What’s New for Open Enrollment 2022
Despite the tumultuous health care environment amid the ongoing COVID-19 pandemic, there is some good news in health plan offerings.
Premium increases are holding steady and there are many plans available in the Northern California marketing.
Below is summary of what you should know for the 2022 plan year open enrollment.
Rates and coverage
To start with, average rate increases across all of the plans we offer are in the 5% range, which is on par, if not slightly better than what’s been predicted for on the national scene. This is the fifth year in row of 5% increases.
That said, some group plans are seeing smaller increases, and a few are even seeing decreases in their rates going into next year.
Most carriers are holding their deductibles, copays, and benefits steady with few if any increases.
HSA with low deductible options
There is one interesting development on the health savings account front. HSAs allow an employee to set aside part of their paycheck into this account, which they can later use to pay for out-of-pocket health care expenses. The funds that go into the HSA are not taxed and neither are the funds that are later withdrawn to reimburse for health expenses.
Employees can keep these accounts for life, and they build in value as they can invest the funds in these accounts.
Typically, HSAs are tied to high-deductible health plans (bronze plans), which can carry deductibles of up to $6,000 or $7,000.
Now Kaiser Permanente is offering a Gold HSA Plan, which has a much lower deductible. There are two types of people whom this might appeal to:
- Those who know they will use their benefits and likely breach their deductible. This allows them to pay for those out-of-pocket expenses with tax-free funds and, once they hit their deductible, the coverage levels increase substantially.
- Those who are healthy but want the backstop of a higher-value plan and also to be able to keep saving for future health care expenses.
New narrow network plans
There are now narrow network plans available in the Northern California market. While the moniker “narrow network” may sound like it means a smaller slate of providers to choose from, and hence worse coverage, many of these arrangements are large insurers partnering with more prestigious medical groups like John Muir Health and the University of California, San Francisco Medical Center.
When insurers partner with one of these groups and funnel all the coverage through them, they can provide better care at a lower cost than other, more expansive plans.
Aetna is coming out with a joint venture with Sutter Medical Group for 2022 to offer a narrow network PPO plan with attractive premiums.
Healthnet and UHC have a partnership with Canopy, a network of high-end providers in the Bay Area with attractive premiums as well. Healthnet’s arrangement is a PPO and UHC’s is an HMO.
There are new carriers in the area. VMA in particular has expanded our network and carrier options so that your employees will have more plans to choose from. The more plans available to your employees, the better the chance each employee can find a policy that is right for them and their health situation.
The new carriers to VMA offerings are: Aetna and HealthNet. Which carrier network is best for your group depends upon the location in the Bay Area. Ask us if they are a good fit for your employees.
In addition, there is a new joint venture called Cigna + Oscar. Oscar is a new carrier that is focused on people who like to use technology to access their policies and coverage, and it has been growing nationally.
The Cigna + Oscar PPO program uses Oscar’s technology and it’s matched with Cigna’s network.
New level-funded plans
There are new plan designs that are becoming a bit more common and allow the employer and insurer to share some of the risk.
In these so-called “level-funded plans,” the employer will pay the insurance company a fixed premium every month and at the end of the year, and if the group’s claims come in lower than expected, the insurance company and the employer will split the surplus funds.
On the other hand, for employers whose group has more expensive claims than expected, the employer does not have to pay more to cover them as the insurer bears that risk. These plans are growing in popularity, but they are often not feasible for smaller employers as the cost-risk can be a burden.
One piece of good news on the pharmacy front is that more insurers are incentivizing covered individuals to go to preferred pharmacies by offering lower copays at those pharmacies.
They can still go to any pharmacy of their choosing, if they want, but they’ll pay higher copays.
A number of companies have changed dramatically due to the pandemic and temporary remote working arrangements having become permanent.
As a result, some have seen a number of staff move out of state. For some companies, a majority of their employees have left California, which can complicate their group health plans.
To have a California group health plan, you must have 51% eligible employees in the state. And if you have had too many employees leave the state, you may not meet some plans’ underwriting rules.
Some insurers have lightened up their rules and will allow some employers to have more employees outside the state. But in any case, you should talk to your broker if you now have staff working out of state so that we can find coverage that has networks where they live.
A final word
Open enrollment can be a hectic time and questions are always bound to come up. We hope that the above gives you some perspective on the changes we are seeing for the 2022 open enrollment season.
As a related side note, VMA members with insurance get free benefits administration software called Ease. This software is great for signing up your staff to your group health plan and allowing them to compare plans during open enrollment. It also has an enrollment progress dashboard that lets you e-mail employees about open enrollment and view a snapshot of enrollment progress for each employee directly.