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.
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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.