afspa newsletter 2010 volume 26, issue 1

A Message from the CEOSince the Affordable Care Act was signed into law on March 30, 2010, there has been muchdiscussion on how it will affect the Federal Employees Health Benefits (FEHB) Program.You will find information on this topic throughout this newsletter. Members of the FOREIGNSERVICE BENEFIT PLAN (FSBP) can rest assured that we have reviewed these changes toensure that the plan meets or exceeds all requirements of the new law.

In 2011, the FOREIGN SERVICE BENEFIT PLAN will continue to provide excellent benefitsand competitive premiums. While the average FEHB premium will increase in 2011 by7.3%, the FSBP is pleased to announce that our premiums will increase only on average 6%.In fact, we are only an average of 4.2% more compared to 5 years ago. Additionally, members will enjoy an increase in Plan benefits. Please review some of our benefit changeson page 2 of this newsletter.

In September, we upgraded our IT systems to cloud computing to assist us in providing ourmembers with exceptional customer service. New technology always brings some systemquirks, but overall we experienced minimal interruption to our daily operation and, mostimportantly, service to our members. Over the coming months, members will see even better and faster service from us.

Recently, we announced two new product lines to our membership – a “next generation”Long Term Care insurance policy underwritten by Prudential Insurance Company ofAmerica and a voluntary group Total Disability plan underwritten by Lloyd’s of London.These plans are designed to meet the unique needs of our membership and we hope that youwill take advantage of these opportunities. For more details, see pages 3-5.

As Open Season is fast approaching, it is a great time to review all of your insurance policies to make sure that they still meet your and your family’s needs. If you have had a recent change in your family structure (i.e., marriage, divorce, birth of child, death of afamily member) or have moved, please notify us at AFSPA so we may update our records.

Once again, thank you all for your loyalty to us – we value each and every member who hasput their trust in the Protective Association. I promise that each and every member of theAFSPA staff will work hard every day to keep the commitment we make to our members.

To Your Health,

Paula S. Jakub, RHUExecutive Vice President

NewsletterVol. 26 No. 1October 2010

In this issueSummary of Benefit

Changes for the ForeignService Benefit Plan

page 2

Long Term Care:Why Planning is Important

page 3

A Word about Upgradingyour Long Term Care Plan

page 3

Big Changes Coming to AFSPA’s Dental

Insurance Plans

page 6

Health Care Reform —Dependent Coverage

page 8

Leading Edge Tests —That can Save your Life

page 9

Potential Tax Traps onMedicare B Premiums

page 11

Fall2010

FSBP – 2011 RatesBi-Weekly Premium Monthly Premium

Self Only 401

$56.99

Self & Family 402

$141.31

Self Only 401

$123.49

Self & Family 402

$306.17

AFSPA Newsletter 10-10:Layout 1 10/8/10 12:11 PM

2 Fall 2010

Founded in1929

AFSPA was founded in 1929 “to

promote in all lawful and legitimate

ways, the advancement of the welfare

of its members including the welfare of

their dependents and their designated

beneficiaries.” There are no initiation

fees or dues.

BOARD OF DIRECTORSThomas M. Tracy, Chairman

Richard J. Shinnick, Vice ChairmanSarah R. Horsey, Secretary/TreasurerKathleen Austin-Ferguson, Director

Joan M. Clark, DirectorFrank J. Coulter, Jr., Director

Jan A. Mohr, DirectorPhyllis E. Oakley, DirectorJames D. Whitten, Director

Chief Executive OfficerPaula S. Jakub, RHU

Executive Vice President

Deputy Executive OfficerKenneth A. Messner

Members of the Board of Directors

are Career Foreign Service or other

Executive Branch personnel, on

active duty or retired. They serve the

Association without compensation.

American Foreign ServiceProtective Association

1716 N Street, NWWashington, DC 20036-2902

Phone: (202) 833-4910Fax: (202) 833-4918

E-mail: [email protected] site: www.AFSPA.org

Summary of Benefit Changes for theFOREIGN SERVICE BENEFIT PLANEvery year, the Protective Association announces the benefit enhancementswe have negotiated with the Office of Personnel Management (OPM) for theFOREIGN SERVICE BENEFIT PLAN (FSBP). We are particularly proud of themany enhancements we have made to the FSBP for benefit year 2011. Weencourage you to review the 2011 FSBP Plan Brochure available on theFSBP’sWeb site www.AFSPA.org/FSBP under “Overview”. Section 2 of theBrochure provides details about all the changes. Below are some of the majorenhancements:

• Add coverage for dependent children up to age 26 in compliance with theAffordable Care Act;

