits to administrators on top of claims, it wasn’t satisfied with the stop-loss rates it was receiving from carriers.
In the early years of its self-insurance program, because of actuarially determined potential insurance claims, Boston College experienced double-digit increases in its stop-loss insurance rates. If BC experienced a better-than-predicted claim trend, it didn’t receive rebates on its stop-loss outlay. If the claims experience was worse, stop-loss rates would rise. “The inequities in the commercial stop-loss insurance market were the driving force for Boston College to become a founding member of edHEALTH,” said John.
Since joining edHEALTH in 2013, Boston College has experienced lower healthcare premium increases than it had under its own self-insured (and before that insured) program. “Our improved cost trends are mainly due to the purchasing power of the coalition,” said John. Lyndsay King, Boston College Controller, who has overseen forecasting and accounting for the school since the switch to self-insured in 2009 and then to edHEALTH in 2013, says, “While our claims experience has fluctuated over time, the move to edHEALTH has yielded clear savings in stop-loss premiums, administrative fees, and prescription drug costs."
Under a self-insured program, a school pays actual claims for the institution’s faculty, staff, and covered family members. In good years, the school pays less, and in the not-so-good years, the school pays more. The captive structure, including external stop-loss, pooled risk, and individual member funding (self-insured retention) provides customized risk protection. Each member chooses their own self-insured retention rate based on their risk tolerance, philosophy, financial status, and experience. edHEALTH works with each member institution to determine their risk tolerance and provides protection to minimize it.
“Due to our large size, Boston College picked a risk retention amount of $250K, meaning we are responsible for the first $250,000 of each individual claim,” said John. Smaller schools generally pick lower thresholds. edHEALTH and its excess stop-loss carrier covers any costs that exceed the retention amount. “As an educational institution assumes more risk through its retention amount, they have a lower stop-loss premium,” said John. “Conversely, if a school lowers its retention amount, it will pay higher stop-loss premiums. I sleep better with the stop-loss limit we selected.”
Boston College’s John Burke said the school can build up its subscriber surplus dollars in good years due to the ownership structure of the captive. Alternatively, in more challenging years, the school can use those funds to offset losses due to less than favorable results, although they haven’t had to do so. When you own your own insurance company, you’re able to smooth your claims experience over time, according to edHEALTH’s president and CEO, Tracy Hassett. “In our over seven years in business, only three of our 23 members have ever experienced a year with a loss, and they were able to use their own edHEALTH funds instead of dipping into institutional funds to cover those losses,” she said.
Captive member owners may have the opportunity to share in any surplus the captive earns. To date, edHEALTH has awarded dividends of over $3.2 million to its member schools. “I am happy to talk to any colleges, universities, or secondary schools that have questions about joining edHEALTH,” said Boston College’s John Burke. Send us an email for his contact details.
How does the Educators Health Exchange captive work?
edHEALTH’s Tracy Hassett explains how the edHEALTH captive provides a healthcare solution that benefits higher education and secondary school institutions, their faculty and staff, and tuition-paying students and families in this Vermont Captive Insurance-produced video.
Twenty-five colleges, universities, and secondary educational institutions own Educators Health, LLC (edHEALTH), a healthcare collaborative formed to address rising healthcare costs that were straining school budgets. By bypassing commercial insurers and pooling resources, edHEALTH leverages the combined schools’ purchasing power, thereby saving on healthcare costs for faculty, staff, and family members. But, did you know that edHEALTH’s wholly-owned subsidiary, Educators Health Insurance Exchange, is a group captive insurer?
The captive insurance company’s main purpose is to insure its own risk. By joining colleges and universities together as a single purchaser, the schools gain market leverage. The captive manages its own risk through claims management, innovative programs aimed at loss control, and collaboration with strong business partners.
Here are the ABCs on how the Educators Health Exchange captive works:
A – Advantages Include Variety of Savings Opportunities and Flexible Plan Designs
- Potential short and long-term cost savings – the larger group means better pricing and less volatility. The group purchasing power provides low negotiated Third Party Administrator (TPA) fees, transparent broker payments, and reduced Affordable Care Act (ACA) taxes.
- Risk financing options – member schools pick their own self-insured retention level based on their risk tolerance, philosophy, financial status, and experience.
