Click image to enlarge.
Union Overview: Recognized as one of the most active District Councils in its trade, this KTP client’s member’s donate time and financial resources to charities in the Delaware Valley, Northeast, Central Pennsylvania and Southern New Jersey. This group represents over 4,500 members in the finishing trades. The union is headquartered in Philadelphia, PA.
Plan Design Summary: Prior to the new plan design and structure, the union maintained a Self Funded Retiree Drug Subsidy plan. KTP created Retiree Benefit Solutions© that meet the union’s goals of:
- Reducing the union’s liability and lowering cash expenses
- Curtailing the risks of the existing self-funded retiree medical program
- Maintaining the same, if not better benefits for the union’s retiree population
- Minimizing the impact on the retiree population
2014 Results: KTP was able to move the union to a fully-insured EGWP model that eliminated all the financial exposures of the self-funded plan (healthcare cost trends, catastrophic losses, etc.) and greatly reduced the financial burden on the union, while improving retiree benefits.
KTP created a detailed financial analysis illustrating the likely impacts of various plan changes on the client’s retiree finances. Under the new medical plan, the union saved over $300k or 24.4% and the drug plan saved an additional $1.1 million or 41.9% for a total savings of $1.4 million or 36%.
2019 Results: KTP ran a competitive Rx RFP in 2018 resulting in a 26% ($500,000) decrease in prescription drug costs for the Fund. The incumbent PBM retained the business so there was zero member disruption. In addition to significantly reducing the monthly premium, KTP was able to negotiate a 5% rate cap for the 2020 AND 2021 plan years!
The 2019 total plan cost is 24% lower than it was in 2013 with improved benefits.