• Pay facility and anesthesia charges for a routine colonoscopy for PPOproviders and providers outside the U.S. at 100% of Plan allowance;

• Increase the Home health care benefit from a limited dollar amount for PPOproviders and providers outside the U.S. to a 90% coinsurance (nodeductible) and non-PPO providers to a 70% coinsurance (no deductible);

• Increase the Chiropractic benefit from $40 per visit to $50 per visit;

• Increase the Alternative benefit for acupuncture and massage therapy from$30 per visit to $40 per visit;

• Change the Educational classes and programs benefit to:

n Add a comprehensive Smoking Cessation in compliance with OPM’srequest;

n Increase the Nutritional counseling benefit to $500 per person, per year;

n Increase the Diabetic education training benefit to $500 per person, per year;

n Increase the Weight management benefit to $1,500 per person, per lifetime;

• Expand the list of covered transplants;

• Pay for testing for bone marrow/stem cell transplants for up to four donors;and

• Replace the current Diabetic wellness incentive with a Wellness IncentiveAccount that will include not only Diabetes, but also Coronary ArteryDisease.


3 Fall 2010

Long Term Care: Why Planning isImportant

Even thinking about the possibility ofneeding Long Term Care is somethingthat most people want to avoid. But putting off your decision on this mattermay not be in your best interest.Generally, Long Term Care plans areless expensive when you apply at ayounger age. Planning for your future

Long Term Care costs will help alleviate the uncomfortablefeeling of relying on your children or family members forfinancial support. Purchasing a Long Term Care policy willhelp you keep your assets and preserve the quality of life youworked so hard to achieve.

The Protective Association first offered a Long Term Careplan in 1990 with Mutual of Omaha as the underwriter. Wenow offer a “next generation” Long Term Care plan throughPrudential Insurance Company of America that includes several coverage choices. The Prudential Solid SolutionsLong Term Care plan can serve as your only Long TermCare coverage or be used to supplement your existing LTC coverage under our Mutual of Omaha plan, John Hancockplan, or any other Long Term Care plan. PrudentialInsurance Company of America has been issuing Long TermCare plans since 1986 and has a well known reputation for excellence. AFSPA is pleased to be able to offer thismodern LTC plan to its membership.

In order to qualify for benefits under the Solid Solutions LTCplan, you must be unable to perform two out of the sixActivities of Daily Living (eating, bathing, dressing, generalmobility, toileting and taking medication). Your physicianmust verify your health care needs and develop a Plan ofCare.

Highlights of the Solid Solutions Long Term Care plan:

• Choice in Coverage - Choose a Facility Daily Benefit(FDB) of $100, $150, $200, $250 or $300 per day todetermine a lifetime Maximum Benefit Pool of $109,500to $328,500 (equal to the FDB multiplied by 3 years);

• Elimination Period - 90 calendar days; once per lifetime;

• Cash Alternative Benefit - Gives you the option ofreceiving cash payments (in lieu of reimbursement) forinformal home health care provided by family andfriends in your own home instead of having to move to a care facility. This may be useful, especially to our overseas members;

• Home Support Services - Provides benefits for assistivedevices or technology, caregiver training, medical alertsystems and transportation;

• Tax Qualified Plan - As set forth by Section 7702 of theInternal Revenue Code;

• Worldwide Coverage - Pays 75% of the Facility DailyBenefit for a maximum of 365 days for care receivedoutside the United States; and

• Optional Automatic Inflation Protection - Coverageamount increases by 5% per year, compounded annually.

The Prudential Solid Solutions Long Term Care plan is available to you and your family members, ages 18–84.Eligible family members include spouse, parents, parents-in-law and adult children. Once you purchase a policy, yourrates will not increase due to changes in your age or health.

Please contact us at 202-833-4910 or check our Web sitewww.AFSPA.org/LTC for the complete description of thisplan.

A Word about Upgrading yourLong Term Care Plan

Long Term Care insurance is one of the most importantasset protection vehicles a person can buy. The ProtectiveAssociation began offering the product back in 1990,before most people understood what it was, let alone whythey needed it.

Our first plan was a very solid plan offered by Mutual ofOmaha Insurance Company (Mutual), one of the pioneersin the field. We were, and remain, very impressed with theplan as it provides solid, straightforward coverage at a good premium. One of the most valuable features in the Mutualplan is the Return of Premium feature. If, for any reason,you decide to discontinue your coverage or if you die, a portion of your premium can be refunded to you or to yourestate. The portion refunded depends on the number ofyears your coverage was in force and the amount of anybenefits paid or payable.

