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April 17, 2014

Open enrollment runs April 23-May 14

Health insurance here will see a 3.5 percent rise in premium costs next year but no change in plan copayments, deductibles or co-insurance.

John Kozar, assistant vice chancellor for Human Resources, says other changes include a 15 percent increase in vision premiums, a fresh opportunity to elect additional life insurance, a new web-based physician consultation service and the chance to roll over $500 in health-care flexible spending account funds from year to year.

Open enrollment this year will run April 23-May 14.

Also just announced was a sharp rise in the cost of long-term care insurance of 88 percent across three years, although such insurance may be elected outside of the open enrollment period.

Medical benefits

sidebarFor Pitt’s HMO Panther Gold, chosen by 90 percent of faculty and staff, the increase means monthly rates are going up $2 per individual for single coverage and $10 for family coverage. The four preferred provider organization (PPO) health plans will have similar monthly increases, Kozar says.

The letter from Human Resource’s Benefits office announcing the open enrollment period, which will be sent to employees the week of April 17, blames the rise on “medical inflation, which consists of the anticipated increases in the cost of services plus increased utilization, [which] is expected to be above 8 percent.”

Thus, Kozar calls the 3.5 percent increase in premiums “a win. Our goal each year is to have that increase come in as low as possible. Some years you have to adjust copayments to reduce the amount of increase,” he adds, as was the case last year. This year, “what you pay at the doctor remains the same — and that’s for all the doctor’s services.”

Panther Gold also is adding a yearly out-of-pocket maximum for the first time ($1,800 for individuals and $3,600 for families) as mandated by the Affordable Care Act. This is “a positive,” Kozar says, potentially helping those with the greatest medical expenses.

The top PPO, Panther Advocate, is seeing its deductible reduced to the level of the Panther Premier Plan — from $750 to $500 for individuals and from $1,500 to $1,000 for families using in-network services.

Pitt’s UPMC Health Plan holders now will be able to see doctors online via the web-based UPMC AnywhereCare. It will be accessible starting July 1 on and will offer consultations through instant messaging or video appointments (the only option if the patient is a child ages 3-18). A new brochure for the service pledges “a response with a diagnosis and treatment plan, usually within 30 minutes” and prescriptions sent directly to your pharmacy. The copay for this service under Panther Gold will be $10; with a PPO, it will be $38 if you have not yet met your deductible, at which point it will be $3.80.

Pitt staff and faculty also can download UPMC’s free mobile app, which is not entirely new, but “we wanted to make sure it was up and running and really functional” before making it widely available, Kozar says. It allows users to access their UPMC Health Plan member ID card, contact their physicians and other health-care providers from a personal list, check a claim status, view their health-care flexible spending account balance and access Assist America, UPMC’s link to health-care services for those traveling more than 100 miles from home.

“It’s just pushing the technology a little further,” he says. “There will be more and more things coming down the pike.”

Dental, vision, life insurance and flexible spending accounts

Pitt dental benefits remain unchanged, because the University is in the middle of a two-year contract, but the cost of vision benefits will rise 15 percent at the beginning of a new four-year contract.

For Davis Vision’s Fashion Excellence Plan, that means a 90-cent increase for individuals per month and $2.21 for families. For the Designer Gold plan, there will be increases of $1.26 for individuals and $3.09 for families each month. The frame allowance at Visionworks outlets will increase $50 and there now is a copayment of $140 for a newly available Ultra Progressive lens.

“The rates are low — it’s a phenomenal deal, I think,” Kozar says. About 9,000 Pitt employees elect dental coverage and another 9,000 have purchased vision coverage.

Those who previously opted out of the optional life insurance equal to one year’s salary now can opt back in for this Aetna policy without providing evidence of insurability — as long as they have not been turned down for this benefit previously.

“It’s sort of a door opener,” Kozar says. “You can get in with no questions asked.”

For the 3,300 Pitt employees who have health-care flexible spending accounts, the federal government for the first time is allowing a rollover of up to $500 from one year to the next, starting July 1, 2014. It replaces the two-and-a-half-month extension to make claims, but participants still will have until Sept. 15, 2014, to submit claims incurred up to June 30, 2014. Kozar expects the use of this flexible spending account to increase, since some were frightened away previously by the yearly use-it-or-lose-it policy.


The most dramatic benefit change comes for the 860 staff and faculty with long-term care insurance through Unum. On March 28, Kozar sent a letter to participants announcing Unum rate increases of 25 percent on July 1, 2014, 25 percent on July 1, 2015, and 20 percent on July 1, 2016, compounding to about an 88 percent increase in premiums across those three years.

Long-term care insurance may be elected at any time, and each staff member has a slightly different premium based on the age at election, the type of plan and whether a spouse also is covered. Kozar says the University has known “for quite some time that the rates are increasing,” not just for the University but for many of Unum’s clients.

“It’s a significant increase but not one that was done lightly,” he says. “The driver behind the increase is really that the premiums they [long-term care insurance companies] receive don’t generate the income to offset claims that are incurred.”

Unum will be sending out a package to every participating faculty and staff member, offering three options for future coverage. Current participants may keep their current plan and pay the rate increase, change their plan in an attempt to lower their premium cost or drop their plan by electing the contingent non-forfeiture benefit within 120 days of the July 1 rate increase. In the last option, Unum will give those participants the choice of picking “the greater of one month of their monthly benefit or the total premium paid on the policy since the coverage was issued,” according to Kozar’s letter — “so you won’t lose what you paid into it,” he adds.

“Most carriers have left the business and there aren’t a lot of options for group coverage,” he says, when asked about the possibility of Pitt changing carriers. He has the benefit himself, he says, and believes it makes sense to keep it; if needed, the payout on this insurance can quickly bypass the cost of the premiums — even premiums paid over decades.


Reaction to health plan changes

The heads of the University Senate and Staff Association Council (SAC) were appreciative of the University’s efforts at negotiating the 2014-15 benefit rates but they still had some concerns.

“They’ve done a reasonable job of keeping the costs in line,” said Senate President Michael Spring about the 3.5 percent hike in health-care insurance premiums.

“The one issue we continue to have is that some costs are fixed,” which has a greater impact on the salaries of more junior faculty and staff. “This has been an ongoing kind of concern for several years,” Spring said. “The administrators I’ve talked to have been very empathetic to this. It’s just not easy to find a solution.

“In this case,” he added, “I think it’s a small enough increase that it’s not going to be much of a concern for everyone.”

Rich Colwell, president of SAC, issued a statement that the group “values the University administration’s efforts in negotiating” the benefits changes for next year, but “we do not support the proposed 3.5 percent increase in monthly health plan costs the staff will be requested to contribute.”

The reason, Colwell writes, is due to the continuing effects of last year’s benefits changes and low salary hikes: “While we are pleased that there is not a proposed increase in copayments, the staff is still adjusting to absorbing the large copayment increase that occurred last year in conjunction with increases in hospitalization costs, cost of living and minimal salary raises (1-3 percent). The University of Pittsburgh staff continues to perform their jobs with utmost professionalism while experiencing the financial burden such increases bring to their personal and professional lives.”

—Marty Levine