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ORS Process

How ORS Develops Its Retiree Healthcare Plans: The Health Initiative Strategic Plan

The healthcare plan for Michigan public school retirees was established by the Michigan Public School Employees Retirement Act. The Michigan Public School Employees’ Retirement Board and the Department of Technology, Management and Budget (DTMB) have a shared role in maintaining this healthcare plan and making decisions about the coverage.

In the early 1990s, the Board, with the support of DTMB, began a strategic health initiative planning process. The goal of this process has been to improve health outcomes and keep coverage affordable for both retirees and the school districts. Over the years, numerous initiatives have been implemented to balance covered services and medications with ensuring the continued long-term financial stability of the retirement system healthcare plan.

How the health initiative strategic planning process works

Staff from the Michigan Office of Retirement Services (ORS) work with healthcare consultants to develop proposals for plan updates. Member feedback, healthcare industry trends and financial metrics are taken into consideration when drafting an initiative package. Once an initial package of updates is put together, it is presented to the Board and DTMB Director. This presentation is followed by a public review process, in which feedback and comments from retirees and retiree support organizations are received. Any feedback received is reviewed and may result in revisions being made to the initiative package. Lastly, the Board and DTMB Director review the public feedback and final recommended initiatives and decide whether to approve the plan changes.

Once an initiative package is approved, ORS staff work with the health insurance carriers to implement the plan changes.  The groups work together to communicate plan changes to members and develop benefit booklets and presentations to educate members about their plan coverage.

What role do the insurance carriers play in the retirement system healthcare plan?

The insurance carriers do not make decisions about covered benefits or deductibles, coinsurance, or copays. The coverage and cost sharing are determined by the Board and DTMB director, with guidance from ORS staff and healthcare consultants. The carriers administer the plans as directed by ORS.

As part of their role in administering the plans, the carriers establish networks of qualified providers, negotiate discounts to keep the cost of services low, and provide programs to help members manage their health. They also process claims, answer coverage and billing questions, and manage membership ID cards. The carriers produce benefit booklets and educational materials to assist members with understanding their coverage. They also support members through their call centers, websites and mobile apps, all designed to provide members with the information and tools they need to get the most value from their plan.