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Welcome!
Assurant® Self-Funded Health Plans
Why Self Funded?
• Equip you to capitalize on a new opportunity to help your clients — and grow your block of business — a way to offer:
– More options for existing clients who are facing rising health care costs
– An alternative for new clients — a way to differentiate yourself from your competition
Impact on Small Group Market Younger and Healthier Workers
Premium Factor Austin, TX– Average existing monthly premium $1806– Elimination of group size rating facto 1%– Elimination of health status rating factor 19%
Elimination of gender rating factor 21%– Impose 3:1 age rating constraint 39%
– Increase to 60 Actuary Value 14%– Required new benefits (EHBs) 1%– Tobacco Use Rating Factor -3%– Elimination of other allowable rating factors 2%– Change in the Risk Pool 1%– Miscellaneous new rules 0%– New taxes & fees 3%– Transitional reinsurance contributions 2%– Impact of exchange on operating costs 1%– Average new monthly premium $4,346– Average percentage increase/decrease 141%
Impact on Small Group Market Older and Less Healthy Workers
Premium Factor Austin, TX
– Average existing monthly premium $14,148– Elimination of group size rating factor 1%– Elimination of health status rating factor -30%
Elimination of gender rating factor -2%– Impose 3:1 age rating constraint -3%
– Increase to 60 Actuary Value 0%– Required new benefits (EHBs) 1%– Tobacco Use Rating Factor 13%– Elimination of other allowable rating factors -6%– Change in the Risk Pool 1%– Miscellaneous new rules 0%– New taxes & fees 3%– Transitional reinsurance contributions 1%– Impact of exchange on operating costs 0%– Average new monthly premium $10,790– Average percentage increase/decrease -24%
Small group: Big market, great opportunities
• Nearly 20 million Americans work in groups with 10-49 employees*
• 60% of the U.S. population (approximately 187 million people) have employment-based health insurance**
• Over 70% of businesses with 10-49 workers offer health benefits to their employees**
*U.S. Census Bureau, Survey of Small Business Owners**Kaiser Family Foundation Employer Health Benefits 2011 Annual Survey
• State by state, laws vary and often don’t benefit small businesses
• Today’s small-business owner needs help!
Times are tough
Assurant® Self-Funded Health Plans
Assurant Self-Funded Health Plans
Ideal for:• Small groups with 15 to
50 employees:– Tired of paying high premiums
for benefits they seldom use– Looking for a way to get
something back for what they pay into their health plan
– Sick of seeing the same spreadsheet from most brokers
– Ready to take control over health care costs now and for years to come
Self funding
• Cost-saving alternative to traditional health insurance
• Reduced cost- Essential Benefits not mandatory- No MLR requirements- Avoid community rating
• Major medical health benefit plans that are established by the employer and include:
– A claims fund (funded by the employer)– Stop-loss insurance
Self funding
• Most groups pay less:– Immediately
– Medically underwritten
– Follows federal ERISA guidelines
– Year after year– Greater control over
health care costs– Potential cash back
each year– More commonality in
the future
Assurant Self-Funded Health Plans
Make self funding easy
• Complete package — all the products and services needed to make self funding work:– Tools to build a health benefit plan– Stop-loss insurance– Plan administration
• One monthly bill covers all products and services
• All the details are taken care of– Employer is free to focus on his or her
business
Assurant Self-Funded Health Plans
Make selling easy
• We’ve done all the upfront work — so your clients get:– A distinctive, relevant solution for small
businesses – A complete and integrated self-funding
program– Quick quotes– Experienced advice– Reliable and fast underwriting– More opportunity to make more money
Assurant Self-Funded Health Plans
Unique features
• 1099 employees are eligible• Full time can be 20 to 40 hours per week• Can cover employees at multiple
locations– Do not need to have the majority of
employees within the state of issue– Up to four distinct plans per group with local
and national network options
• Four tier rates• Number of children impacts rates
Assurant Self-Funded Health Plans
Plan flexibility
• Employers are free to choose and pay for the benefits that are most important to their group
• Many options for tailoring a health benefit plan
• Employers can select different options each year as their group’s needs change
• This means their plan will continue to fit their group and their budget year after year
Assurant Self-Funded Health Plans
Pre-determined costs
• The maximum self-funding cost for the year is determined up front — and it’s guaranteed, subject to enrollment and benefit changes
• Employers pay a flat monthly bill — typically less than what they’d pay for a comparable fully insured plan
Assurant Self-Funded Health Plans
Protection of assets
• Even if a group’s claims become larger than projected, the employer’s financial risk does not increase
• Stop-loss insurance steps in to take care of the remaining claims costs for the year, protecting the business’ assets
Assurant Self-Funded Health Plans
Predictable cash flow
• Employers will never have to pay more in a given month than they’ve planned for
• Any month in which claims exceed the current balance in the claims fund, Assurant Health advances to the claims fund the extra funds the group needs for that month
Assurant Self-Funded Health Plans
Potential for cash back
• If a group’s actual claims expenses for the year are less than the amount set aside in the claims fund, the employer gets money back
Plan administration
• Customer service• Claims processing• Plan accounting• COBRA and HIPAA
administration and compliance– Free COBRA administration for all groups of
five and more
• Reporting to you, employer and plan members
Assurant® Self-Funded Health Plans
Health Benefit Plan
Benefit plan design options
• Plan options: Classic PPO, HRA and HSA
• Deductibles from $500 to $10,000• Benefit percentage options of 100%,
90%, 80%, 70% and 50%• Coinsurance out-of-pocket maximums
from $0 to $10,000• Office visit copay options of $20
PCP/$35 Spec, $35/$50 and $40/$60• Prescription drug copay options
Available benefits vary by state.
