HealthFlex Rates and Impact on Local Churches

All of us in the Rocky Mountain Annual Conference are concerned with health care coverage costs and the burden it places on local church budgets. Our concern is not unique; this is a national problem which has initiated a great deal of discussion, but little in the form of viable solutions. There are, however, some unique characteristics of our Conference which affect the rates that we pay. For example:

1. Our current plan contains benefits that are better than many other plans. We provide dental coverage, prescription drugs, and emotional/ psychological counseling, etc. In addition, our levels and breadth of coverage make our plan stronger than even those which provide similar benefits. When comparing our rates to the rates of other plans, it can generally be stated that if the other plan has lower premiums, it likely has lower benefit levels as well.

2. The average age of plan participants in our Conference is higher than the national average. The theory behind health insurance is to spread risk across a broad spectrum of persons and thereby share the cost among those who are healthy as well as those who are ill. Our statistics show that our clergy and church employees are older than the general population, with a particular shortage of younger, healthier people in our insured pool. Since older people have greater health care costs and there are few younger clergy who have relatively fewer costs, our overall rates tend to be higher. As our clergy continues to age this factor will become even more pronounced.

3. Our broad geographical and low population density contributes to a higher cost level than in smaller, more densely populated areas. While it is true that health plans offered in the Colorado front range are less expensive, as a Conference we must provide the same coverage to areas such as Torrington, Gillette, and Sundance in Wyoming, Price, St. George, and Ogden in Utah, and Saguache, Haxtun, and Walden in Colorado. Churches in different geographic areas have different cost factors when quoted by insurance carriers. We ‘blend’ or average all of these rates so that no clergy and / or no church is unduly penalized because they are not located in a densely populated geographic area. It should be noted that individual clergy in these “non-Metro” areas absorb an additional personal expense burden in the form of deductibles and potentially higher co-payments.

4. Many private sector companies pay a significant part of employees’ health insurance premiums, therefore this “cost-sharing” often hides the full cost of coverage from a participating employee. Our Conference passes along the entire cost of our plan to each church, which can make our rates look even more out of line with what other individuals may be paying through payroll deduction.

Your Conference Board of Pensions and Health Benefits will continue to look at all possible alternatives in plan design and other approaches to minimize the cost of health insurance. We are convening a task group to evaluate the long-term cost of clergy benefits and will be reviewing health insurance plan design and the funding of retired clergy health care. We welcome any thoughts or ideas you have regarding our health insurance coverage.

-- Wayne Bettendorf, Pension Officer