As more people became familiar with the concept of LongTerm Care coverage, it was clear to us that one size does notfit all. In an effort to ensure that our members had the bestpossible options, we also sponsored the John HancockLeading Edge and Custom Care plans, two individual plansproviding a wide array of coverage options that were notoffered in the older Mutual of Omaha Plan.


4 Fall 2010

Now, twenty years later, the industry has learned a thing ortwo about LTC and what features people want in a LTCplan. The Protective Association regularly reviews ourproducts to make sure we are offering members the mostcurrent and best plans out there. When Prudentialapproached us with their new LTC product, we were thrilledto put our name on it. This is a “next generation” LTCproduct that provides benefits for the way people use LongTerm Care today.

Now the dilemma – do you have enough protection? Hereare some thoughts.

First of all, LTC is a very difficult product to pin down.What will your needs be in 20 or 30 years?

For many of us, the Mutual LTC plan provides enough coverage, especially with the Automatic Inflation Protection(AIP) rider and the Benefit Increase Option (BIO).

For some of us though, especially if we did not buy the AIPrider and/or did not exercise our BIO option at the 5-yearintervals in which it was offered, the coverage we boughtdecades ago might not be enough. If you feel you are in thiscategory, you have a few options:

• Supplement your Mutual plan (or whichever LTC planyou previously purchased) with the Prudential SolidSolutions LTC plan at a lower daily benefit. These twopolicies combined can provide you with adequate coverage should you need Long Term Care.

• Exercise the Return of Premium feature under yourMutual Long Term Care plan and use the money to payfor a new plan with more modern benefits and cover-age, but at a much higher premium. Depending on howlong you have held the Mutual plan, the amount ofreturned premium may be enough to pay for a new planfor several years.

• Cancel your existing LTC policy and buy a new policywith the additional coverage you need and the benefitsyou want. However, since the monthly premium forLTC insurance is based on the age when you start thepolicy, many members are reluctant to give up the lowerpremiums they now enjoy, even if the new policy offersbetter benefits.

WARNING: Long Term Care plans are medically under-written – meaning you must be reasonably healthy and passthe insurance company’s underwriting standards in orderfor them to approve any new coverage. You will need to fillout another application and answer several health questions.If your health has changed since you first purchased your plan, the insurance company might notapprove your coverage. Before activating the Return ofPremium feature on your Mutual of Omaha plan orcanceling any other plan, make sure you have been

approved for coverage first under the Prudential LTCplan or any new plan for which you apply.

Also, since LTC premium is based on your age at the timeof issue, the premium for any new plan might be much higher than your current plan.

The decision to change or supplement your current LongTerm Care plan is a difficult one – and an individual one.Our advice is:

• Do the math;

• Compare several plans; and

• Talk to your financial advisor.

If you have any questions or would like to discuss youroptions, please contact us at 202-833-4910 or via e-mail [email protected].

AFSPA now Offers Group DisabilityIncome Protection Insurance

If you are an active duty Federal employeeand become permanently and totally disabled, you may be eligible for retirementbenefits from your employing agency.Therefore, it is unlikely that you would wantto pay the premiums for a long termDisability policy that is meant to provideincome replacement due to a permanent disability. However, what would happen ifyou were not permanently disabled, but were

unable to work for an extended period of time due to a seri-ous medical condition or accidental injury and ran out ofsick leave? It’s difficult for most working-age adults toimagine how they would cope if they are unable to work andbringing in no income for several months.

We have developed a plan that fills this gap. Our new Disability plan, underwritten by Lloyd’s of London, is available to Federal employees*, ages 18-64. Consider buying this plan if you are a newly hired employee, do nothave a substantial sick leave balance, or just want some extraprotection. Full underwriting is required so you must complete a short health questionnaire. The underwriters willbase their decision on your answers.

This plan will help you pay monthly expenses, such asrent/mortgage, car loan, or medical bills. It provides youwith 60% of your monthly salary, up to a maximum of$3,000 per month minus other in-force disability benefits.The plan has a 24-month Benefit Period and pays benefitsafter a 45-day Elimination Period has been met. It will coveryou anywhere in the world.


5 Fall 2010

If you want more protection, an Optional Lump Sum Benefitof $250,000 or 5 times your annual salary, whichever is less,is also available. The Lump Sum Benefit is paid after the24-month Benefit Period has been exhausted and you areconsidered totally disabled. You must elect the TotalDisability Option to obtain this additional Lump SumBenefit and pay an additional premium.

NOTE: If you are declared permanently disabled under aFederal retirement system (FERS, CSRS, FSPS, FSRDS,etc.) before you have exhausted the 24-month BenefitPeriod, then your coverage under this plan will terminate.

