Texas Teachers & Health Insurance: A Look Back – At What’s To Come

This post explains how Texas educators can save money on health insurance. But each plan analyzed below has a high deductible, which means that patients are now consumers. It doesn’t take long to blow through a few thousand dollars if you aren’t careful, so to see how you can save money on health care costs, check out The Guide to Buying Health Insurance, and Health Care.

 

IT’S THAT TIME of the year again. Open enrollment for Texas teachers and other school district employees has begun, so here’s my annual analysis of the health insurance plans offered through the Teachers Retirement System of Texas (TRS).

This isn’t my first rodeo; since 2014 I’ve shown time and again that when it comes to getting health insurance through this particular system, less is more. A lot more. I started back in 2014 with Managing Risk, Part 3 – Which Is Better?, where I evaluated the employee benefits of my alma mater, the Birdville Independent School District. Later that year I broadened the examination to five local school districts in To pay, or not to pay? That is the Question. In 2015 I wrote A Guide to DFW Metroplex School Districts’ 2015 Health Insurance, where I analyzed all 64 school districts in the greater Dallas/Fort Worth area. Then last summer I posted Texas Teachers Get Screwed – AGAIN!; a state-wide look at the state of health insurance for Texas educators and district employees.

Now I’ve come full circle, and in this post I’ll only be looking at the Birdville district offerings. But the same pattern still holds true for all other school districts in Texas that are insured through TRS – it almost never pays to upgrade from the least expensive plan.

You read that right; in case you missed it, in every year, and in every comparison I’ve done involving TRS health insurance plans, the same rather startling characteristic has held true – you don’t get what you pay extra for. In other words, when Texas teachers overlook the cheapest plans and instead buy the more expensive offerings with supposedly better coverage? They will not only spend more to stay well, but they will spend more – a whole lot more –  if they get really sick or injured, too.

The TRS has released its health insurance plan details for the upcoming 2017-2018 school year, so I thought I’d see if the old adage holds true: the more things change, the more they stay the same. In other words, will Going For The Gold – or this time around, the Platinum – make any more sense for Texas teachers, principals, counselors, coaches, janitors, cafeteria workers, and everyone else who gets their health insurance through this entity? Or will that well-established pattern change, to where paying more for a health insurance plan will actually save you money, in the long run?

Well I’m sorry to say that some things have changed alright, and not in a good way – premiums and out-of-pocket maximum limits have gone up. But other things haven’t changed, at all. In what could ostensibly be called good news, the TRS plan deductibles have stayed the exact same as they were last year.

That should be some welcome news except that, deductibles don’t matter. Seriously, they don’t. Except to the health insurance companies, who masterfully use them to manipulate customers into thinking they’re getting something extra, in exchange for their extra money. Well, they don’t.

Just look to last year when I posed a question for those considering the different TRS plans for single employees: would anyone wanting to buy insurance only for themselves “spend $3,276 more in premiums, just to take $1,500 off their deductible?”

Because almost 46,000 did, in 2015. And I’ll bet you that many, many ISD employees fell for the same trick last year, in 2016. The question is, will you still buy into this, in 2017?

When one buys insurance, it’s rational to think that the more you spend up front, the more you’ll save in case catastrophe strikes. But the other thing that hasn’t changed about the TRS health insurance racket, is how it mercilessly tricks hard-working members into getting nothing for something. Because that pattern has continued once again, too, as we’ll now see, by analyzing the plans offered to employees at my alma mater, the Birdville Independent School District.

NOTE: I only evaluated the Birdville ISD in this post, but the specific premiums for each school district can be found in that particular districts’ 2017-2018 Benefits Guide, then plugged into Dr. Wacasey’s Equation (app coming soon).

