|University of Minnesota Health Plan Task Force||January 14, 1998|
|Comparison of Health Insurance Purchasing Alternatives|
|Executive Summary||Introduction||Current Shortcomings||Trends||Alternative Models||Profiles||Retirees||Further Analysis||Summary|
|Appendices: 1, 2, 3, 4, 5, 6, 7, 8||Glossary|
The current health insurance purchasing strategy is being evaluated for its effectiveness in meeting the needs and goals of University faculty and staff. There are several alternatives to the current partnership that the University has with the State Employee Group Insurance Program, including maintaining the status quo. The Task Force on Health Insurance, in conjunction with the Faculty Consultative Committee and the Senate Committee on Faculty Affairs, can use this report and any subsequent actuarial analysis to determine which purchasing strategy would provide the best coverage at the lowest cost. The greatest freedom in benefit design is afforded by separating from SEGIP, but this freedom would probably only come at greater premium and administrative cost. The lowest cost strategy may be to join BHCAG with the State, but this strategy would reduce the University’s voice in decision-making.
The Task Force on Health Insurance may want to consider the risk and cost implications of its preferred alternative, as well as the way in which provider and carrier problems are resolved. The Appendices provide snapshots of premiums and benefits of employers using the different strategies for purchasing health insurance. These employers have managed their health benefits aggressively in response to consolidation in the Twin Cities health care market. Reliable cost estimates of moving to another purchasing strategy can only be generated by actuarial analyses that are beyond the scope of this report.
The needs of University faculty and staff have recently become of greater importance to State Employees Group Insurance Program, and the efforts of the Task Force on Health Insurance may be enough to motivate a change. However, the University is just one of many players in the local health care market. Improvements in benefit design and premiums will require a continued dialogue between the major carriers, the University of Minnesota Physicians, BHCAG, SEGIP, and representatives of University faculty and staff. An open discussion between these groups offers the best hope for a more efficient and effective health care market.
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