Tuesday, October 01, 2013

Post-Obamacare, GCI's premiums top U.S. averages

Gannett's new health insurance premiums are sharply higher than average prices across the nation for similar plans this year, before the Obamcare reform law took effect, according to data in the authoritative Kaiser Family Foundation annual insurance survey.

GCI will charge a $90 monthly premium for its employee-only benefit next year. That's nearly 50% higher than the national average of $61 other companies are charging this year, the Kaiser data show.

For family plans, GCI will charge $575 a month vs. the $270 national average this year -- a price more than twice as high.

To be sure, there's a big caveat in directly comparing the GCI and Kaiser data. The company's figures are for the new high-deductible employee plan starting Jan. 1, while the Kaiser data are for 2013 high-deductible plans, and are based on a survey of 2,067 firms done from January to May.

Indeed, when Kaiser reports figures in next year's survey, they may be much closer to the company's new premiums and deductibles if other major healthcare companies raise their rates, too.

Company shifts blame
GCI has principally blamed the Affordable Care Act -- commonly called Obamacare -- for the company's decision to switch to a plan that's more costly for employees. But the company hasn't offered any hard evidence to back up its assertion, suggesting it might be trying to achieve a long-sought goal of shifting more costs to employees without accepting much responsibility.

Comparing the GCI and Kaiser data offers at least a snapshot of where prices have been, and where they're now heading across the company -- and, possibly, other large employers. I'm unaware of any other survey as comprehensive as Kaiser's. The non-profit published its 2013 report on Aug. 20.

Although GCI's premiums next year are higher, its deductibles compare more favorably with those in the Kaiser report. The employee-only deductible next year will be $1,500 vs. the $2,098 national average this year. For family plans, Gannett's deductible will be $3,000 vs. the $4,037 U.S. average this year.

For this post, I compared Kaiser figures for plans like the one Gannett is switching to starting Jan. 1: high-deductible plans with health savings account options. The company announced its new plan a week ago for nearly 31,000 employees and thousands more of retirees. It's one of the biggest medical plan overhauls in the company's history.

Obamacare moves into higher gear today, when government "exchanges" go live, allowing consumers to shop for new health insurance plans that are often less expensive vs. the private market -- as much as 84% cheaper in my case. The reform law is meant to bring better medical care to about 45 million Americans who don't have insurance. All new plans go into effect Jan. 1.

More high-deductibles
GCI is joining a growing number of other big employers switching to high-deducible plans in a bid to better control costs. Last year, the company spent more than $100 million on medical care. Employees paid just about 40% of that, and Gannett picked up the rest. This year, however, that ratio will be closer to 50%-50%, according to one of my readers.

The new plan requires employees to pay hundreds and even thousands of dollars of their doctor and pharmacy bills out of their own pocket to first satisfy the deductibles before the plan's coverage starts. However, GCI will pay a portion of the deductibles for employees earning less than $70,000 annually who open health savings accounts.

But even with those small subsidies, the company's lowest-paid employees will be hurt more than ever. That's because the new plan charges the same premiums regardless of how much employees get paid -- a big change from the current insurance plan.

CEO Gracia Martore, who last year earned $2.5 million in salary and bonus alone, would pay the same premium for family coverage as her lowest-paid employees -- assuming she even pays for her own health insurance.

About 23% of all firms offer these kinds of high-deductible plans. But they're much more popular among bigger employers, those like GCI with 1,000 or more employees. Some 43% of firms that size offer such plans, according to Kaiser.

Earlier: GCI's new plan is "a pay cut, sure and simple."

Related: Here's the full 236-page Kaiser report. Details about high-deductible plans with health savings accounts are in Section 8. Plus: This is Gannett's FAQ on its new plan, plus a document offering examples of how the plan will work.

21 comments:

  1. Wow. I read the lede and was about to congratulate you for doing some great service journalism, and then I got to the fourth paragraph.

    "The company's figures are for the new high-deductible employee plan starting Jan. 1, while the Kaiser data are for 2013 high-deductible plans."

    You compared everyone else's PRE-OBAMACARE data to Gannett's POST-OBAMACARE plans? And then buried that fact after the fireball assertions? Kind of a big difference there, don't you think?

    That's irresponsible journalism at its best.

    And don't give us that, "Well, that was all the data I had" excuse. If you can't compare data, don't.

    I don't like this new plan one bit, either. But let it sink on its own merits, instead of drumming up false comparisons. You let your personal Gannett vendetta cloud any ability to report that you once had. Shameful.

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  2. Please re-read the first paragraph, which says (emphasis added here):

    "Gannett's new health insurance premiums are sharply higher than average prices across the nation for similar plans this year, before the Obamcare reform law took effect, according to data in the authoritative Kaiser Family Foundation annual insurance survey."

    In the headline, too, I say: "Post-Obamacare."

    Then, throughout this post, I very carefully distinguished between Gannett's prices next year and the national averages this year.

