Before we explain the premiums coming into effect on April 1, let’s clarify some aspects of group insurance.
True or false? I didn’t make any claims last year, which means my premiums won’t go up this year.
False. When you have an individual insurance policy, a claim can have a direct impact on your premium the following year, but with group insurance the amount of the premium is based on the total amount of claims made by people insured under the plan. If that total goes up, premiums will increase at the next renewal in order to ensure that the plan remains viable. And that will happen even if you personally made few or no claims.
True or false? The insurer pays our benefits and carries all of the risk for our group.
False. For individual insurance policies, the insurer bears all of the risk, but with group insurance, the greatest share of the risk is taken on by the group of people who are insured. The money to pay your claims comes not from the insurer, but from the premiums paid by everyone who is insured under our APTS group plan. The insurer administers the plan and deposits your reimbursement into your account.
True or false? If we change insurers, we can save on premiums.
False. Over 90% of the value of your premium is used to pay benefits claimed by people insured under the group plan. The other part of your premium covers administrative fees paid to the insurer who manages the plan. If we change insurers, the claims will come with us, which means the impact on premiums will be negligible. Administrative fees are the only area where we have any bargaining power. That doesn’t mean that a call for bids is pointless, but it is important to keep expected benefits in perspective.
True or false? My premiums are higher than my spouse’s, who works in the private sector. That shows that the APTS insurance policy is a lot more expensive.
False. It’s hard to make that kind of comparison. We don’t know the total cost of insurance premiums in the private sector because the employer pays a large proportion, if not all, of the employee premium. (The employer gets tax benefits for doing this). In the public sector, the employer pays less than 25% of employee premiums, and the employee’s share is therefore much bigger. Also, coverage differs from one plan to another (in terms of what professionals you can see, how much you can claim in a given year or for a given treatment, etc.). It’s best not to jump to the conclusion that insurance is cheaper in the private sector.
Premiums effective as of April 1, 2024
Health insurance plan
Premiums will go up as of April 1, 2024, because of a significant increase in health insurance claims, especially claims for mental health medication and care.
The tendency in past years has been for health insurance claims to go up, primarily because of the rising cost and number of drugs prescribed. Prescription drugs account for more than 83% of all health insurance claims, and any fluctuation in this area therefore has an immediate impact on premiums.
Dental insurance
The premium for our dental insurance plan will go up because of the yearly increase in all dental care costs – an increase that is higher than usual this year. The yearly increase is defined by the Association des chirurgiens-dentistes du Québec, which calculates the customary and reasonable costs of the coverage provided by the insurance plan. Costs usually go up by about 5%, but they increased by 9.8% in early 2023. The dental care premium will therefore go up by 7.5% on April 1.
Supplemental plan
Our life insurance and long-term disability insurance plans have gone through some turbulence over the past few years. However, we need to proceed with caution before making any significant changes to the rates for these plans. The premium for each will go up by 5% on April 1. For life insurance, this means a $0.09 increase for every pay period for those earning $60,000 a year, and a $0.12 increase for those earning $80,000. For long-term disability insurance, the increase is $0.90 per pay period for those earning $60,000 and $1.20 for those earning $80,000.