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What Does Health Care Reform Mean for You?

Interview with Kyle Cavanaugh, vice president for Administration

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In January 2014, many major components of the Affordable Care Act go into effect. Working@Duke sat down with Kyle Cavanaugh, vice president for Administration, to discuss how those changes might affect health care for faculty, staff and their families.

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What changes can Duke employees expect in 2014 as a result of national health care reform?

We have been incredibly fortunate through a combination of proactive plan designs, modifications in our network, and expansion of preventive options such as LIVE FOR LIFE and DukeWell that our health care expenses have been running below the national trends. Based upon these positive outcomes, we will only be making modest changes to our plans for 2014.

The big change for everyone is the federal mandate for individual coverage, which means that all U.S. citizens will be required to carry health insurance beginning in January 2014. Since we currently offer four health plans and cover more than 90 percent of eligible faculty and staff, there will not be a significant impact for most people at Duke in 2014.

Beginning in October of this year, there will be a new option to purchase insurance for 2014 through the federal government called the Health Insurance Marketplace, which is also called the Exchange. Most employees who are offered insurance through work are not eligible for subsidized coverage through the Marketplace, so this option may make the most sense for part-time employees who are not eligible to participate in our plans and a few others who may qualify for a subsidy.

How will Duke's plans compare with the Health Insurance Marketplace?

We will continue to offer four different plans to meet the diverse needs of our faculty, staff and their family members, and premium increases for 2014 continue to be below the average increases projected nationally.

The Health Insurance Marketplace will also offer different levels for its plans. These plans will cover the same set of benefits as defined by the federal government but will differ in monthly premiums and out-of-pocket costs for care.

At Duke, we pay most of the premium cost for individual coverage and about half the premium for family coverage. But in the Health Insurance Market, individuals will be responsible for paying the entire premium, unless they qualify for a subsidy from the federal government.

Consumers will need to compare costs and coverage of federal plans with what is available through Duke to make the best decisions for themselves and their family.

What can we expect in the future?

While we are just beginning to communicate about our health plans for 2014, we are already starting to think about plans for 2015. The national health care environment is continuing to evolve, so it is difficult to predict how things may change in the coming years.

Health care reform is changing the dynamics for what has been largely an employer-provided benefit since World War II, and we are just beginning to see some of those effects. For example, in the last few months, we've seen some major employers announce that they will drop coverage for spouses as a way to manage increasing costs. Others have turned to private exchanges for their retiree health insurance.

It is too early for us to determine how these changing dynamics will impact us, but we will continue to monitor the trends closely and assess how best to meet the health care needs of our faculty, staff and dependents.