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| Retirees Seek Greater Input On Insurance |
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JULY 2005 - Association Bills Target Reforms At GIC - A combination of rapidly rising health insurance costs and complicated benefit structures has led to a strong sense of frustration amongst many members, resulting in renewed calls to reform the state's Group Insurance Commission (GIC).
Over the past ten years, retirees and survivors, who are enrolled in a health plan through the GIC, have witnessed their annual out-of-pocket expenses sharply increase year after year. All the while, their benefits have been eroded. "It is bad enough to pay higher insurance premiums, but when you combine the high prices with a reduction in benefits then a disturbing pattern begins to emerge. This is exactly what has happened with the plans offered through the GIC," said the Association's Western Massachusetts Vice President Jack Walsh. "While price is always a concern, members understand that there is a cost of having a quality insurance plan. We want to ensure that the quality remains intact."
In 1995, retirees, who are insured through the GIC and eligible for Medicare, paid $26.56 (90/10) a month for coverage under the Optional Medicare Extension (OME) plan. Non-Medicare retirees paid $45.08 (Individual) and $102.99 (Family) for indemnity coverage. At the time, these rates reflected an overall 8.5% increase over 1994's rates. Over the same time period, members have also had to absorb large increases in prescription co-payments. At the same time, GIC officials have placed certain restrictions on benefits designed to control costs. Appeal Process Needed In recent months, an increasing number of retirees have issued complaints regarding the GIC's prescription drug policies. These policies are resulting in many members having to pay hundreds of dollars a month in out-of-pocket costs. One controversial change has been the implementation of a complicated three-tiered prescription copayment system, whereby various drugs are placed in categories. While the exact process used to categorize the drugs remains a mystery, it appears that the actual cost of the drugs is a deciding factor, with the more expensive drugs, referred to as non preferred brand names, being placed in tier 3 which has the highest co-pays. For example, retirees, seeking access to a tier 3 drug, are forced to pay $40 for retail and $70 for mail order. If their drug is in tier 1, they only pay $7 (retail) or $14 for mail order - a significant difference. Further hampering access to needed medications is an another program, called "Generics Preferred." This program requires retirees to pay an added enormous cost, namely the difference in cost between a generic drug and a non-preferred brand name. Legislation Pending Responding to our members' concerns, the Association has filed several bills aimed at reforming various aspects of the health care system in which public retirees are enrolled. Two bills specifically target and seek to reform certain policies of the state GIC. In order to address the issue raised by Elizabeth Beverage (See Member Profile, below), amongst many others, the Association has filed SB1435, which was filed by Senator Scott Brown (R-Wrentham). The bill requires the GIC to create an appeals process, whereby medical evidence can be presented to justify the use of a particular drug. "A similar appeal process exists under MassHealth. Why should retirees, who are paying good money for their insurance, be denied due process rights that are granted to those receiving free care," stated Association Legislative Liaison Shawn Duhamel. "Budgets should not be balanced on the backs of sick people. That is exactly what the GIC has done in this instance." Another bill (SB1629), offered by the Association and filed by Senator Marian Walsh (D-West Roxbury), would alter the composition of the eleven member commission that governs the GIC. Association officials feel that retirees must be given the opportunity to be heard by those responsible for crafting the state's insurance plans. Under current law, the governor appoints nine of the eleven commissioners to the GIC. The remaining two (secretary of Administration and Finance and the state's Insurance Commissioner) are ex officio members of the GIC, but are appointed to their official positions by the governor. While the statute does call for one state retiree to serve on the commission, that individual is appointed by and serves at the pleasure of the governor. "We feel strongly that the retiree representative on the GIC should be free to express their opinion and truly represent the interests of public retirees. Given the current setup, that is not possible," explains Association President Ralph White. "In the past, our representative has been removed from the GIC because she spoke out against the governor's proposals. "Far too much is at stake to allow the governor's appointees to be a rubber stamp for the agenda of any administration. Our members have earned their benefit, pay a high price for it, and deserve to be properly represented. We may not always like the final outcome, but at the very least retirees will know their voices were heard." SB1629 would replace the current retiree representative, appointed by the governor, with someone designated by the Association. In addition, the bill would also add a representative of the Mass. Teachers Association to the commission. Despite representing thousands of higher education employees, the MTA does not have a seat on the GIC, while the state's three largest unions each have a seat. |
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