EDCOEBENEFITS WORKSHOP

Jeremy M. Meyers, Superintendent

Coleen M. Johnson, Executive Director, Personnel Services

September 2014

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My own prescription for health is less paperwork and more running barefoot through the grass.

Leslie Grimutter

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Part 1

Understanding Health Care Reform

This information is provided based on our current understanding of the Act; it does not constitute legal advice.

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Implementation of ACA

• The Patient Protection and Affordable Care Act was signed into law March 23, 2010.

• The Act requires:• Every person has health insurance• Insurance meets minimum coverage standards• Insurance must be affordable• Insurance is available to everyone and is available

through employers, state exchanges, or Medicaid.

Implementation of ACA

Some parts of the law have already been implemented, but many regulations are not final yet.

What has already been implemented?

Dependent coverage to age 26. (2010) Lifetime limits. (2010)

Plans no longer have lifetime limits on essential health benefits.

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Implementation of ACA continued

No cost sharing for Preventive Health Services. (2010)

• You and your family may be eligible to receive important preventive services with no co-pay or deductible. Examples include: blood pressure screening, cholesterol screening, type 2 diabetes screening, immunizations.

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Implementation of ACA continued

Employers are required to report the value of employer health plans on W-2 forms (2012 year).

• The amounts reported are not taxable; the reporting is informational only.

Summary of Benefits and Coverage (SBC) must be available to employees to compare health plan offerings. (2012)

• This information can be obtained in our Personnel Services Department or on the CVT website.

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Implementation of ACA continued

PCORI Fees = Patient Centered Outcomes Research Institute

• Plan sponsors must pay a fee to help fund the PCORI based on the average number of covered lives under the plan (2012).

• $2 per covered life• Ends in plan year ending September 30, 2019

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Implementation of ACA continued

State Exchange Notification. (2013)• Employees must receive notification about the state

Benefit Exchange.

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ACA Implementation continued

Health Benefit Exchanges. (2014)• Beginning January 1, 2014, state health insurance

marketplaces began offering coverage options. • These marketplaces are called “Exchanges”.• California’s Health Benefit Exchange is called

“Covered California”.

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ACA Implementation continued

Exchange Reinsurance Fee (2014)• Insurers and plan sponsors must pay reinsurance fees to

Health & Human Services.• Purpose: stabilize premiums in the individual market during

the first 3 years of the public exchange.2014 estimated fee = $63 per covered life2015 estimated fee = $44 per covered life

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ACA Implementation continued

Open enrollment for Covered California began in October 2013. Coverage became effective January 1, 2014.

Individuals will be eligible to receive an advance tax credit (“subsidy”) to purchase from the exchange if their income is between 133% - 400% of the Federal Poverty Level.

Individuals eligible for coverage through employer sponsored plans are generally ineligible for premium assistance tax credits (unless the employer plan does not meet certain criteria).

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ACA Implementation continued

Individual Mandate to Obtain Health Coverage• Beginning January 1, 2014, most people over the age

of 18 are required to have health insurance for themselves and their dependents or pay a penalty.

• This mandate will be monitored by the IRS.

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What’s Next? continued

The Free Rider Penalty

Effective January 1, 2015:

Rule #1:– Employers must offer health coverage to at least

95% of full-time employees (working 30 hours or more per week or 130 hours per month) and their dependents (children up to age 26).

EDCOE already offers health coverage to 100% of its regular employees working 20 hours per week or more.

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What’s Next? continued

Rule #2:• Employers must offer at least one affordable plan that

provides at least 60% of the cost of covered services.• Affordability = an employee’s contribution for employee

only coverage equals less than 9.5% of their income.

All of the plans offered by EDCOE meet this minimum value test of 60% (“actuarial value”). CVT has two plans (Blue Cross and Kaiser “Bronze” plans) that provide this minimum value.

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What’s Next? continued

Health Coverage and Workforce Reporting• Employers will be required to submit detailed reports to

the IRS regarding each employee’s health coverage.

(2015 calendar year – due January 2016)

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What’s Next?

Automatic enrollment• Employers will be required to automatically enroll

newly eligible full-time employees in employer sponsored health coverage.

• EDCOE/CVT already requires full-time employees to enroll in health insurance.

Implementation has been delayed pending final regulations.

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Part 2

CVT Plan Updates

2014-2015

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First let’s review some basic terms…

• Annual Deductible – the amount an employee pays for services before the plan begins to pay

• Co-insurance – the employee’s share of costs expressed as a percent (80/20 plan means the employee pays 20% of the cost for services plus any deductible)

• Co-Pay – a fixed amount paid for a covered service ($20 per office visit)

• Maximum Out-of-pocket – the most an employee pays during the year before the plan begins to pay 100% of the covered amount

• Preferred Provider – a health care provider who contracts with the health insurer to provide services at a discount

Common Terms

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California’s Valued Trust

• EDCOE is a member of California’s Valued Trust (CVT).

