Thursday, March 31, 2011

Faculty Health Insurance - Questions, Answers and Comments

Choosing a health insurance plan is an important decision. For the first time, UNI faculty are being asked to make an informed choice between different health insurance options. You are invited to review the information posted on UF site about PPO's and HMO's.

Recently, you received an email message from UNI’s administration outlining their recommendations for faculty on this issue. We encourage all faculty to review those materials carefully at

This message supplements that information from the perspective of those who negotiated with the administration during the current contract cycle. It is important to note that the new PPO (Preferred Provider Organization) plan was the one that the administration wanted ALL faculty to have. This plan would save the administration about $500,000 each year in two ways:

1. a decrease in what is charged by the providers, and

2. an increase in out of pocket max and larger deductibles. With that in mind, we feel obligated to respond to some of the “answers” provided on the Human Resources website.

The answer to Q3 (“Will I have to pay more for my health coverage?” ) does not clearly note that if you choose the PPO, and if you get sick, you will pay more. It is true that if you do not get sick and have little or no need for health care in a given year, you would spend a little less under the PPO. However, if you became ill, or had need of significant prescriptions or needed to be in the hospital, your costs for the year would be about $2500 more under the PPO than the current plan (to use the family plan as an example). Depending on your pharmacy needs, total costs could even be much more than this. The bottom line is that if you switch to the PPO plan to take advantage of lower short-term costs, you cannot change back if you later have significant health care expenses.

In the answer to Q4 (“What are some of the benefit differences between the UNI PPO plan and the UNI Health plan?”) the administration says that “Members pay a flat copayment for prescriptions at the pharmacy” This is technically true, but it might not convey that the rate varies by type of medicine with a copay range of $10 to $50 depending on the medicine prescribed. Here is a link for checking the cost of different prescription medicines Welllmark information about the tiers. Click on Wellmark Drug List. Note that if faculty have 9 prescriptions for this 4th tier drug, they would be better off with the current plan, because under the current plan this $500 would be included under the “out of pocket max” (“Out of pocket max” is the limit on what a faculty can pay all year for health costs beyond premiums). Significantly, the out of pocket max for the PPO is $3000 for the family plan compared to only $500 under the current plan. Pharmacy costs are not part of the out of pocket max in the new plan.

The answer to Q7 “ What is the best health insurance plan?” contains a link to a health insurance calculator. We agree that faculty should take each plan into consideration, that health circumstances vary, and make an informed choice. However, it looks like the calculator does not factor in the difference in how prescriptions are calculated – which is potentially a significant difference. Under the current plan, pharmaceuticals are part of the $500 out of pocket maximum. Under the plan offered, they are NOT (there is no maximum for pharmacy spending under the new plans). If you try and use this calculator to do a comparison, keep in mind that if you were to need a significant amount of prescriptions, this will increase the total cost (amount you have to spend) for the PPO option; and this is not figured in the calculator.

Finally, Q13 deserves comment. “I have single health coverage, will I now have to pay a premium for my coverage?” Single faculty will pay more in premiums if they stay in the current plan but will continue to pay no premiums if they move. We think it reasonable that all faculty pay something for their health care, but in terms of strict personal cost analysis: if you are a single person who is very healthy and not concerned about paying an extra $1000 more should you become ill, you might want to save the slight difference in premiums.

UF welcomes an exchange of views on this important issue within the Blog. The views may or may not represent the opinions of UF leadership. The actual cost of premiums will not be known with certainty until about April 30.

All current faculty will have the option of keeping the current Health plan that faculty have enjoyed. Unfortunately, new faculty will not be allowed to choose the current health care option. For me, I am confident I understand the different options available and the advantages and disadvantages. Our family will be staying the traditional UNI faculty plan.

Blog away!


  1. It is also important for families to note, moreover, that UNI will only contribute *80%* of their contributions toward the PPO monthly premiums toward the UNI Health premiums, if you opt to stay in the current program. Since we don't know yet what the PPO monthly premiums will be, this could result in a considerable hike in the monthly premiums for families (they will almost certainly go up as a result of this change, but how much is not yet known).

  2. Thanks to UF for this information and for setting up this blog. I take an expensive prescription drug right now, so will be staying on the current plan.

  3. The new rates for the year have been announced.

  4. After checking the rates, it is significant that the monthly premiums for UNI Health for families remains about the same for the coming year. Even the raise in rates for individuals for the UNI Health plan is not an unreasonable amount. Clearly, the PPO and Blue Advantage options would offer more savings to the University than it does to faculty themselves. The out-of-pocket maximum is significantly greater for the PPO than for UNI Health, as noted above. Considering that the savings for a family for the PPO monthly premiums over the current health plan is only $75/month ($900/year), the difference does not make up for the MUCH greater out-of-pocket costs over time. Not everything spent on medical care contributes to the out-of-pocket expenses, either: prescriptions for the PPO plan do not factor into it. I have a very healthy family in general, but this past year we ran into some unexpected expenses. Had I been on the PPO plan, it would have been an enormous financial burden. Under the current plan, however, the costs were manageable, and the plan itself is an excellent one. I never had to fear, even when I was traveling alone or with my family, that health care costs would not be covered or that a health emergency might become a financial burden. I will keep my family on the current UNI Health plan, because even in an average year health-expense-wise, it is worth the few extra dollars for my family's health and my own peace of mind. Investigate all the factors for each plan before making a decision... the monthly premium savings for the new plans may not offer, ultimately, any savings in the long run for you or your family. Thanks to UF for their hard work on our behalf.

  5. I agree with the above comment. Although I might be able to save a few dollars this year by signing up for the PPO, I am going to stay put. Plus, does anyone have any idea what the premiums for the PPO will be in five years? The premiums over the past five years have been very reasonable. I bet the PPO will cost a whole lot more in a few years than it does this year. Maybe the administration is subsidizing the PPO just to get more of us to sign up, only to raise the premiums over time.