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How Premium Rates for Port-sponsored Medical Plans are Set

The rising cost of healthcare continues to be a hot-button issue nationwide. However, we are excited to report that for the second year in a row, premium share rates for the High Deductible Health Plan (HDHP) and the Deductible Plan administered by Cigna are not increasing!  The rates for the Group Health Plan with Wellness Reward are increasing by 3.15%; however, this is considerably lower than the national average. We attribute these trends to thoughtful use of health care 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, Cigna totals 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 Group Health plan is a fully-insured plan. This means that Group Health determines a monthly premium amount that is paid by both employees and the Port. The collected premiums are paid to Group Health each month, and Group Health 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 2016 Wellness Reward demonstrates restrained use of healthcare dollars by covered members.

The 2017 premiums for the Deductible Plan and Group Health Plan for employees who did not complete the Wellness Program and have elected family member coverage will be less than the 2016 premiums due to a new premium formula included in the federal Affordable Care Act.