DALLAS (BP)–Southern Baptist ministers and other church employees and seminarians covered by the Personal Security Program (PSP) medical plans will see rates for coverage rise 5 percent on July 1, the Annuity Board of the Southern Baptist Convention announced today. Participants were advised in November 1997 that a mid-year increase in 1998 was possible.
“The trend in claims and charges by hospitals, physicians and drug companies combined to make this increase necessary,” said Douglas D. Day, managing director of insurance services for the Annuity Board.
Outside consultants observed that medical costs nationwide have risen 49 percent in the years since 1992, but the Annuity Board raised general rates only once, by 7.6 percent in January 1996. The rate for people who are Medicare primary experienced an increase in January 1998, due to heavy losses in that part of the PSP plan. The July increase will apply to all PSP participants.
Paying the new rates will be participants in the various plans known as Comprehensive Medical, Catastrophic 1000, Catastrophic 2000, Seminarian Major Medical and Point of Service Plus.
The Personal Security Program (PSP) covers more than 18,000 participants and their dependents, most of them in churches with fewer than 10 employees. Being a self-funded plan, it must pay its own way without subsidy from the Cooperative Program or other denominational sources of income. “We never want to increase rates,” said Day, “but time and trends finally caught up with our claims experience. I’m just grateful we avoided a rate increase as long as we did. Most plans had to raise rates Jan. 1, 1998, or whenever the plan anniversary fell within the last year.”
Bills for June 1998 coverage, being mailed the first week of May, will have a notice of the increase, and letters will go to participants about the middle of the month. The July bills, mailed in early June, will reflect the new rates.
