Title: ELCA Health Care Cost-Sharing Approved
ELCA NEWS SERVICE

November 18, 1999

ELCA HEALTH CARE COST-SHARING APPROVED
99-292-SS***

     MINNEAPOLIS (ELCA) -- The ELCA Board of Pensions trustees, at a
Nov. 5-7 meeting here, approved a move to price the ELCA health plan
more competitively and to confine cost-sharing among congregations as
one interdependent church. The ELCA Church Council will act on the new
rate structure at its April meeting. If approved, the new rates would be
phased in beginning January 2001.
     Health-care costs are higher in some locations, such as large
metropolitan areas. Currently ELCA health care rates, based on salary,
are not adjusted for geographic differences, said David Adams, Board of
Pensions vice president for research and design.  Because of that, the
contributions for most ELCA congregations exceed the average cost of
coverage for their area.
     With the new rates, ELCA congregations would be contributing
closer to the actual cost of coverage for the area in which they are
located. It would mean lower premiums for some and higher for others,
with some congregations subsidizing more vulnerable ones.
     "We want to encourage congregations to care for each other," said
trustee Larry Kassebaum, Mesa, Ariz. "Let's appeal to what's noblest in
others, not to what's selfish."
     "We have to be assured that we can tell our people our costs
churchwide are as low as they can be," said trustee Robert J. Thimjon,
Sioux Falls, S.D.
     ELCA health plan rates now include "related costs" to cover excess
claims for members on disability, contribution shortfalls for retirees,
and enrollment and billing. The new rates would strip out such costs,
allowing a true comparison with other health care plans, Adams said.
     Wide participation in the ELCA health plan is essential for
keeping benefits high and costs low, said John G. Kapanke, Board
president. The Board, which has 95 percent participation in its plan by
congregations and pastors, has studied the cost-sharing issue for some
time. All synod bishops have had input and will be consulted again
before Church Council action.
      "As the board member who's continually questioned other
cost-sharing proposals, I must say I like this proposal," said Lisa A.
Stump, a trustee from Des Moines, Iowa. "I do think it needs to be
phased in, or we'll have rate shock."
     "Clearly we're trying to retain a balance here," Adams said. "We
want to be competitive and also fulfill the ELCA's mission." He added
that the plan, if approved, would be phased in over three to four years.
Details on how the new rate structure will affect individual
congregations and synods will be communicated over the next year, Adams
said.
     The cost-sharing was included in the Strategic Plan 2000-2002
approved by the trustees -- a strategy aimed at keeping health care
priced competitively and maintaining a pension plan that "supports the
retirement needs of all of our customers."
The board also:
     +Adopted a 2000 budget of $43 million, up from $37.4 million in
1999.
     +Approved a move to an outside vendor for all remaining health-
care claims processing beginning in January 2001. This move will affect
30 current Board employees who have been included in the discussions.
"We can't compete with [large insurance companies] in processing
claims," Kapanke said. "We must continue to focus on our core
competencies as we make these decisions."
     +Elected Earl L. Mummert, Harrisburg, Pa., as chair of the board
of trustees.
     +Learned that the Board is redesigning its dental, pharmacy and
mental health programs over the next two years. This would bring managed
care to dental benefits for potentially greater cost savings. Pharmacy
costs make up about 25 percent of the board's health-care costs, and a
redesign should result in some savings, trustees were told.  Mental
health care would be expanded to offer more services such as marriage,
career or grief counseling.

***Sonia Solomonson is managing editor for The Lutheran, the magazine of
the ELCA.

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John Brooks, Director (773) 380-2958 or [log in to unmask]
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