    I'm sorry you apparently read this post too quickly to see all the specific qualifiers I included. If I was trying to pull a fast one, I would never have included these fourth and fifth paragraphs:

    "To be sure, there's a big caveat in directly comparing the GCI and Kaiser data. The company's figures are for the new high-deductible employee plan starting Jan. 1, while the Kaiser data are for 2013 high-deductible plans, and are based on a survey of 2,067 firms done from January to May.

    "Indeed, when Kaiser reports figures in next year's survey, they may be much closer to the company's new premiums and deductibles if other major healthcare companies raise their rates, too."

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  3. Jim,
    Thanks for your work, caveats and all. It's about the best explanation of what's going on I've seen and certainly more honest than what Gannett will be telling its employees. Gannett has a history of exploiting bad situations to its economic advantage (its early adoption of pay cuts and mass layoffs during the onset of the 2009 recession). Here, it seems to be using Obamacare as an excuse to shift more costs to employees. Very cheeky.

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    Replies
    1. Let us know what facts you have to back up the claim that Jim's ramblings are more honest.

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  4. Can GCI employees drop their company coverage and apply for Obamacare?

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    Replies
    1. I'll have to research that. For the most part, I think you can, but you won't qualify for the government subsidies that make the exchange plans really cheap.

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  5. Kaiser has published a survey of 2014 monthly premiums from the exchanges: "For example, the lowest cost bronze plan for a 40-year-old ranges from $146 in Baltimore, Maryland and $155 in Albuquerque, New Mexico to $308 in New York, New York and $336 in Burlington, Vermont."

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  6. I left the Gannett family last year for another large media company. My healthcare costs dropped by 50%, but we had the deductible and 80/20 split too. For 2014 I will still pay 50% less than the new Gannett plans, and my deductible and max OOP are about 40% of what Gannett plans.

    Hate to say it, but Gannett cares nothing about its staff and using Obamacare as an excuse. In fact, in a larger than Gannett media company, my rates increase by $7 each 2 weeks next year! I'm glad I'm an ex-Gannetter.

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    Replies
    1. It's definitely "Gannettcare" for sure. Obamacare was Gannett's scapegoat to cut benefits for its employees.

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  7. Martore and the rest of the "senior leadership team" can go fuck themselves. This is outrageous by any standard. Does she have a decent, sincere bone in her body?

    Best regards my ass!

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  8. Has anyone else had trouble getting Caremark to focus more on patient care than on saving money for Gannett? Today, for the fourth time, all I got was a busy signal when I finally got transferred to a representative. Then, I finally got through and the person answering on the other end ran through a quick statement about all systems being down while they are updated and suggesting that I call back in a few hours. Then she hung up, before I could get in a word. So much for the Customer Care number. By the time I get through, I fear that Caremark will be closed for the day. In the meantime, my prescription for an anti-cholesterol drug is on hold and I have an increased risk of a stroke or heart attack. This all began when Caremark demanded a generic drug instead of the brand name that my doctor prescribed. It's only for a month, so it hardly would have cost more in that time. If I have a heart attack, the costs would be far, far greater not just for me but for Gannett. Why does Gannett use Caremark, but to save money by rejecting coverage at every turn? And why doesn't Gannett fire this incompetent company?

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    1. Because Caremark is doing exactly what Gannett hired it to do -- deny as much benefit payout as possible.

      Your problem is about to get a whole lot worse, too, come Jan. 1. You'll be paying it all yourself then, at least until you've emptied your wallet.

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    2. Thank God SOMEBODY is trying to hold down health care costs -- especially if I'm paying a bigger share!

      Fire that doctor. These days 99% of providers know the drill and will write the script correctly without being told. Should not be an issue.

      Finally, why would anyone in this day and age use the phone? (Four times?)

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    3. 12:16, why are you posting? You have no idea what you are talking about. Zero.

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  9. You won't have to worry about that much longer when you pay full price for your prescriptions

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  10. The new Gannett "choice" plan -- no choice, you take it or leave it -- appears to be in line with the lowest benefit offered as the "bronze" plan under ACA. But it may not even be that good.... nor as affordable.

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  11. We're all in this together.

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    1. I think this should be the final blow for anyone working for Gannett. I know most were staying just for the health benefits but now there really is no reason to stick around. Lousy health benefits, no raises, furloughs, layoffs — get the picture. Time to move on to greener pastures.

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    2. No reason, other than the paycheck, of course.

      You should try thinking before you type and post.

      Delete
  12. It's amazing to see how dumb some of the recent posts are. Things had improved for a while when Jim was at least trying to look at the health care issues.

    But now, things are back to normal. The people with no clue are rushing to outdo each other.

    As always, the ultimate blame goes to the guy running the show. Great job, as always, Jim.

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Jim says: "Proceed with caution; this is a free-for-all comment zone. I try to correct or clarify incorrect information. But I can't catch everything. Please keep your posts focused on Gannett and media-related subjects. Note that I occasionally review comments in advance, to reject inappropriate ones. And I ignore hostile posters, and recommend you do, too."

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