Medical Insurance Employee Contribution Tiers

Frequently Asked Questions

1. How is my contribution for medical insurance determined?

Your medical plan monthly cost depends on the plan and coverage you choose, as well as your Medical Contribution Compensation (MCC). Medical plan rates are tiered based on your MCC, so that contribution rates are related to your level of University compensation. The introduction of a compensation based contribution system is part of the University’s strategy to maintain choice and make medical insurance more affordable for employees who wish to cover eligible dependents.

2. How is my MCC calculated?

Your MCC is defined as the annualized base pay rate you are appointed to receive through the University or affiliated organizations. Private Practice Plan (PPP) earnings for the prior year of medical professionals at the Health Sciences Center are also included in the calculation of their MCC. The MCC does not include:

Overtime payments
Compensation for adjunct teaching by benefits eligible employees
Compensation received for summer session or other vacation period employment in excess of regular salary
Any remuneration received which is in excess of 100% of full-time equivalent for your regular position, and
Any perquisites or bonuses or other special compensation which occur on an irregular basis.

3. How is placement in the MCC salary tiers determined for medical professionals in the Physicians’ Practice Plan (PPP) and/or those who are funded through affiliate sources?

Salary from HSC and from affiliated sources is combined and included in determining base salary. In addition, actual PPP income from the prior 12 months ending October 15, will be added to the base salary to determine the MCC.

If a physician is assigned to affiliated agencies, funding received from those agencies will be considered as base salary and will be aggregated with HSC base salary.

Example A:

Source	FTE	Salary/Earnings
HSC	.50	$30,000
Affiliated Agencies	.50	$30,000
Base Salary for MCC		$60,000
PPP Earnings (Oct 15, 2006 - Oct 15, 2007)		$40,000
Total MCC		$100,000

Example B:
A physician was hired in July 2007 and began receiving PPP income that month. Only PPP income received July 15, 2007 through October 15, 2007 will be added to the base salary to calculate the MCC for 2008.

Example C:
A physician has been working since October 2006 and began receiving PPP income that month. Income received October 15, 2006 through October 15, 2007 will be added to the base salary to calculate the MCC for 2008.

4. Is family income included as a basis for any tiers?

No. The tiers are based only on the OU employee’s OU income. The original Committee recommendation had a low-income tier based on family income; however, that recommendation was not brought forward to the Regents.

5. What happens if the employee’s salary changes during the year?

If the employee’s MCC after the salary increase still fits within the range for their existing contribution tier, there will be no change in contribution rates. However, rates will be adjusted on the next payroll if the salary increase or reduction causes the employee’s MCC to fall within a different contribution tier.

6. Will employees continue to receive a $50 monthly credit for waiving medical insurance?

Yes. The employee must provide appropriate proof of other medical coverage in order to qualify to receive the credit.

7. Will there be a rate available for two University employees who are married with dependents?

No. However, Blue Cross Blue Shield can combine deductibles and out-of-pocket maximums for two married OU employees with a family. Contact Blue Cross directly for this. If they are in different tiers, the couple should cover the children through the employee in the lowest tier to obtain the lowest contribution rate.

8. How do the additional University contributions toward dependent coverage affect my Oklahoma Teachers' Retirement System contributions?

Any additional credits an employee receives to offset dependent coverage would be considered in their total compensation. Employee and employer contributions to OTRS are based on your total compensation.

9. What should I consider when choosing a medical plan?

Premium rates are not the only things to consider when choosing a medical plan. There are significant differences between the plans that should be looked at. Click here for a comparison of the medical plans.

10. What is the definition of a dependent child?

Eligible dependents include unmarried children up to age 19, or age 25 if a full-time student, including foster children or any other children dependent upon the employee for support. Employees may be asked to provide legal documentation of custody for eligibility audits conducted periodically by the healthcare provider.

11. What constitutes spouse eligibility?

Spouse eligibility includes marriages recognized by the State of Oklahoma, including common-law marriage.

12. How will tiers and rates for part-time employees be determined?

Tier and rate designations for part-time employees can be found by choosing the appropriate rate table on the current rate tables. These rates and tiers are determined on a pro-rated basis by converting your part-time salary to a 1.0 full-time equivalent (FTE) salary. Make this conversion by dividing your salary by your FTE appointment.The rate charts take this conversion into account; no additional calculations are needed to determine your tier and rates.

Example:

FTE Status	Salary	Pro-rated Conversion to 1.0 FTE
Half-time (.5 FTE)	$15,000	$15,000/.5 = $30,000
Three quarters-time (.75 FTE)	$33,000	$33,000/.75 = $44,000

13. What happens if an employee adds or drops spouse, dependent or family coverage during the year? Coverage for spouse or dependents added or dropped due to qualifying events allowed by IRS regulations, and the coinciding premium and credit, would begin on the first of the month following the qualifying event. Visit "Benefits for current employees" on the main HR website for more information.

14. When will the salary-tier structure begin? January 1, 2008.

15. What changes to eligibility for retiree medical insurance benefits have been made? No changes have been made that affect current OU retirees or OU employees hired before January 1, 2008. However, because of the rapidly increasing costs of providing retiree medical insurance coverage, employees hired on or after January 1, 2008, will not be eligible for the current retiree medical insurance program.

16. Will I be forced to retire earlier than planned to enjoy a better retiree medical benefit? No. Current employees who are eligible to retire will not benefit by retiring sooner to receive a better retiree medical benefit. This group of employees will receive the same retiree medical benefits as current retirees when they choose to leave University employment. Current retiree medical benefits include 100% employer-paid premiums for the retiree only.

17. I am approaching eligibility for retiree medical benefits. Is it true that OU is planning significant changes to retiree medical benefits and contributions that will affect me? No. President Boren has been clear that no changes in the retiree medical insurance benefits are planned that will impact those long-service OU employees who are approaching eligibility to retire. However, the high cost of retiree medical insurance benefits makes it necessary for the University to investigate long-term strategies designed to manage these increasing costs in the future. As a result, President Boren has asked the Contributions Strategy and Health Insurance Options Committee to continue to review potential future changes to the University’s retiree medical insurance benefits. Any future changes will be announced well in advance of their effective date.