Board Communique: July 16, 2020
Extended health group benefits are improving January 1, 2021
Many retired members participate in the Municipal Pension Plan’s (plan’s) extended health and dental group benefits. Because we know these benefits are so important to many, the Municipal Pension Board of Trustees (board) regularly reviews the program. For the most recent review, the board did a comprehensive review of these group benefits over the past year and a half.
As a result, we’re pleased to report that your extended health care benefits will improve, effective January 1, 2021. The changes are:
- Increasing vision coverage to $250 every two years and including eye exams for all with extended health care coverage.
- Restructuring paramedical reimbursement to $500 annually per service type per person. Previously, some of the service types were combined.
- Adding coverage for the shingles vaccine.
- Standardizing coverage of dispensing fees for maintenance medications to five fills per year. This aligns with the industry best practice of 90-day prescription fills. For members on blister packaging, 13 fees per year will be standard.
- Using targeted case management and prior authorization for high-dose opioids to ensure safe and effective use of medications.
- Amending coverage of medical supplies to align with industry standards.
How did the board decide on changes?
We needed a comprehensive picture of how the program is working for members in order to understand the opportunities for change. To help us with that big picture, we hired ZLC Financial and Cubic Health as our professional health benefit advisors. This part of the review included many technical aspects, including analyzing claims data and other plan analytics, benchmarking against similar plans, studying the group benefits contracts, assessing funding status and projections, reviewing administrative expenses and premiums, and educating ourselves as a board about group benefit issues and trends.
We also asked members to share their experiences with the program through an engagement survey that was open in October and November of 2019. We thank the more than 4,000 members (retired and active within five years of retirement) who participated. We considered your feedback on important aspects of the plan as we deliberated. Your input will also help inform how the board manages post-retirement group benefits in the future.
With all of this data in place, ZLC Financial brought a final report and recommendation to the board for its decision.
Your experience with Pacific Blue Cross and the dental plan
As part of the engagement survey, we asked about your experience with Pacific Blue Cross and the dental program.
There was a strong sense of satisfaction with the carrier and the dental benefits. Because the dental plan is fully insured, costs for any benefit improvements would be passed on to members as premiums. The board did not believe the options for modest improvements would provide enough value for the cost, so it is not making any changes to the dental program.
Prescription drug costs: an opportunity for savings
Those who participated in the survey told us that it was important for members to know they can save money on prescriptions by using a low-cost pharmacy. If more plan members would choose a low-cost pharmacy, the potential savings could be substantial to members and to the plan.
What you pay for prescription drugs depends on where you fill your prescription. Depending on which pharmacy you choose, you may pay more or less for the ingredient costs, the pharmacy markup and the dispensing fee.
Pacific Blue Cross has a preferred pharmacy network with pharmacies that have the lowest dispensing fees. Pharmacies include Costco, London Drugs, Save-On-Foods and Thrifty Foods.
One of the most cost-effective choices is Costco Pharmacy, which does not require a membership and offers free home delivery.
What will the changes mean for me?
Benefit improvements will become available January 1, 2021. If you are enrolled in the extended health plan, you do not need to take any action to receive the improved benefits.
Extended health premiums will not change as a result of these improvements, but premium rates may be adjusted as part of the annual review and rate adjustment effective February 1. See the Retirement health coverage premiums page for rates. Premium rates will also be included in the winter issue of Pension Life newsletter, which you will receive in January.