Comments on: The GIC & Mass. Cities and Towns… http://www.letstalkhealthcare.org/health-care-costs/the-gic-mass-cities-and-towns/ Sat, 22 Nov 2008 05:14:24 +0000 http://wordpress.org/?v=2.5.1 By: David S. http://www.letstalkhealthcare.org/health-care-costs/the-gic-mass-cities-and-towns/#comment-3964 David S. Wed, 19 Sep 2007 00:29:22 +0000 http://www.letstalkhealthcare.org/?p=132#comment-3964 Two problems with the new law enabling cities and towns to join the GIC: it takes a very high percentage of the union votes to approve, and the town must first accept coalition bargaining. This law is set up (by design) to guarantee that acceptance of the GIC by the city or town will be very expensive in terms of other concessions given up at the bargaining table. No one at the state level really speaks for the cities and towns--and we wonder why local finance is so dismal. Two problems with the new law enabling cities and towns to join the GIC: it takes a very high percentage of the union votes to approve, and the town must first accept coalition bargaining. This law is set up (by design) to guarantee that acceptance of the GIC by the city or town will be very expensive in terms of other concessions given up at the bargaining table. No one at the state level really speaks for the cities and towns–and we wonder why local finance is so dismal.

]]> By: Michael Connor http://www.letstalkhealthcare.org/health-care-costs/the-gic-mass-cities-and-towns/#comment-3956 Michael Connor Tue, 18 Sep 2007 01:07:21 +0000 http://www.letstalkhealthcare.org/?p=132#comment-3956 As a Quincy teacher should I promte the GIC to my people? Thank You! As a Quincy teacher should I promte the GIC to my people? Thank You!

]]> By: Charlie Baker http://www.letstalkhealthcare.org/health-care-costs/the-gic-mass-cities-and-towns/#comment-3949 Charlie Baker Wed, 12 Sep 2007 22:30:10 +0000 http://www.letstalkhealthcare.org/?p=132#comment-3949 Sean - I'm not sure it's that big an issue for us within the GIC if we're just talking about smaller communities. If you put a few 500-1,000 life groups into the GIC's 280,000 member risk pool, the net/net effect on those of us who already do business with the GIC is pretty small - for three reasons. First, a small group of people - unless they're all incredibly expensive - is not going to change the over-arching medical expense of a really, really big group like the GIC. That's, in many ways, the primary opportunity in this for smaller communities. Second, it does cost the plans more to maintain operating relationships with four or five groups than it costs to manage one. We will save something, on the margin, by having individual groups join an existing account - like the GIC. Third, While the GIC offers a set of relatively complex products, offering one complex product to the GIC is probably less complex for the plans administratively than offering five - or six - or ten different plans to five or ten different customers. As far as the financial impact of accounts migrating into the GIC is concerned - and how that affects the carrier who has the existing account on a stand-alone basis - I really think that's a case specific issue. I can tell you that I believe most of our municipal business is with larger communities - and as I said in my posting, I'm not sure they'd save much by moving into the GIC. They get a pretty good deal from us already. Does that sound too self-serving? Sean - I’m not sure it’s that big an issue for us within the GIC if we’re just talking about smaller communities. If you put a few 500-1,000 life groups into the GIC’s 280,000 member risk pool, the net/net effect on those of us who already do business with the GIC is pretty small - for three reasons. First, a small group of people - unless they’re all incredibly expensive - is not going to change the over-arching medical expense of a really, really big group like the GIC. That’s, in many ways, the primary opportunity in this for smaller communities. Second, it does cost the plans more to maintain operating relationships with four or five groups than it costs to manage one. We will save something, on the margin, by having individual groups join an existing account - like the GIC. Third, While the GIC offers a set of relatively complex products, offering one complex product to the GIC is probably less complex for the plans administratively than offering five - or six - or ten different plans to five or ten different customers.

As far as the financial impact of accounts migrating into the GIC is concerned - and how that affects the carrier who has the existing account on a stand-alone basis - I really think that’s a case specific issue. I can tell you that I believe most of our municipal business is with larger communities - and as I said in my posting, I’m not sure they’d save much by moving into the GIC. They get a pretty good deal from us already. Does that sound too self-serving?

]]> By: sean grady http://www.letstalkhealthcare.org/health-care-costs/the-gic-mass-cities-and-towns/#comment-3948 sean grady Wed, 12 Sep 2007 21:13:01 +0000 http://www.letstalkhealthcare.org/?p=132#comment-3948 Charlie - What will this do to the bottom lines of companies like HPHC, Tufts and especially BCBS that currently insure the towns and cities that would be joining the GIC at these much lower premiums? Currently, towns and cities have deals largely with the local insurers (like the City of Boston with HPHC) and if they move into the GIC they will choose from many offerings at lower premiums. I would think there is the possibility that plans like HPHC would end up covering many of the same people at much lower premiums which would cut into your already very thin operating margins. These new GIC members will end up getting largely the same amount of healthcare at a lower premium cost and the plans may be footing the bill. I agree it is not billions but it is a significant amount. Charlie - What will this do to the bottom lines of companies like HPHC, Tufts and especially BCBS that currently insure the towns and cities that would be joining the GIC at these much lower premiums? Currently, towns and cities have deals largely with the local insurers (like the City of Boston with HPHC) and if they move into the GIC they will choose from many offerings at lower premiums. I would think there is the possibility that plans like HPHC would end up covering many of the same people at much lower premiums which would cut into your already very thin operating margins. These new GIC members will end up getting largely the same amount of healthcare at a lower premium cost and the plans may be footing the bill. I agree it is not billions but it is a significant amount.

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