University of Nebraska employees will see their health insurance premiums drop 2 percent next year as a new third-party administrator takes over, the university said in an email late last month.
At the same time, NU negotiated a new contract with Nebraska Medicine that will enhance coverage for the system's roughly 27,700 employees, spouses and dependents who get insurance through the university.
Typical employees on a basic family plan will save about $275 on health insurance premiums next year, an NU spokeswoman said, while the university expects to save $5.5 million.
President Hank Bounds said the lower premium costs and expanded coverage were the result of a review of NU's insurance plan, itself part of a broader effort to close a system-wide $46 million budget gap.
The Board of Regents in June chose to move NU's health insurance plan to UMR, a United Healthcare company, and its dental insurance to Ameritas after 21 years of Blue Cross Blue Shield of Nebraska carrying both.
Bounds said switching NU's health and dental insurance third-party administrators and renegotiating its life insurance will save NU $11 million annually, including $6 million from state-aided sources.
"That we're able to improve the competitiveness and cost-effectiveness of our plan at a time of significant change in the health care market is especially positive news," Bounds said in his Sept. 26 email to employees.
The 2 percent drop in health insurance premiums comes after NU absorbed an increase of 5.7 percent last year, which was less than the 10 percent administrators had originally estimated.
That was the second time since 2009 NU employees saw a premium hike, according to Bruce Currin, NU's associate vice president for human resources.
As the cost of premiums dips next year, there will be no increases in deductibles, co-payments or the maximum out-of-pocket cost to employees, the email said.
NU employees will also receive expanded coverage as part of a direct contract between the university and Nebraska Medicine for care, as well as a consideration by UMR to expand its network of providers.
* The new plan will cover fertility treatments, as well as tubal ligations and vasectomies.
* Dependents under the age of 2 will have 100 percent of their preventative care visits covered, up from the previous maximum of $600. The preventative care allowance for dependents older than 2 will increase from $300 to $400.
* The addition of a high-deductible plan will allow employees to contribute to a tax-free health savings account.
* Long-term disability rates will decrease by 25 percent.
University employees will also pay 20 to 30 percent less for life insurance, after NU renegotiated its contract with Assurity Life.
The new life insurance contract will save an estimated $1 million annually, NU said.