The message below was emailed to U-M faculty and staff on April 30, 2007 and mailed to the U-M retiree community.

To:          Faculty & Staff Community
From:       Laurita Thomas
Subject:   Update on U-M health plan offerings in 2008

Colleagues,

Preparations for the array of health plans to be offered in 2008 began almost immediately after the late-2006 close of the sale of M-CARE to Blue Cross Blue Shield of Michigan and its subsidiary, Blue Care Network of Michigan. Coverage under the University’s M-CARE plans will come to an end on Dec. 31. The University continues its commitment to providing high-quality and comprehensive health benefits in its 2008 plan choices.

We are proceeding according to schedule as we plan for the next Open Enrollment period, Oct. 8-19. At that time, benefits-eligible faculty, staff, retirees and survivors will choose their benefits to be effective from Jan. 1 through Dec. 31, 2008.

I want to provide you with early information on the new plan to replace the M-CARE HMO, which was the University’s most popular health plan, as well as an update on the status of the additional health plan options to be offered to our community.

New Plan Replaces M-CARE HMO
Like its predecessor, the new plan (name to be finalized in May) will be one of our most cost-effective managed care options. It will be administered by Blue Care Network (BCN) of Michigan, but the plan and network will replicate, as closely as possible, the coverage and design of the M-CARE HMO. This plan differs from other commercially available BCN products and will be offered only at the University of Michigan.

The U-M plan will feature two tiers of access to providers. The first tier will provide continued access to the U-M providers in the current M-CARE network at the lowest out-of-pocket cost. The second tier will allow access to the rest of the BCN providers in Michigan with greater out-of-pocket expense and a referral from a first tier provider.

Premium rates will closely match the rates we would have expected for the M-CARE HMO in 2008 with normal annual increases. The monthly co-premium rates for all U-M plans are currently being determined with the vendors and the rates for each plan will be available on the Benefits Office Web site by August, well in advance of Open Enrollment.

Community Blue PPO Continues
The BCBSM Community Blue Preferred Provider Organization (PPO) plan offered since 2005 will also be available next year. This plan will continue to provide a cost-effective option for individuals who want access to a nationwide network of providers after the M-CARE PPO plan is discontinued at the end of 2007.

M-CARE Point-of-Service (POS) and Preferred Provider Organization(PPO) Plans
These M-CARE POS and PPO plans will be discontinued at the end of 2007. The BCBSM plan will continue to provide a PPO option with a national network of providers.

The University is currently evaluating whether a suitable replacement product for the POS plan is available, and whether it is necessary in our plan mix. Enrollment in the POS plan is low and demand has been on a decreasing trend since introduction of the PPO plans.

Care Choices
We plan to continue Care Choices in 2008. Effective April 1, Care Choices was purchased by Priority Health, a Michigan-based nonprofit headquartered in Grand Rapids. The Care Choices name is expected to change to Priority Health in 2008. More information including participating hospitals and providers will be available from Priority Health by August, and we will make the information available to you well in advance of our Open Enrollment period. We do not expect major changes in the provider network in southeastern Michigan, but more providers in western Michigan may become available to plan members. More information can be found on the Priority Health Web site at www.priorityhealth.com/newscenter/announcements/2007/ccmembers.

Health Alliance Plan
The Detroit-based Health Alliance Plan (HAP) will continue to be offered in 2008.

Comprehensive Major Medical (CMM)
The Blue Cross Blue Shield of Michigan CMM plan will continue to be offered in 2008.

GradCare
The GradCare plan for benefits-eligible graduate students will continue to be offered and will be administered by BCN beginning in 2008.

Next Steps

• Full descriptions of every U-M plan as well as their monthly premium rates will be available by August on the Benefits Office Web site www.umich.edu/~benefits/.
  
  
• Campus email messages, coverage by the University Record and home mailings to faculty, staff and retirees will keep you informed leading up to and throughout the Open Enrollment period.
  
  
• Open Enrollment books will be distributed in late September and will include plan costs and a plan comparison chart.
  
• Questions can be sent by email to benefits.office@umich.edu.