TRS switches medical benefits administrators for active employees and retirees

During its first meeting of the year, the Teacher Retirement System of Texas (TRS) Board of Trustees voted to switch administrators for its medical benefits programs for active educators and retirees. TRS will end its contracts with Aetna and Humana.

Effective Sept. 1 of this year, BlueCross BlueShield of Texas will begin administering TRS-ActiveCare for active employees. Beginning next Jan. 1, BlueCross BlueShield will take over TRS-Care Standard for non-Medicare retirees, and United Healthcare will begin administering Medicare Advantage.

There will be more information coming from TRS on the new plans, including tools to help members determine if their medical providers are part of the new networks.

TRS says the new contracts are expected to save $754 million across all health plans over the next three to five years. TRS believes those savings will strengthen its medical benefits programs. TSTA hopes that the savings will result in reduced out-of-pocket expenses for participants, but we can’t say yet how the savings will be applied. TRS has said that premiums and benefits will remain unchanged next year.

TRS also reported that United Healthcare will offer a larger selection of providers from which TRS-Medicare Advantage participants can choose and that 99 percent of the providers that TRS-Care participants use the most are in the network.

Does your district want to create its own self-funded insurance plan? It will be costly, TRS warns

The Teacher Retirement System has posted a warning to districts that may want to leave TRS-ActiveCare and form their own stand-alone, self-funded health insurance plans for employees. Some districts of innovation apparently are considering this possibility. The bottom line: It will be more expensive, TRS says, beginning with the need to “develop and budget for administrative expenses, a comprehensive benefits team and added outside resources necessary to effectively manage the health and welfare offering.”

TRS also warns about insurance companies offering enticingly low rates to get a new customer’s business and then hitting the customer with significantly higher rates later. Here is a TRS-prepared comparison of costs between districts inside and outside of TRS-ActiveCare.