- Improved cash flow – every year, each member school gets to keep the amount in their claims account if the school’s claims are less than the amount paid into the account. Unlike fully insured plans, schools aren’t paying profits on top of claims; it’s their money to use for future claims. Additionally, if the captive has a surplus at the end of the year, each member school receives an allocation based on the school’s and captive as a whole’s experience.
- Customized employee benefit designs – unlike other group funding options, our captive arrangement offers flexible plan design options. This allows edHEALTH to offer a variety of plan design options to meet the needs of our members.
B – Business Partners add Strength to the Organization
edHEALTH and its captive couldn’t operate without the benefit of its relationship with strong business partners. Each business partner provides unique expertise that benefits member schools, the edHEALTH organization and its captive:
- Third Party Administrators – negotiate contracts with providers, process claims in compliance with edHEALTH plan designs, and offer top-notch customer service to member school employees and their family members.
- Captive Manager – manages the day-to-day functions of Educators Health Exchange, serves as the primary contact with regulators, ensures compliance with regulations, provides insurance and risk management know-how, and produces financial statements and reports.
- Actuary and Underwriting Consultant – through analytics, the actuaries manage the financial security of the captive. Underwriters evaluate each member school’s risk profile, plan designs, and risk tolerance to develop the working rates.
- Auditor – monitors loss reserves, reserves adequacy, and reviews the actuary’s assumptions and calculations.
- Attorney – makes sure that the captive satisfies all IRS requirements, and advises edHEALTH on how to respond to any audits and enforcement actions.
- Investment Advisor – provides expertise on investment strategies and timing of investments that align with claims cash needs.
- Re-insurer – limits the potential loss to edHEALTH and our member schools from high-claimants
C – Collaboration among Member Schools
One of the most popular aspects of being part of the edHEALTH Captive is collaboration. Member schools meet frequently as part of the Plan Design and Comptroller groups. They compare cost utilization, trends, and best practices. That rapport leads to sharing ideas at meetings and outside of scheduled events.
The icing on the cake is the annual edHEALTH Walking Challenge gets the competitive spirit in high gear. Clark University took home the prize in 2021. Who will win the 2022 edHEALTH Walking Challenge Trophy? Stay tuned.
How do edHEALTH's captive risk financing options work?
Under edHEALTH’s captive, member organizations pick their own self-insured retention level based on their risk tolerance, philosophy, financial status, and experience. In addition to the stop-loss coverage schools automatically receive, they can purchase aggregate stop-loss coverage to further protect their risk. Here’s how the risk financing works:
If a school picks a Self-Insured Retention (SIR) of $100,000 per claim:
- The college will pay any single claim up to $100,000.
- The Educators Health Insurance Exchange captive will pay the next $1-$900,000 for each individual claim from this school.
- edHEALTH purchases excess protection from a stop-loss insurer. This insurer reimburses edHEALTH for any part of a particular claim that exceeds $750,000.
Members work with the actuaries to pick a Self-Insured Retention amount that balances their claims experience with the risk of paying claims and stop-loss insurance. Final rates reflect the level of risk a school wants to take and its claims experience.
Do you have an educational institution case study?
Salve Regina University Realizes Strong Results and Valuable HR Support
With compensation and benefits comprising 60% of Salve Regina University’s budget, Vice President for Administration and Chief Financial Officer, William Hall is always evaluating ways to keep costs in check while continuing to attract and retain top-notch faculty and staff. In the late 1990s he moved the health insurance benefits from an insured to a self-insured program where the university takes the responsibility for paying medical claims plus stop-loss to protect against high-cost claims. This approach creates the lowest possible administrative costs and means that the employer isn’t paying profits on top of claims. This was a bold move, especially at the time, as some small colleges and universities worry about the higher risk of a self-insured arrangement.
“We were already self-insured and had been pleased with that decision,” said Mr. Hall. “However, healthcare costs were still having a negative impact on Salve Regina’s bottom line, so we were seeking a solution to the rising cost conundrum.” Salve Regina University became aware of edHEALTH through the Boston Consortium, which fosters collaboration between higher education institutions. The school had a positive experience with the organization’s Risk Management Group, and began to explore how banding together with other higher education institutions might make sense for their healthcare program.
A disruption analysis found that by moving to edHEALTH, Salve Regina would:
- Save money on faculty and staff healthcare costs;
- Pose minimal benefit design disruptions; and
- Maintain employees’ access to their doctors and hospitals.
