Officials debate merits of private sector plans
After two years of faculty and staff shouldering high health care costs, the deadline to seek a quote from private insurance health companies has been delayed.
The deadline to search for alternative health care plans in the private market was extended because members within the state health care agency, Nevada’s Public Employees’ Benefits Program, opted to first ask for the available plans before requesting price quotes.
“I was opposed to not having as much information as I felt we should,” said Christopher Cochran, Nevada’s higher education representative on the PEBP board.
Some higher education leaders thought PEBP would seek quotes from private insurance companies next month. But PEBP decided to move cautiously during its May 16 board meeting to see if companies could provide alternatives to an HMO and high deductible plan.
If the private market can offer other viable health plans, PEBP will then ask for pricing information.
PEBP executive officer James Wells said it was unwise to seek quotes from the private market without knowing what plans it could offer first. He said PEBP had to be sure there was enough competition in the private market to offer cheaper costs.
“If we get to a point where there’s no competition, all you’re doing is going to a single [company] and asking for a price,” Wells said. “What we’re really looking at is is there a market and competition [to move to the private market].”
Without having an idea of healthcare prices in the private market within the next coming months, PEBP participants will likely have to wait until July 2015 for a solution, instead of the originally anticipated resolution date in July 2014.
PEBP decided to approach the private market in March after two years of pleading from higher education faculty and staff to find a way to decrease healthcare costs.
In July 2011, PEBP raised its premium rates and deductibles by more than 50 percent, putting many of its participants in a position where they could not afford health insurance or medication.
The surge in prices caused over 100 UNLV faculty and staff members to resign and find education jobs out of state. Since then, higher education members, who receive health benefits from PEBP, have repeatedly asked the agency to take action. But providing relief for PEBP participants has been an uphill battle.
PEBP and higher education leaders agree that there must be an end to the health risk the high costs have posed for some participants. But while faculty and staff want a prompt solution, PEBP board members feel a slow and thorough process is best.
“My assumption is PEBP wanted to take small steps so they don’t get some … folks upset for moving too fast,” said Gerry Bomotti, a leading advocate for changes to PEBP and UNLV’s senior vice president for finance and business.
Wells asserted that focusing first on what plans private health insurance companies can offer is the wiser plan.
“Part of the underlying assumptions is there has to be competition,” Wells said. “There’s not much we can do if there’s no market.”
But Cochran insists having pricing information as quickly as possible would be better.
“The one thing that bothers me is we end up kicking the can down the road,” Cochran said. “It’s an extra step.”
Bomotti said regardless of what information PEBP seeks first, participants would eventually find out if the health costs they are paying are reasonable. He said that information is priceless.
“I think that would help PEBP participants understand that their deal has been tested and is a good deal,” Bomotti said. “I think being able to tell PEBP participants that we looked at the [market] … would help participants see that PEBP is doing its best to see if there are better opportunities available.”
Wells said that PEBP wants to make sure it is not making hasty decisions.
“I wouldn’t say [it] is impossible for [a move to the private market] to be in effect by July 2014, but I would say it’s not likely,” Wells said. “But after all the changes we made two years ago, I would say we have to do this thoroughly and that it’s vetted in a way that’s best for our participants.”