Prescription drug benefits
• Retail pharmacy copay options:– $15/$45/$60– $20/$50/$75
• Mail order (up to 90-day supply) copays:– $45/$135/$180– $60/$150/$225
• Optional brand name deductible– $300 per person/$600 per family with the
$15/$45/$60 option• $15 generic copay (brand not covered)• No copay — subject to deductible and
coinsurance
Other benefit highlights
• Preventive care paid at 100% for services by network providers
• Outpatient diagnostic x-ray and lab services – Option to have paid at 100% with Classic PPO
and HRA plans
• Urgent care visits– $50 urgent care copay for plans with an office
visit copay
• No referrals necessary to see a specialist
Sample proposal
Assurant® Self-Funded Health Plans
How the package works
Plan payment
• Employer pays one monthly bill – Amount is determined up front and won’t
change for a full year, unless benefits or enrollment changes
• Monthly payment includes:– Contribution to the group’s claims fund
– Covers the group’s expected claims for the year
– Premium for stop-loss insurance– Insurance protection for the employer covers
larger-than-expected claims
– Administration fee– Covers services of third-party administrator,
Allied Benefit Systems, Inc.
Claims payment
• Initial claims are paid from the group’s claims fund, funded by portions of the monthly premium payments
• If claims exceed the amounts expected, the stop-loss insurance takes care of the additional claims for the rest of the year
• If claims do not exceed the amounts expected, any unused funds can either be:– Applied to the monthly bill– Refunded to the employer(Most groups end the year with unused funds)
Cash advances
• Occur when claims submitted total more than the amount currently in the claims fund
• “Paid back” automatically by subsequent contributions to the claims fund
• Helps alleviate concerns about cash flow
Stop-loss insurance
• Specific stop-loss – Protects when the claims for a single group
member exceed a selected limit– Limit options are $10,000, $15,000, $20,000 and
$25,000– If this limit is reached, we pay all remaining
covered claims for the group member for the year
• Aggregate stop-loss– Protects when the total claims for the group exceed
a predetermined limit– Limit is based on expected claims– If this limit is reached, we pay all remaining
covered claims for the group for the year
Under $10,000 is Paid by the PlanOver $10,000 is Paid by Assurant
Health
$0
$2,500
$5,000
$7,500
$10,000
$12,500
$15,000
Ee1 Ee2 Ee3 Ee4 Ee5 Ee6 Ee7 Ee8 Ee9 Ee10
Example of Specific and Aggregate
On left, claims not paid by stop-loss (in blue) are summed together. On right, the amount greater than the aggregate attachment point ($30,000) is paid by the insurance company as aggregate stop-loss (in green)
Claims are summed Over $30,000 is paid by Assurant Health
$0
$10,000
$20,000
$30,000
$40,000
$50,000
Group Total AggDeductible
Refund example
Under $15,000 is paid by the plan
Over $15,000 is paid by the stop-loss insurance
$0
$5,000
$10,000
$15,000
$20,000
$25,000
CP1 CP2 CP3 CP4 CP5 CP6 CP7 CP8 CP9 CP10
Claims Fund & Refund
$0
$10,000
$20,000
$30,000
$40,000
$50,000
Claim Fund Contribution Refund (green) / Claims (blue)
Claims Fund & Refund
$0
$10,000
$20,000
$30,000
$40,000
$50,000
Claim Fund Contribution Refund (green) / Claims (blue)
Agent Compensation
Paid on annual premium equivalent:
• 5.5%
Level commission for subsequent plan years.
Weekly EFT payments.