Salve Regina University joined edHEALTH effective January 1, 2016. The corresponding results have been outstanding.
- 18% reduction in administrative rates
- 5% decrease in stop-loss rates
- Savings enabled university to provide one month of free employee healthcare premiums
- Four-year cumulative healthcare rate increase of 10.8%, markedly better than the industry average of 31.1%
“The money Salve Regina has saved on healthcare costs through edHEALTH has been greatly beneficial to our bottom line,” said Mr. Hall. “Through the edHEALTH model, we work directly with plan administrators to offer attractive benefits, a broad provider network, and comprehensive coverage to our faculty and staff.”
Employee Satisfaction and Valuable HR Support
Employees have been satisfied with their benefits, and the HR staff has welcomed the collaboration benefits of edHEALTH. “Overall, our employees are happy with their healthcare plan design options,” Claudia Cavallaro, Associate Director for HR and Benefits. “It’s a pleasure to work with the entire edHEALTH staff who are knowledgeable, friendly and responsive!” Upon the onset of the COVID-19 crisis, edHEALTH implemented frequent virtual meetings to help schools share ideas and learn from one another. “Sharing information and best practices to navigate during these uncertain times has been especially valuable,” said Nancy Escher, Director of Human Resources.
Why is edHEALTH's captive domiciled in Vermont?
Inquiring minds want to know: Why is edHEALTH’s stop-loss subsidiary, Educators Health Insurance Exchange, based in Vermont? David White, Vice President for American International Group’s (AIG’s) U.S. Captive Management Services, filled us in. “Vermont was one of the first states in the nation to establish captive-enabling legislation, and as a result, the regulators have deep expertise in the industry,” he said. “Vermont state employees are helpful to the captive industry, offering support, guidance, and a quick turnaround.”
Vermont’s responsive and business-friendly philosophy helps promote a captive insurer’s agility. “When a captive wants to make a material change to its business plan, state regulators and captive managers work together to get it done,” said David. New lines of business, changes in investment policy, increased stop-loss limits, and service provider changes all require regulatory approval. edHEALTH’s Captive Subscribers Advisory Committee decided to assume more risk a couple of years ago, and AIG, edHEALTH’s Captive Manager, worked with the Vermont regulators to facilitate that change. “The Vermont Captive Insurance Association (VCIA) recently appointed Tracy Hassett (edHEALTH’s president) to its Board, and that’s beneficial to edHEALTH’s business needs as her active involvement increases edHEALTH’s visibility to the Vermont regulators,” said David.
David White is a Certified Public Accountant and an Associate in Captive Insurance. He joined AIG in 2001, having become familiar with the captive industry when he audited captive insurers at his previous KPMG position. The AIG staff of over 20 professionals provides day to day management services to over 100 captive clients, including edHEALTH.
“I am proud of the day to day accounting and reporting services that my fellow AIG employees, Joe Percy and Abigail Donze, provide to the edHEALTH organizations,” said David. “Their reporting has been accurate and on time which helps keep us compliant and running smoothly.” In 2017, AIG also assumed financial accounting services for our parent company, edHEALTH LLC. For both entities AIG prepares quarterly financial statements and annually coordinates with outside independent auditors to make sure the financials are correct. Their staff also participate in board meetings, issue monthly invoicing, and because the captive is regulated, completes compliance reporting for the state of Vermont.
“David White has been an important asset to our school members/owners and the Board,” said edHEALTH president, Tracy Hassett. “He and his team helped us launch the captive, and have been true partners in helping us manage the organization.”
“edHEALTH is one of my favorite clients because it is a nonprofit that helps higher education institutions reduce their faculty and staff health insurance costs, improves schools’ bottom lines, and promotes employee health,” said David. “edHEALTH approaches challenges creatively, such as their frequent all-member virtual meetings during the pandemic; population health initiative for high-risk patients; and popular Walking Challenge. Its smart and strategic approach to bending the healthcare cost curve and promoting member school collaboration provides a real service to the higher education industry.”
Why would a go-it-alone self-insured educational institution want to consider edHEALTH?
