HMSA's new health plan increases cost for workers
By Deborah Adamson
Advertiser Staff Writer
HMSA will unveil a new health plan today that would save businesses an average of 7 percent but would increase the cost to workers.
Called CompMED, it would be the only comprehensive health plan in Hawai'i that would cover 80 percent of medical costs, with the potential for wide acceptance by companies. At present, most of Hawai'i's insured enjoy 90 percent coverage or better.
If approved by the state, average monthly rates for the basic plan would be $224.38 for one person, $448.76 for two people and $673.14 for a family. Prescription drug, dental and vision benefits would be separate.
Employees could see any doctor, but would have to pay more for using the 4 percent of providers who don't participate in HMSA's plan. There would be no deductible, and copayments for visits to the doctor would be fixed at $12. For care other than doctor visits — such as hospital visits, X-rays and surgery — the insurance would cover 80 percent and the employee would pay 20 percent.
After an employee spends $2,500 per person, or $7,500 per family, in annual out-of-pocket costs, additional care would be 100 percent covered. Preventive-care services such as pap smears would be fully paid for, and there would be no limit on doctor visits for mental-health or substance-abuse treatment.
The new plan will take effect on July 1, in time for most renewals by HMSA's small-business customers. It is not open to individuals.
"It offers employers options," said Ken Gilbert, president of Business Consulting Resources in downtown Honolulu, who employs four. "Anything that provides businesses an opportunity to decrease their overhead is really worth considering."
Demand from companies for lower-cost plans motivated HMSA to come up with CompMED, especially since the cost of healthcare has been rising by double-digit percentages, said John Jacobs, its vice president of marketing.
The state's largest insurer expects medical costs to go up by 9 percent to 10 percent this year, he said.
If workers have to pay more for health insurance, Jacobs said, they might be more judicious about how often they see the doctor. Lower use, among other things, should help keep medical inflation at bay.
"This is a step in the right direction," said Gary Lee, senior vice president of Marsh Inc. in Honolulu, an employee benefit consulting firm. "We have to get the public to become wiser consumers of healthcare."
But that doesn't fly with Honolulu retail manager Joni King.
"Oh, my gosh! Are you serious? Don't they realize that most people don't like going to the doctor?" she said. "That's ridiculous. Most people in Hawai'i don't make that much money. Why doesn't HMSA pass on their profits by lowering rates?"
In the early 1990s, HMSA had offered an 80 percent basic plan for major medical costs, but switched to the 90 percent Preferred Provider Plan because of the former's complexity, said Paul Tom, chairman of the Prepaid Health Care Advisory Council.
For years, Hawai'i residents generally have enjoyed out-of-pocket costs that are lower than those for people on the Mainland, where patients often have to pay hundreds of dollars in deductibles a year, said Marsh Inc.'s Lee. But cheap healthcare shouldn't be seen as a right, he said.
"What we're dealing with is an entitlement mentality," he said. "It's not free money. Somebody's paying for it."
Reach Deborah Adamson at dadamson@honoluluadvertiser.com or 525-8088.