• CVT is California’s largest self-funded public schools trust specializing in healthcare benefits for the education community.

• CVT is governed by equal representation from management, CTA and CSEA members.

• CVT Basic Healthcare Information: http://www.cvtrust.org/why

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CVT Changes for 2014-2015

• Rate Increases• Anthem Blue Cross PPO Plans: +1.4 – 4.8%• Kaiser Permanente: +8.6%. • -2.9% for Delta Dental • +2.7% for VSP

• Health care reform fees1 contributed to 1% of the PPO rate increases and 2% of the Kaiser rate increases for 14-15.

1Patient-Centered Outcomes Research Institute (PCORI) Fee and Transitional Reinsurance Fee

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CVT Changes for 2014-2015

• No annual dollar maximums for all covered expenses• Maximum out of pocket (OOP) limits for medical and

pharmacy plans have changed per ACA• ACA yearly limit on cost sharing

• $6,350 for individuals• $12,700 for families• PPO plans - now includes deductibles, coinsurance,

medical, pharmacy co-pays • Kaiser - now includes deductibles, coinsurance,

medical co-pays

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CVT Changes for 2014-2015

• Pharmacy Co-Payment Benefit Enhancement– Available for members participating in Alere or Accordant

Health Management Programs1

– “Pharmacy step down” = reduced pharmacy co-pays for certain condition-related prescriptions for members enrolled in Alere or Accordant Health Management Program

1 Programs designed to support patients with chronic diseases

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Anthem Blue Cross Bronze Plan

• New in 13-14• Offered to meet the requirements for the Affordable Care Act

mandate for minimum coverage• Available to all units in EDCOE

– Deductible: $5,000 individual/$10,000 family– 70/30 coinsurance $6,350 individual/12,700 family– First 3 office visits $60 copay, remaining visits subject to

deductible and coinsurance– Prescriptions are subject to deductible then $25

Generic/$50 Brand– Not compatible with a Health Savings Account

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Kaiser Bronze Plan

• Offered to meet the requirements for the Affordable Care Act mandate for minimum coverage

• Available to CSEA, Charter, Management staff – Deductible: $4,500 individual/$9,000 family– 60/40 coverage after deductible– Calendar year out of pocket max = $6,000 individual

$12,000 family– Prescriptions are not subject to deductible – Generic

covered at 70% (not to exceed $50)– Includes vision care

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Online Benefit Calculator

http://general.edcoe.org/hcc/edcoe19342/SelectGroup.asp

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Delta Dental

Eligible employees – 20 hours per week

100% employer paid premium (for full-time employees)• Basic coverage – 70% of approved fees for covered

services• Copay percentage increases by 10% each year (up to

100%) if enrollee visits the dentist at least once each year• Implants now part of the basic benefit paid at

50%

Delta Dental 866-499-3001

http://www.deltadentalins.com/

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Vision Service Plan

For full-time eligible employees, 100% employer paid premium.*

Basic coverage: ($15.00 copay each plan year)• Exam every 12 months• Lenses every 12 months• Frame every 24 months• Contact lenses - $50.00 copay• Frame allowance is now $150

vsp.com

800-877-7195

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Employee Assistance Plans

Provide free confidential counseling, education, and referral to employees and their family members.• Mental health services• Legal guidance• Financial guidance• Work/life services (referrals for child care, adult care,

academic service providers)

ValueOptions 1-877-397-1032 MHN 1-800-227-1060

https://www.achievesolutions.net https://members.mhn.com

(code: sia)

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• Take advantage of free screenings and immunizations

• Register and use Telemedicine (MDLIVE) for non-emergency situations

• Use the Benefit Calculator to be sure the plan is the best fit for the family based on usage

• Use the Section 125 option for pre-tax premium deductions

• Consider higher deductible plans or

a Wellness Plan

How Can Employees Get the Most for their Money?

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Questions

Coleen Johnson, Executive Director– (530) 295-2219– email: cjohnson@edcoe.org

Sharon Cooper, Employee Benefits Technician– (530) 295-2226– email: scooper@edcoe.org

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Resources

• Blue Cross - https://www.anthem.com

• Covered California - http://www.coveredca.com/

• CVT - http://www.cvtrust.org/

• EDCOE’s benefit calculator –

http://general.edcoe.org/hcc/edcoe19342/SelectGroup.asp

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Resources continued

• Delta Dental - http://www.deltadentalins.com/

• Healthcare.gov - https://www.healthcare.gov/

• Kaiser - https://healthy.kaiserpermanente.org

• Kaiser Family Foundation - http://kff.org/

• VSP - https://www.vsp.com/

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Looking after my health today gives me a better hope for tomorrow.

Anne Wilson Schaef