Standard agent compensation
New Business Submission, Underwriting and Reissue
Underwriting and reissue process
• Medically underwrittenNot guaranteed issue
• Retention Specialists available to assist with plan options
• Rates are based on future risk
Reissues
• Not a renewal
• Handled by gmretention.com
• Sent out by Allied - 60 days
Additional information
• Employers must have 75% of all participating employees excluding those waiving with other coverage, also 50% or total employees
• In groups smaller than 20, Medicare is primary on employees age 65 and older
• Because this is an ERISA plan subject to federal regulation, state mandates do not apply
Allied Benefit Systems, Inc.
Contact Information and Online Services
Allied Transition
• Founded in 1980.
• Allied managed over 2 billion dollars of health care expenses on behalf of clients.
• Allied has 225 professionals with corporate offices in Chicago.
• Allied is considered one of the premier administrators in the country providing professional services to school districts, hospitals, governments, Labor Union Plans, and single employer plans throughout the United States.
• Allied is a licensed TPA in all states and meets all bond requirements.
Allied at a Glance
60+ nationally recognized networks 11 Pharmacy Benefit Managers
Strategic Partnerships
Allied Online AlliedBenefit.com
Member Features• Enrollment• Eligibility Status• Eligibility Management• Claim Status• Plan/Benefit Information• Medical Information Reference • Library• Reporting• Search for Network Providers• Custom E-mail Notification • Hospital Cost Estimator • Hospital and Physician Comparison Tools • Rx Estimator
Key Techology enhancements:
• edelivery of fulfillment materials• Agent access to:
– Online plan documents– Employer Reports
• Improved Billing– Automatic debit of account option– Credit Card option– 3 late reminders vs. 1– edelivery of invoice
Allied Transition
7:30am - 7:00pm8:00am - 5:00pm9:00am - 12:00pm
Monday - Thursday
Friday
Saturday
Customer Service Hours
(Central Standard Time)
Member Service Commitment
Alliedbenefit.com 24/7/365
Employer Fulfillment process
Within 2 days of underwriting approval, Allied will email the employer with a copy to the agent the following:•Welcome letter•Information about how to access all of their plan documents including temporary ID cards for employees online.
Employee Fulfillment processWithin 5 days of underwriting approval, Allied will mail the employee the following:•Welcome letter•Laminated ID cards•Information about how to access all of the following information on the website:
– Plan documents – Provider information– Drug comparison information– Providers in their network– Claim status/EOB
–
•View service documents• Access preferred provider network links• Access pharmacy provider link
With Allied online access, agents can:
• View monthly invoices• View standard monthly reporting• View service documents• Preferred provider network links• Pharmacy provider links
Employers have access to:
Group Name: R0000001 ABC Construction
Agent/Broker/Consultant: Jane Broker Effective Date: 3/1/2007Stop Loss Carrier/MGU: John Alden Life Insurance Company Provider Network: Cofinity
Contract Basis: 12/18 Coinsurance (In/Out Network): 80% / 60%
Minimum State Specific Deductible: $15,000.00 Policy Year: Year 1
1 2 3 4 5 6 8 9 10
Mth/YearNo. of Empl.
Employer PreFunded Claim -
Billed
YTD PreFunded Claim Fund
Claims Paid Subject to the Loss Fund
YTD Claims Paid Subject to the Loss
Fund Specific Claims
Paid Aggregate Claims
Paid Employer Prefund Claim Fund - Paid
Mar-07 32 4,623.00$ 4,623.00$ 20.00$ 20.00$ -$ -$ 4,625.00$
Apr-07 30 4,397.76$ 9,020.76$ 467.59$ 487.59$ -$ -$ -$
May-07 33 4,735.86$ 13,756.62$ 6,143.69$ 6,631.28$ -$ -$ 9,133.62$
Jun-07 45 6,088.26$ 19,844.88$ 1,475.70$ 8,106.98$ -$ -$ 6,088.26$
Jul-07 46 6,200.96$ 26,045.84$ 1,073.99$ 9,180.97$ -$ -$ 6,200.96$
Aug-07 49 6,539.06$ 32,584.90$ 14,116.55$ 23,297.52$ -$ -$ 6,539.06$
Sep-07 47 6,313.66$ 38,898.56$ 11,918.03$ 35,215.55$ -$ -$ 6,313.66$
Oct-07 46 6,200.96$ 45,099.52$ 3,324.97$ 38,540.52$ -$ -$ 12,289.22$
Nov-07 45 6,088.26$ 51,187.78$ 422.62$ 38,963.14$ -$ -$ 5,623.34$