On the BISD benefits website I found the 2017 – 2018 Benefit Guide, which includes the details for all four TRS plans being offered next year. If you’ll remember, I use Dr. Wacasey’s Equation (P + O = W) to analyze and compare the plans, so the first bit of information we’ll need to get startedare the Premium, or P values:

When using Dr. Wacasey’s Equation, it’s important to find out how much the Premium will be for the entire year, as this will tell you how much your health insurance will cost you in total. Or as I like to say, this is how much it will cost you to ‘stay well.’ So in the following examples I’m going to take the monthly premiums and multiply each of them by 12, to arrive at the Annual Premium value I’ll plug into each Equation.

Next, we need the Out-of-pocket maximum, or O values:

Before we get to the comparisons, I want to point out a few things. First, Dr. Wacasey’s Equation makes it easy to compare health insurance plans, but it doesn’t necessarily tell you the whole story. It is a great place to begin your exploration, but you shouldn’t just rely on the results you get, to pick a plan. Since every health insurance plan has many options that can be extremely confusing, you need to take the time to study the important details of each that you’re considering.

The most obvious example is prescription benefits – if you suffer from a condition that is treated with exorbitantly priced drugs (like Harvoni, Remicade, or Humira just to name a few), then you need the extra prescription coverage benefits that Bronze-level plans rarely provide.

Second, 

Lastly, although they aren’t used in Dr. Wacasey’s Equation we’re going to take a look at the difference in deductibles between the plans. As I’ve said before deductibles make for great marketing tools to get you to upgrade, but otherwise they are useless to anyone except the health insurers, as we shall see.

So let’s start by looking at the first plan comparison, for an individual Employee:

 

I understand that all these numbers can be daunting, so here’s a more detailed explanation of what the information in the table means:

First, pay attention to the deductibles, which go from $2,500 for the Bronze plan down to only $1,000 for the Gold and Platinum. That $1,500 savings looks pretty good – until you consider how much extra in Premiums you’ll pay to get there. If you upgrade to the Gold you’ll spend a cool $2,520 more, and if you go for the Platinum you’ll fork over an extra $4,356. Hardly seems worth that $1,500 in deductible savings, does it?

Even better (or worse), upgrading to the Silver or Platinum plans means you have a higher Out-of-pocket maximum – $600 more to be exact. Talk about adding insult to injury; you pay more so you can saving more in case you need it, right? Wrong.

Scan across the Difference in WHAT you might spend row and you’ll see that in every case, upgrading from the Bronze plan will cost you more to stay well, and a whole lot more should you get sick.

Now for the Employee + Spouse comparison:

 

Again, notice how the deductibles may go down, but the Out-of-pocket maximums go up – by a whopping $1,200 this time – on the Silver, and Platinum plans. Here’s the details:

Take a look at the W row – a couple hospitalized after a car crash who went for the Platinum could spend almost ten. thousand. dollars more than a couple who bought the ActiveCare 1-HD (Bronze) plan. It’s antisense. Unfortunately, the same pattern continues with the Employee + Children plans:

 

Not much prettier, is it? I mean, look at how much more you could spend to upgrade a policy, with no hope of a return on your ‘investment:’

Spending $4,692 more on a Platinum plan – just to have your Out of pocket maximum go up by $1,200 – would pay for a lot of Christmas, or Birthday gifts. You could even start a couple of college funds with that money. And yet, something tells me that the fine folks at the health insurance company pulling the strings behind this folderol don’t possess enough empathy to ever feel like Scrooge…

Last but not least we’ll consider the Employee + Family plans:

 

Take a look at what it will cost a family just to buy the ‘Platinum’ plan. Almost $21,000 dollars. That’s a very nice used car (and a few years of car insurance premiums I’ll bet) for the 16 year-old driver. Or a small swimming pool. Or the difference between renting an apartment, and building equity in a home.

What that $20,928 isn’t however, is money well-spent on a health insurance upgrade:

Because in buying the Platinum plan all our family is doing is guaranteeing that – should a medical disaster happen – they will be on the hook for $9,456 more than a colleague, who bought the Bronze plan for them and theirs. Some kind of peace of mind, huh?