Self-insurance wasn’t a novel approach for Wentworth Institute of Technology’s employee health insurance program. They self-funded the program over twenty years ago, well before it became common practice. “Wentworth had been self-insured for many years before joining edHEALTH,” said Wentworth’s Vice President of Finance and CFO, Bob Totino. “This arrangement saves the school from paying profits on top of claims to the health insurance administrators."
On average, compensation and benefits make up 60% of higher education budgets and fiscal departments are keen to find new solutions for reining in costs. "Wentworth Institute of Technology discovered edHEALTH through our participation in The New England Educators Insurance Association (NEEIA), a group of seven private higher educational institutions that collaborated to improve the cost, availability, and service of workers compensation and other employee insurance benefits," said Bob. The school and 21 other colleges and universities provided seed money to create a group purchasing coalition — Educators Health (edHEALTH) — to tackle rising healthcare costs.
When Wentworth became a member-owner of edHEALTH, it had 328 subscribers, which was a small risk pool. Joining edHEALTH helped the school leverage a bigger group’s purchasing power. "Moving from our own self-insured arrangement to the edHEALTH self-insured arrangement provided economies of scale on administrative and stop-loss costs," said Bob.
“By being part of a collaborative, Wentworth reduced its fixed costs, which account for approximately 10% of overall healthcare spending,” said Sue Shillue, President of Cook & Company Insurance Services, Inc., Wentworth’s advisor. “edHEALTH also negotiated a strong prescription drug carve-out contract, which has generated additional savings.”
Wentworth has enjoyed only one rate increase since joining edHEALTH in 2014. “The claims are the claims, but Wentworth’s administrative costs have decreased dramatically since becoming a member of edHEALTH,” said Sue. “When we were evaluating the edHEALTH option for Wentworth, it was clear that joining was in the best interest of our client.”
How does HR's role change when an educational institution joins edHEALTH?
Time – it often seems like there’s not enough of it to get everything we want to do completed. College and university Human Resources departments are especially stretched thin with pandemic-related responsibilities and crises. One area where they don’t have additional worries and tasks is their edHEALTH employee healthcare program. “The amount of work HR departments do when enrolling in – or once they’ve joined – edHEALTH doesn’t increase,” said Cindy Bartelson, edHEALTH’s Operations Manager. “Instead, it’s just different as we assume administrative and troubleshooting tasks and they take on a more strategic role.”
edHEALTH helps employees troubleshoot any issues they may have with a plan administrator, which frees HR staff to take on more interesting work. HR staff can also take part in edHEALTH procurements and wellness initiatives. Each school’s HR team decides their level of involvement and how proactive a role they’d like to take.
Plan Design Involvement
Monthly Plan Design Committee meetings include claim trend projections, industry and program updates, and plan design discussions. “edHEALTH coordinates plan design meetings where we collaborate with our advisor and other member institutions on policy and program initiatives,” said Sharon Woodward, Director of Human Resources for Olin College of Engineering. “These meetings keep us up-to-date on the changing healthcare benefit landscape.”
Thought Leadership Opportunities
Our quarterly Thought Leadership Seminars keep HR staff updated on the latest issues, trends, and best practices in employee healthcare benefits. “edHEALTH provides several forums to keep us updated on what's going on in the industry,” said Jessica Szymczak Roy, Benefits Manager for Regis College “These updates help us get the information we need so we can plan strategically with our advisor.”
Ease of Implementation
When a school joins edHEALTH, we do the heavy lifting to make it easy on HR departments. edHEALTH staff works with the educational institution staff, their advisor, and the plan administrators to help ensure a seamless transition.
“We run disruption reports to identify any employees who could be impacted by the switch to edHEALTH,” said Cindy Bartelson. “In general, we don’t see provider disruptions and there sometimes are prescription drug tier changes. We send customized communications to any affected employees and open enrollment communications templates to the HR staff to make it easy to communicate with their employees about the change.”
Collaboration and Team Spirit Advantages
Member institution HR staff report high satisfaction with the multiple collaboration opportunities and becoming a more valuable resource for their institution. “The multiple edHEALTH strategic venues have allowed us to learn about best practices at other institutions and to share our approach during this unprecedented time,” said Marymichele Delaney, Chief Human Resources Officer at College of the Holy Cross.
"One of our favorite events of the year is the edHEALTH Walking Challenge where our faculty and staff compete against other member schools,” said Olin College’s Sharon Woodward. “edHEALTH takes care of the administrative aspects of putting this together and our college only needs to encourage employees to participate." Stay tuned for information on the fourth edHEALTH Walk This Way Walking Challenge.