Dec-07 42 5,623.34$ 56,811.12$ 4,263.24$ 43,226.38$ -$ -$ 4,270.94$
Jan-08 30 4,270.94$ 61,082.06$ 435.84$ 43,662.22$ -$ -$ 3,946.14$
Feb-08 29 3,946.14$ 65,028.20$ 3,795.50$ 47,457.72$ -$ -$ -$
Mar-08 0 -$ 65,028.20$ 11,816.09$ 59,273.81$ -$ -$ -$
Apr-08 0 -$ 65,028.20$ 37,042.54$ 96,316.35$ 30,573.05$ 775.64$
May-08 0 -$ 65,028.20$ 62.00$ 96,378.35$ -$ -$ -$
Jun-08 0 -$ 65,028.20$ (6.36)$ 96,371.99$ -$ -$ -$
Jul-08 0 -$ 65,028.20$ 292.33$ 96,664.32$ -$ 158.57$ Aug-05 0 -$ 65,028.20$ -$ 96,664.32$ -$ -$ -$
TOTAL 65,028.20$ 65,028.20$ 96,664.32$ 96,664.32$ 30,573.05$ 934.21$ 65,030.20$
Claim Fund Total YTD (Col 10) 65,028.20$ Claims Paid YTD (Col. 6) 96,664.32$
Net Prefund Claims Account YTD (31,636.12)$
Example of the employer monthly reporting
• View EOBs• Track deductible and out of pocket costs• View service documents• Preferred provider network links• Pharmacy provider link• Request ID cards
Employees have online access to:
Allied HRA at a Glance:
The Allied HRA System can accommodate many options. Including: Roll Over optionsIndividual or Family Maximums Upfront HRA deductibles Pay HRA dollars directly to the Employee or to the
Provider, based on the Employer Group’s chosen option.
Allied HRA at a Glance:
Allied’s HRA Product is tied directly to the Employer Group’s Medical Plan.
The HRA adjudication is systematically completed. Requires no manual submissions by the Employee.
Reporting Capabilities: Members: Claims Detail & Balance Reports Employer: Individual Balance Report & HRA Claim Summary
Report Administration Fee: $5.00 PEPM (no member minimum) HRA Set-up Fee: Waived
Allied HRA at a Glance:HRA Funding Process:Employer Groups will set-up a bank account designated for the HRA funding.The HRA reimbursements will be processed weekly on Wednesdays.The Employer Group will receive a check register from the Allied Funding Department detailing the HRA reimbursements processed for the week.The Employer Group has two options to release reimbursement checks:
Auto Release: The checks will automatically be sent out Wait to Release: The checks will not be sent until the
Employer Group has authorized Allied that the funds are available.
Summary of Allied’s HSA Administrative Services:Initialize set up with Mellon BankProvide communication and enrollment materialsEnter eligibility data into systemTransfer eligibility to Mellon BankProvide access to customer service unit
Health Savings Accounts (HSA)
There are two ways an HSA participant can access funds:
Use HSA checks provided by Mellon Bank Use HSA Debit Card provided by Mellon Bank
HSA Employer Billing: Employer Groups will receive a monthly bill from Allied for
administrative services. Included in the bill is a roster of all plan participants.
Allied will also bill the Employer Group for the monthly service charges by Mellon Bank.
Health Savings Accounts (HSA)
HSA Plan Administrative Fees:Allied Benefit Systems, Inc.
Annual Administrative Fee $500.00 Monthly Administrative Fee $1.50 PEPM
Mellon Bank Employer Fees - Monthly Service Charge per Account 1) Paid by Employer $2.25 2) Paid by Employee Average balances of less than $1,000)
$3.50* *Waived if active employee of participating employer.
Other Fees. (Employee) Replacement / Additional Debit Card $5.00
(first 2 cards issued at no cost) Checkbook Reorder Fee $5.00 Copy of Check, Statement or Other Document (per item) $5.00 Stop Payment Order (per request) $25.00 Returned Item (per instance) $25.00 Custodian Check Issuance Fee (deducted form HSA balance) $25.00 Excess Contribution Reimbursement (deducted from HSA balance)
$25.00 Attachment/Levies/Legal Requests/Subpoenas (per request)
$75/request
Health Savings Accounts (HSA)
• Customer Care Hotline888.292.0272
• Websiteassurantselffunded.com
Dedicated customer care
Thank you
For agent use only. Not for distribution to consumers. Assurant Self-Funded Health Plans is a program of services developed by Assurant Health for self-funding small group employers. Stop-loss insurance for these self-funded plans is underwritten and issued by Time Insurance Company and John Alden Life Insurance Company.J-71968 (Rev. 9/2012) © 2012 Assurant, Inc. All rights reserved.