So there you have it. Looks like not much has changed for Texas teachers and school district employees, after all. They are still being sold a bill of goods where all is not as it appears; by a system that is designed (that is, intentionally designed ) to separate them from as many of their dollars as insurancely possible.

This is a sick, sick system that takes advantage of and punishes those who toil in our classrooms to educate youngsters, and help shape our future society. It is time for it to change, and the best way I know how to is through civil disobedience. Stop handing the TRS so much of your hard-earned money; unless you find that you need increased ‘coverage,’ don’t go for it. And if you do find that you need to upgrade, pick the lowest level possible that will get you there. My personal opinion is that very few of the Gold – and none of the Platinum – plans should be sold for the 2017-2018 year.

But that’s up to you – the employees of Texas’ school districts. After all, why would a health insurer charge you 5 figures a year just to provide you with something you’ll hardly ever use? Because they can, and you keep buying it. And as long as you keep doing that, things will never improve. As I said in my first book, “the only thing that is going to change the health care and health insurance industries change their behavior, is if you change your behavior.”

I want to give a big thanks to all the educators out there, without whom we would have no future. Now get busy educating yourselves and your colleagues – there’s lots of money to be saved.

 

You can follow Dr. Wacasey on Twitter and Facebook.

It’s not the COSTS of health care that are outrageous…it’s the CHARGES.

Physician. Health Insurance Agent. Author. Health care humorist. Medical satirist. Disruptor. At your service.

My name is Kevin Wacasey, and I’ve been practicing medicine since 1994. When I graduated from medical school, I took an oath to do no harm to my patients. To me, that includes financial harm. But since health insurance took over health care over 40 years ago, health care prices have skyrocketed. And despite what we’re told by the media every day, it isn’t the costs of health care that are outrageous; it’s the charges. So if you’ve ever wondered why we spend so much on health insurance and health care, then come along and join me as I explore the crazy world of Healthcareonomics. Health care doesn’t have to be expensive. Let me show you how. For speaking opportunities and to pass along your questions/comments, please email me at drw@healthcareonomics.com.

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2 Comments

  1. Dana

    I have the platinum plan (I don’t think our district even offers the gold plan). My 14 year old son was diagnosed with type 1 diabetes 3 months ago. My husband who is self employed and has already had one spinal fusion surgery has reinjured his back, and is contributing very little money. We are paying premiums for employee and family for the coming year-$2004 a month. 20 years! That’s how much of my life that I have invested in this career. I can’t afford the co-pays and deductibles as is. Going down to a lower plan means that I woul have to put out money up front that I don’t have. An endocrinologist as Texas Children’s out of pocket to meet my deductible? I can’t even afford the $50 co-pay! Insulin? The cost is criminal! I mean he only needs it to stay alive, but they don’t make a generic?!? And there’s no government help for someone who looks like on paper (gross wages) to be making $4800 a month regardless of the fact that I’ll only be bringing home around $2000 a month! What I CAN do is get a job at Walmart, and my children can then get a the medical help they need. Say goodbye to the 4 years I worked my butt off putting myself through college and graduating magna cum laude. Say goodbye to a rewarding job that I felt I was making a difference doing!

  2. Nanette Sommers

    I wish I had read this in August. You think you are thinking it all through in the rush at the beginning of the year. Plus, like you say, they play on the “pay more so I must get more” feelings. My husband had kidney cancer and melanoma several years ago but he’s absolutely fine now. We’ve always kept the top (TRS AC2) tier because it seemed like more coverage if he needed surgery again. But my raise this year was $20 and I’m paying about $145 more dollars per month in insurance. That means I’m working this year for about $1500 less! It is really causing us a monthly struggle. I wrote them and they try to push it off into the districts could contribute more and the deductibles have remained the same. TRS is a huge pool. Why can’t they get us a better deal?

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