How do advisors collaborate with the edHEALTH team to identify solutions for their clients?
Savings Drive Consultant Recommendations to edHEALTH
The primary reason a health insurance consultant recommends edHEALTH to their higher and secondary education clients is when the pricing estimates support the change. Healthcare puts a huge strain on college, university, and private secondary school budgets, which drives up tuition costs. “Higher education is struggling with drops in enrollment and controlling costs is critical,” said Ben Lewis, Partner, Strategic Healthcare Practice Leader, Consiliarium Group, LLC. “Employee compensation and benefit costs represent the lion’s share of college budgets.”
Through our purchasing clout, edHEALTH can negotiate lower administrative fees with less healthcare cost volatility than schools can generally realize on their own. The seven-year average health insurance premium increase is 2.9%, well below the industry average of 7.9%. “Self-funding is a long-term solution and being part of the edHEALTH coalition provides stop-loss economies of scale that small- and medium-sized schools aren’t able to achieve on their own,” said Dave Montville, Managing Consultant, Employee Health & Benefits, Marsh & McLennan Agency.
edHEALTH’s pharmacy carve-out has saved member institutions an estimated $50M-$60M between 2017 and 2020. “The captive provides purchasing power for stop-loss coverage, and the prescription drug carve-out program has provided significant savings for our clients,” said Karen Bacon, Assistant Vice President, Corporate Benefits, NFP.
Captive member owners may also share in any surplus the captive earns. To date, edHEALTH has awarded over $3.2 million in dividends to its member schools. “edHEALTH’s model where all the savings generated by the captive are returned to member schools is unique and a valuable benefit for our clients,” said Tim Tracy, Managing Director, Risk Strategies.
Brokers Become Advisors When Client Joins edHEALTH
With a self-insured health plan, a school’s broker becomes an advisor. The school pays the advisor on a fee-for-service basis instead of on a commission that’s built into the health insurance carrier’s rates. This arrangement improves pricing transparency as the school pays the advisor directly for their advice and representation. “Our role as an advisor becomes more strategic when a client joins edHEALTH,” said Ben Lewis of the Consiliarium Group.
edHEALTH provides several collaboration opportunities that increase advisors’ visibility and knowledge while enhancing their strategic role. “As an advisor to an edHEALTH school, we show our value separate from edHEALTH,” said Chris Powers, Senior Vice President, Risk Strategies. “Advisors drive strategy for their clients. It’s helpful to have insight into what other member schools are looking to do.”
Collaboration Forums Provide Valuable Insight
edHEALTH has an active Plan Design Committee made up of representatives from each member institution and their advisors who work with the Third-Party Administrators (TPAs) to determine plan designs customized to meet the needs of edHEALTH members. These and other all-member forums enable educational institutions and their advisors to compare cost utilization, trends, and best practices with other member schools.
“We have a very collaborative partnership with the edHEALTH staff and their medical consultant,” said Dave Montville of Marsh & McLennan. “They are responsive and dedicated to our client’s needs, such as modeling different alternatives.”
“The participation in plan design meetings is strong, and member school advisor perspectives are openly sought,” said Charlie Baldelli, Principal, Brown & Brown Insurance. “The collaboration with other schools is valuable for our clients. For example, there’s been a lot of discussion on how different institutions are handling paid family and medical leave regulations.”
Streamlined Processes and Strategic Tools Help HR Staff and Their Advisors
When a school becomes a member-owner, edHEALTH staff works with the educational institution staff, their advisor, and the plan administrators to help ensure a seamless transition. Advisors and their clients work with edHEALTH staff and its consultant to determine the best suite of plan design options. “The consolidated plan design options make it easier to make selections for our clients,” said Karen Bacon of NFP.
The implementation team uses disruption reports to identify any affected employees by the change so customized communications can go out to those faculty and staff, if applicable. edHEALTH also provides open enrollment communications templates to make it easy to communicate with new member school employees. “The implementation process for our clients has run very smooth, and the edHEALTH team and its consultant are very responsive to client needs, said Sheena Tracy, Managing Director, Risk Strategies. “Implementation is a team process with our organization, our clients, the edHEALTH team and their consultant.”
