ELCA Health Care Cost-Sharing Approved

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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