An advisory panel Friday recommended that the state explore offering Medicare managed care plans to retired state and public school employees covered by the federal program for the elderly and disabled.
About 18,000 retired state and school employees are enrolled in state plans that supplement traditional Medicare coverage.
Under the recommendation by the State and Public School Life and Health Insurance Board's benefits subcommittee, the board would solicit proposals from companies that offer Medicare Advantage plans.
Such companies receive a fixed amount from the federal government to provide health benefits to Medicare enrollees.
The enrollees pay their normal Medicare premiums, plus any premium charged by the insurance company.
Mark Meadors, a consultant to the Department of Finance and Administration's Employee Benefits Division, said the plans can offer benefits beyond those provided by traditional Medicare, including programs aimed at managing chronic diseases and reducing enrollees' health care costs.
A study last year found that switching to the privately managed plans could be cheaper than the state providing supplemental coverage.
Currently, retired state employees pay $161.96 a month for individual supplemental coverage that includes drug benefits. School retirees pay less -- $98.80 a month for individual supplemental coverage -- but their coverage does not include drugs.
Under the subcommittee's unanimous recommendation, the proposals from insurance companies would have to offer coverage equivalent to that provided by the combination of Medicare and the state's supplemental coverage. The Medicare Advantage plan would replace the state's supplemental coverage.
Shelby McCook, chairman of the subcommittee, said he isn't ready to support switching to Medicare Advantage but wants to issue the request for proposals to see what the plans can offer.
The subcommittee's recommendation will go to the full board Jan. 20.
Donna Morey, director of the Arkansas Retired Teacher Association, said after the meeting that she was concerned about whether doctors would accept patients covered by the plans.
"I would need to study it more to say this is a terrible idea, but we probably wouldn't support it if that was the only option," Morey said.
Marc Watts, senior legislative analyst for the Arkansas State Employees Association, said the plans could be an improvement if they offer the same benefits at a lower cost, but the association's support will depend on the details.
Metro on 01/10/2015