Health insurance works when member educational institutions and their advisors have the data they need to make informed decisions. “Moving to edHEALTH improves medical and prescription drug cost transparency for us and our clients,” said Sean Carney, Partner, 360 Corporate Benefit Advisors. “The data mining helps us create strategies to bend the cost curve.” Ben Lewis of the Consiliarium Group concurred. “edHEALTH’s population health management program emphasizes data mining and early identification of high-cost claims, which allows us to be proactive.”
The People Make Meetings More Fun
There’s no shortage of business to attend to and collective expertise at edHEALTH meetings, but the collegial atmosphere makes them – dare we say it? – enjoyable. “Tracy Hassett (edHEALTH’s president and CEO) is effective at building relationships and making people feel heard,” said Teri Weber, Senior Vice President, Spring Consulting Group. “Being part of a group is at the heart of a captive, and the membership provides a collegial atmosphere,” said Dave Montville of Marsh & McLennan. “It’s a great group of people to work with,” said Sheena Tracy of Risk Strategies. “Everyone is enthusiastic, collaborative, and well-versed.”
Do edHEALTH PPO members have access to in-network providers nationwide?
Did you know that all member school faculty and staff have access to in-network healthcare providers regardless of where they live? Employees enrolled in any of edHEALTH’s PPO options can visit network doctors, hospitals, and other healthcare providers throughout the United States. This benefit is particularly helpful as higher education institutions modify their work-from-home and residency policies.
Increase in Out-of-Area Employees
The burst in work-from-home arrangements during the pandemic has changed where and how people work – perhaps permanently. PwC’s March 2021 Pulse Survey found that almost a quarter of employees are considering or planning to move more than 50 miles away from the office; this is on top of the 12% of employees who have already made such a move since the start of the pandemic. Additionally, remote work arrangements allow schools to hire staff from further away.
Schools with National Health Plan Administrators
Outside of New England, edHEALTH has access to over 60 carrier-owned and provider-sponsored networks. All of these include national network options, including Aetna, Cigna, and several Blue Cross Blue Shield networks. Using a customized approach, we determine which network best meets the needs of a new member institution. We evaluate various options for network panel scope, how the network and types of care align with the institution’s utilization patterns, and for financial value. These findings are provided to the new member school and their advisor for final network determination. Employees can find participating providers through the plan’s customer service department, website, or by logging into their account.
Schools with New England Health Plan Administrators
edHEALTH schools with Harvard Pilgrim Health Care and Tufts Health Plan have robust network options within New England. Outside of New England, Harvard Pilgrim Health Care uses UnitedHealthcare’s national provider network. Tufts Health Plan uses Cigna’s national provider network. Employees are enrolled in either the Cigna Out-of-Area PPO plan (outside of Massachusetts, Rhode Island, and New Hampshire) or the CareLink plan (outside of Massachusetts and Rhode Island). This information is on the employee’s ID card. To find a participating provider, employees can:
- Call the plan’s customer service department
- Log into their account online or via the plan’s app and use the provider search feature
- Check the “PPO” box on Harvard Pilgrim Health Care’s website or the “Carelink Plan” or “Cigna PPO Plan” on the Tufts Health Plan website and then search for a provider.
On October 26, 2021, Point32Health, the combined Harvard Pilgrim Health Care and Tufts Health Plan organization, selected UnitedHealthcare as its national networkprovider effective January 1, 2023. This will give Tufts Health Plan members access to 20% more nationwide medical and behavioral health provider options. Until this takes effect, members will continue to use the current nationwide Cigna network. For 2024,Tufts Health Plan members will receive a new ID card reflecting the new national network. There are no foreseeable changes for Harvard Pilgrim Health Care members as the result of the UnitedHealthcare national network selection.
Employees Show Their Plan Administrator ID Card
When visiting a doctor or hospital, the employee shows their edHEALTH health carrier ID card, which gives the provider the information they need for billing the plan administrator.
How does the Clinical Intervention Program work?
According to a recent report from PricewaterhouseCoopers' Health Research Institute, medical costs will increase on average 6.5% in 2022. The report cites pandemic-related drivers for the jump: deferred care, exacerbated opioid and mental health crises, and an increase in unhealthy habits. Rising provider prices and market clout, skyrocketing prescription drug costs, and new expensive gene therapies will also push up rates.
