BENEFITS CORNER
By Al Horan
Since the last Benefits Corner article there has been a bevy of activity. Open Enrollment for the Chevron Medical Plans and Dental Plans took place; the Verizon Wireless discount was rolled out; the hearing aid discount program with Hear In America has been picking up pace; and the composition of Congress has changed.
Chevron Health Care Plans – Open Enrollment
Open Enrollment progressed with only a few hiccups. Some eligible retirees received their Enrollment Kits late. While this was disconcerting it only impacted anyone who wished to change their coverage for 2015. Anyone who wished to retain the same Plan Coverage for 2015 was automatically reenrolled in the same Plan as 2014. Chevron apologized for the late delivery of the Open Enrollment Package. As in past years, very few retirees elected to change their coverage.
Verizon Cell Phone Discount
It took awhile but the discount is finally here. We are very thankful to Chevron and Verizon for making the discount a reality. This is a big deal since Verizon only offers a discount to a handful of other retiree groups.
The discount is available to Chevron and legacy retirees who qualify for Chevron medical plan coverage. The discount applies to qualifying voice plans with monthly fees of $34.99 or higher; and to qualifying data features with monthly access fees of $24.99 or higher provided they are added to a qualifying voice plan. Promotional/loyalty calling plans, data-only plans, Nationwide Unlimited Minutes and secondary lines for Family Share plans do not qualify. Also, mobile telephone numbers that originated without a contract term are not eligible. Finally, the Verizon Wireless account must be in the name of the retiree.
If you are already a Verizon customer you can apply for the discount by filing with Verizon. The instructions can be accessed by visiting the Retiree Resource Links page at the CRA website (www.chevronretirees.org). The Verizon link can be found in the “Retail” section. Just follow the instructions to validate your eligibility. If you are considering switching to Verizon, you will be able to apply for the discount after switching your service to Verizon. Just follow the instructions outlined above for existing Verizon customers to obtain the discount. As part of the filing process you will be required to provide Verizon with a copy of your retirement confirmation letter or a pension statement, if applicable. If you cannot produce either of these documents, you can file a confirmation letter that will verify your eligibility. A confirmation letter can be requested from Jim Bateman, Administrator for the Verizon discount. You will be required to provide him with your full name, your Verizon Wireless account number and your cell phone number. Jim’s email address is jsbateman@att.net and his phone number is 916-467-7520. Jim is a Member of the Benefits Committee and the President of the Sacramento Chapter.
So far, Jim and his wife, Sybille have received more than 100 requests for confirmation letters. We are extremely grateful to them for championing the project. Please join with me in thanking them for all their hard work.
The Verizon discount is just one of many discounts that are available to retirees through Chevron. Discounts are also available on both small purchases and major purchases like automobiles, i.e. Ford, Chrysler, Honda (San Francisco only) and GMC (must belong to the Chevron Federal Credit Union). For more information please visit the Chevron Recreation website chevrec.mybigcommerce.com.
Hear In America – Discounted Hearing Aids
Our Members continue to take advantage of the discounts offered through HIA. There are currently 87 Members registered, of which 12 have purchased hearing aids.
HIA is able to offer discounts ranging from 30% to 50% for top of the line hearing aids. In addition, they also offer other services that include a three-year warranty and free maintenance for the life of the hearing aid. To avail yourself of these great savings and services you must first enroll with HIA. There isn’t an enrollment fee, a premium or a service charge. You can enroll on line at www.hearinamerica.com or by phoning them at 1-800-286-6149. HIA’s hours are 9:00 AM to 5:15 PM Eastern, Monday through Friday.
Future of Health Care Reform
Now that the elections are behind us and there will be a change in the composition of Congress, what will happen to Health Care Reform? As we follow the debates, it might be helpful to ask ourselves if the following issues are being considered:
- The U.S. spends $7,662 per person per annum for medical care. This is about 2.6 times the average of the countries in the Organisation for Economic Co-operation and Development (OECD), i.e. United Kingdom, Mexico, Canada, Australia, Germany, etc.
- The U.S. devotes 16.9% of GDP to health care. This represents 1.8 times the average of the OECD.
- In spite of what the U.S. spends on health care, we rank 27th in life expectancy.
- The U.S. is the only advanced industrialized economy that does not provide health care to its residents.
- U.S. doctors spend almost an hour each day on paperwork for insurers. This averages approximately $83,000 per doctor per year.
- The growth in the health insurance industry is greater than the growth in the providers of health care.
- Health care administration represents about 30% of what is spent on health care. Also, more than 27% of all people who are employed in health care work in administration and clerical occupations.
- Health care spending in the U.S. is approaching $3 trillion. This includes approximately $900 billion for administration.
As I’m sure you can see from the above figures our health care system is in trouble. Just the plethora of health care insurance plans alone adds an administrative complexity that drives up cost. As I have written previously, the non-standardization of certain medical procedures can also drive up cost. Some doctors and hospitals have looked into standardizing the equipment and materials used for certain medical procedures, e.g. artificial joint replacements. Based on a cost comparison of knee replacement surgery performed in the U.S., U.K. and Mexico, the U.S. was by far the most costly - $34,000 versus $10,200 versus $12,800. Within the U.S., the cost for a service can also vary considerable within a limited geography.
As we know from economics, one way of driving down cost is to create competition. Unfortunately, this is easier said than done when it comes to medical care. There are quality issues, legal issues and logistics issues. In spite of these obstacles, there are organizations that are promoting medical tourism. Medical tourism is where arrangements are made for a individual to be treated in a country where medical costs are less but the quality of medical care is good. However, most health insurance, including Medicare, does not reimburse the cost of the medical procedure and travel. For a host of reasons, I have doubts about this form of competition becoming mainstream.
Finally, I would like to leave you with one additional thought – the form of future health insurance. As we know, there have been tremendous advances in medical technology. However, they come at a price. Under most non-HMO forms of insurance, individuals are able to see specialists without obtaining prior approval of their primary care physician. Likewise, doctors are generally able to order expensive tests and carry out expensive medical procedures without obtaining prior approval. Since individuals will typically have small co-payments, they will most likely agree to a test or procedure. At different times, I have heard lawmakers mention that individuals should have “skin in the game.” In other words, individuals should have meaningful co-payments (deductibles, etc.) to incent them to be economical in authorizing medical care, especially in non-life threatening situations. As the debates unfold in Washington we may hear more about these issues. In particular we could see a push towards further standardization of non-HMO health insurance plans with high co-payments (deductibles, etc.). I think that we’ll also hear about a greater use of HMO’s as an alternative form of insurance for individuals who would prefer to have lower co-payments. However, the quid pro quo with a HMO is controlled access to specialized medical care by a gatekeeper. In any event, it should be interesting to see what comes out of the debates in Washington – stay tuned.
If you have any questions please let me know.