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How Premium Rates for Port-sponsored Medical Plans are Set

According to the Kaiser Foundation, nation-wide premium rates are rising by an average of 3% in 2018. Here at the Port, however, premium share rates for the High Deductible Health Plan (HDHP) and the Deductible Plan administered by Aetna are increasing by only 1.4%, while the rate increase for the Kaiser Permanente Core Plan is only slightly above average at 4%. We attribute these trends to thoughtful use of healthcare services by employees and their families, as well as employees’ active engagement in the Port’s Spirit and Wellness Program.

The HDHP and Deductible Plan are self-insured plans. This means that the money you contribute by payroll deduction and the amount the Port contributes on behalf of each enrolled member is used to pay for incurred claims. This money is deposited into a Port bank account. Each week, Aetna will total up the claims they have paid and they send an invoice to the Port. The Port then makes payment from its bank account. The manner in which enrolled members use healthcare services directly impacts the rates you pay.

The Kaiser Permanente Core plan is a fully-insured plan. This means that Kaiser Permanente determines a monthly premium amount that is paid by both employees and the Port. The collected premiums are paid to Kaiser Permanent each month, and Kaiser Permanente uses this money to manage care and receives no more or less until the next contract period when premiums can be adjusted. The relatively low premium increase for subscribers who earned their 2017 Wellness Reward demonstrates restrained use of healthcare dollars by covered members.