Controlling healthcare and prescription drug costs are critical for sustaining effective, affordable healthcare benefits. In 2018, to support these goals edHEALTH introduced KnovaSolutions®, a comprehensive clinical decision support service that focuses on those who need the most help. The savings are compelling - the program saves $3.39 for every $1.00 spent. edHEALTH provides this resource to member schools at no cost.
Nineteen of our 25 educational institutions are taking advantage of this program. More than 340 employees and covered family members dealing with complex medical conditions are enrolled. These patients get the resources they need to feel better so they can go back to the things they love to do.
Twelve hours per day, participants can get answers to their medical concerns:
- Help me understand my diagnosis, treatments, tests, and/or medications.
- How can I make lifestyle changes?
- Please review and help me understand my medications, how to take them, and whether I should be concerned about adverse interactions or side effects
- How can I better balance work and life to support my loved one who’s ill?
The program ensures privacy while using predictive modeling to identify those in need of support early in their care journey. It’s effective due to a caring, coordinated, and comprehensive approach with a team reflecting 5 disciplines:
- Master of Science-degree nurses - are the main point of contact. They use a person-centric approach to conduct a comprehensive assessment, determine patient goals, develop a care plan, and enlist other team members as needed.
- Pharmacists – help members understand their prescription drug medications, ensure adherence, identify potential concerns, and give recommended cost-saving options.
- Certified diabetes specialist – supports patients with diabetes, provide ongoing education, and help patients navigate decisions and symptoms.
- Research librarians – discuss and send patients evidenced-based research about conditions, anticipated procedures, treatment options, risks, and benefits. They also find potential clinical research trials.
- Registered Dietician – the newest team member helps patients with a chronic disease and/or recently diagnosed condition with diet and lifestyle changes.
Enrolling in the program is easy. Member schools contact edHEALTH’s Cindy Bartelson to schedule a 30-minute kickoff call. KnovaSolutions provides the school with a suggested email to send faculty and staff. From there, KnovaSolutions does the rest, making it easy for school staff while protecting employee confidentiality.
What are the steps to find out whether edHEALTH will save your school money?
There’s new urgency in finding ways to cut spending at higher education institutions and secondary schools. Compensation and benefits generally comprise at least 60% of a school’s budget; finding ways to reduce employee health insurance costs is an effective strategy for containing costs without sacrificing the quality of your benefits package.
edHEALTH’s group purchasing power can generate significant savings on three key components of your employee healthcare benefit costs:
- Stop-loss coverage
- Administrative fees
- Prescription drug benefits
“If schools want to evaluate the potential savings they will realize by joining edHEALTH on January 1, we encourage them to start the process in June,” said Nancy McConaghy, edHEALTH’s Business Development Executive. “This helps ensure a seamless experience for the school, its faculty, and staff.”
If your school is not on a January 1 plan year, edHEALTH will work with you on a transition process. “edHEALTH understands that no two schools are alike and we work with each school to customize an approach that works for the individual school,” said Tracy Hassett, edHEALTH’s president and CEO. “The school’s HR staff, advisor, and edHEALTH will work together on a short plan year to transition rates, deductibles, coinsurance, and other benefits to January 1.”
There are three steps for evaluating the edHEALTH option for January 1. Joining at another time of year impacts the timing but not the steps:
1) Call Nancy McConaghy 1.866.692.7473 ext. 702
Call Nancy to start the process. If you have questions, would like a presentation, or are looking to speak with other member schools, she can help. She will start with a disruption analysis to identify whether and how employees will be affected and to identify network options with the best fit locally and nationally, if applicable. The disruption analysis turnaround is 10 business days.
2) Let Us Know You’re Ready to Proceed with the Rate Quote Process
Once we receive your authorization and census, plan and claims information, we will proceed with a working rate quote. We will also discuss plan design. “There’s flexibility on plan design and we work with each school and their advisor to determine the best match for your population,” said Nancy. “We and our business partners will turn around the working rates with itemized stop-loss, medical, prescription drug, and administrative rate components no later than August 15.”
3) Join edHEALTH
After you receive the working rates, you and your advisor will have some time to make changes including plan design adjustments. Our actuarial consultant will get you the final rates by September 15. “This deadline is important to allow time for implementation, employee communication, and open enrollment, and provides a seamless experience for the school and its employees,” said Nancy.