Insurance Coverage:Knowing What You Have

and How to Keep It

Sally McCarty

Orlando, Florida

June , 2008

Know Your Health Plan

Traditional Indemnity? PPO? HMO? Employer Group? Small Employer Group? Individual? Other Type of Coverage?

Traditional Indemnity Plans

Reimburse enrollees for covered expenses incurred due to sickness or injury.

Expenses are reimbursed after:– coinsurance (percentage share of cost for which

the enrollee is responsible) and– deductible (annual amount of out-of-pocket that

must be paid by enrollee before benefits begin)

amounts are met.

Preferred Provider Organization

Payment mechanism is the same as traditional indemnity.

Expenses are reimbursed after coinsurance and deductible amounts are met.

Coinsurance is higher when services are provided outside of plan’s provider network.

No referral process is required.

HMO

Enrollees must choose a physician as their primary care physician (PCP).

Founded on the premise that covering preventive care while controlling costs will result in better health care and lower rates of health care inflation.

PCP is the "Gatekeeper" for all medical services.

Employer Group

Subject to HIPAA protections– Limits to pre-existing condition exclusions– Non-discrimination provisions apply– More…

If more than 20 employees, subject to COBRA If Small Employer Group, subject to HIPAA

Guaranteed Issue

Non-Discrimination Provisions

Under HIPAA, you can’t be charged more or removedfrom a group plan due to: Health status Genetic information Claims experience Receipt of health care Medical history Evidence of insurability Disability Medical condition -physical & mental illness

Individual (Non-Group) Coverage

Coverage that is sold by health insurance issuers or HMOs to individuals/families who are not part of a group health plan.

Might be provided through an association or other group, such as college students or self-employed individuals.

Only HIPAA Protection is guaranteed renewability.

Options When Losing Coverage

COBRA Florida Small Group Conversion Policy Trade Adjustment Assistance HIPAA Eligible – guaranteed issue of an

individual policy or a group conversion policy Self-employed (one-life groups) open

enrollment

COBRA

Are you eligible for COBRA?– Your employer has 20 or more employees– Employment terminates for other than gross misconduct– 102% of Total Premium (Employer + Employee share)– 18 months of coverage – up to 36 in some circumstances– Qualifying event:

Spouse of employee who becomes eligible for Medicare Divorce or legal separation from covered spouse Death of covered spouse Loss of dependent child status under plan rules

– 60 Days to Sign Up

Florida Small Group Conversion

If your employer has fewer than 20 employees– By Florida law, you have a right to pay

for continuation coverage for 18 months.

Trade Adjustment Assistance

A federal law called the Trade Adjustment Assistance Reform Act may pay 65% of the cost of your health insurance for up to 3 years:– If you recently lost your job because of imports or

jobs moving overseas, – If you are a retiree aged 55 or older, your former

employer no longer provides your pension, and your pension benefit is paid by the federal Pension Benefits Guaranty Corporation,

HIPAA Federally Eligible

1. At least 18 months of continuous creditable coverage. 2. Most recent coverage under a group plan.3. Not eligible for another group health plan. 4. Most recent coverage not cancelled due to

nonpayment of premiums or fraud.5. Not eligible for Medicare or Medicaid.6. COBRA or state continuation coverage exhausted.7. Did not accept a conversion or short-term limited

duration policy.

Florida HIPAA Eligibles

Leaving a Group Plan– Employer required to offer a conversion plan– Premium can be up to 200% of standard risk– Benefits determined by Florida regulation

Carriers in the individual (non-group) health insurance market must guarantee issue their two most popular currently marketed plans to HIPAA-qualified persons leaving a self-funded plan.

Self-employed Guarantee Issue

Florida requires its small group carriers (e.g., carriers selling health insurance in the small group market) to: – Offer insurance on a guaranteed issue basis

each August to self-employed individuals (one-life groups)

– The carriers can charge up to 150% of their standard rate for these individuals.

ASSESS YOUR NEEDS

Which benefits are the most essential for you or your family?

Does the plan provide access and adequate coverage for the specialists and the specific treatments you and your family need? – Will the location of the plan’s network doctors make

transportation an issue?

How is Factor Covered?

Is Factor coverage a medical or pharmacy benefit? If a pharmacy benefit, are there separate annual

benefit caps for pharmacy? If a pharmacy benefit, are there separate benefit limits,

out-of-pocket maximums, or copayments for factor? If a medical benefit, are there separate benefit limits,

out-of-pocket maximums, or copayments for specialty injectables?

Under either option, what are the coinsurance percentages or co-payments for clotting factor?

Insurance Needs for Families Dealing with a Bleeding Disorder

INCREASE OR ELIMINATE LIFETIME CAPS.The average $1 million lifetime cap established by

the insurance industry in 1970 would equal $18 million today if indexed for inflation

ASSURE THAT OUT-OF-POCKET MAXIMUMS (OOPs) APPLY TO SPECIALTY INJECTABLES.

20% coinsurance with no OOP will certainly drain an average family’s savings without a limit on OOPs for that category

Insurance Needs, continued

Access to:– Medically prescribed and cost efficient health care– Exact brand and quantity of clotting factor

prescribed by physician– Other necessary ancillary services necessary for

optimum care– Providers who follow minimum standards of care in

handling and delivery of factor and other health care services

Be Alert For:

Insurers cutting costs by:– Tiered Drug Plans– Separate Out-of-Pocket Maximums or

Annual Caps for Specialty Injectables– Additional restrictions on provider networks,

especially pharmacy/home health providers– Many other “creative” means to cut costs are being

employed – especially by ERISA plans

Need Help?

Health Plans: Florida Office of Insurance Regulation

– Toll Free:1.800.342.2762

– Web Site: www.floir.com.

Self-funded ERISA plans: www.dol.gov/ebsa Click on one of the following: Compliance Assistance Consumer Information FAQs Contact Us

Need Help?

U.S. Department of Labor’s “Frequently Asked Questions about COBRA Continuation Coverage” – Web site:www.dol.gov/ebsa/faqs/faq_consumer_cobra.html – Toll free 1.866.275.7922

Need Help?

Trade Adjustment Assistance Act – Health Coverage Tax Credit (HCTC)

Customer Contact Center: Toll-free 1.866.628.HCTC Web site:

www.irs.gov/pub/irs-utl/hctc_program_kit_07-05.pdf.