Another provision of this plan is the Residual Benefit. Ifyou experience a loss of 20% or greater of predisabilityearnings, a portion of the monthly benefit will be payableafter the Elimination Period has been met for (1) the periodof loss or (2) the 24-month Benefit Period, whichever is shorter. A loss of earnings of 80% or greater will be considered a 100% loss.

Premium for this plan will be deducted on a monthly basisfrom your designated financial banking institution by directdebit (you must complete direct debit paperwork whenapplying for coverage).

For more information and faster processing of your application, visit our Web site www.AFSPA.org/disability.Please contact us at 202-833-4910 if you have any questions.

*Plan is available to active duty Federal employees who aremembers of AFSPA. Please see our Web sitewww.AFSPA.org for eligibility requirements.

Are You Taking Prescription Drugswith OTCs?There Could be Potential HarmfulDrug Interactions

Most of us take an over-the-counter(OTC) drug, such as aspirin, vitamins or a nutritional supple-ment. However, when these OTCdrugs are taken with a prescriptiondrug, it is not always safe. In fact,thousands of Americans are hospitalized each year because ofharmful drug interactions. Someexamples are:

• Plavix and Proton Pump Inhibitors (PPIs), such asTagament, Zantac or Prilosec

• Coumadin (Warfarin) and Aspirin

As a medco.com® member, you have a great benefit thatcan help reduce your risk of adverse reactions occurring –the Drug Interaction Checker, available through the MedcoHealth StoreTM. The Medco Health Store is a great sourcefor buying OTC items that you need. It offers you theadded protection of cross-checking for interactions withprescription drugs that you have obtained from Medco.Here’s how it works:

• Once you authorize it at checkout, the Drug InteractionChecker will review your Medco prescription drugrecord against the OTC drugs, vitamins and supplements in your Medco Health Store shopping bag.

• The checker will issue a warning for any potentialharmful drug interactions it detects.

• The decision to purchase the OTC drug is always yours.

• The checker runs only for the logged-in member (notfor family members).

Always be sure to read the product label and utilize theDrug Interaction Checker.

In addition, the Medco Health Store offers thousands of health, wellness and personal care products. Standardshipping is only 99¢ on all orders.

To shop the Medco Health Store and benefit from the Drug Interaction Checker, visitwww.MedcoHealthStore.com/checker.

You will need your medco.com username and passwordwhen you are ready to place your order.

If you are not registered, signing up is simple. With yourMedco member ID number on hand, go towww.medco.com, create your Medco account and choosethe Medco Health Store tab on the Medco Home page.

Expanded Vaccination Benefit—Adult and Childhood

The flu is a respiratory illness caused by a virus. It spreadsfrom person to person and can cause mild to severe symptoms. In the United States, yearly outbreaks of seasonal flu usually occur from autumn through early spring.One of the best ways for preventing the flu is by getting avaccination each year.


6 Fall 2010

Many retail pharmacies now offer seasonal influenza andother vaccines. The pharmacists who give these vaccinationsare fully qualified in vaccine administration.

We are pleased to expand our vaccination benefit to includea $0 copayment to you for vaccines at retail pharmacies that participate in the Medco network. To find a retail pharmacy where you can get the vaccine, call Medco at 1-800-818-6717 or visit www.medco.com. The FOREIGNSERVICE BENEFIT PLAN (FSBP) network includes manyconveniently located large chain pharmacies.

Your local pharmacy may also offer other vaccines under thisprogram in addition to the influenza vaccine, including thosefor:

• Pneumococcal virus;

• Zostavax (Shingles virus); and

• Human Papillomavirus (HPV).

Before going to the drugstore, call first to verify that theyhave the vaccine you need. You should also find out whattimes the vaccinations are available.

Immunize Your Children Against Serious Illness

The FOREIGN SERVICE BENEFIT PLAN wants to remind allmembers who have children that it’s important to get yourchildren immunized before they reach school age.

The Centers for Disease Control and Prevention issued the2010 Recommended Immunization Schedule forChildren Ages 0 Through 6 Years, which has been in effectsince December 2009. The FSBP provides benefits at 100% for PPO providers and providers outside the U.S. forthe Immunizations listed on this schedule, shown below.

Talk to your health care provider to make sure your child ison schedule. Ask him or her about additional immunizationsfor certain high-risk groups. This includes children withongoing medical conditions. To learn more, visit the Plan’sWeb site at www.AFSPA.org/FSBP, click on “My OnlineServices”sm and log in or register for My Online Services.The KidsHealth® link offers a wealth of information to helpyou keep your children healthy.

Big Changes Coming to AFSPA’s Dental Insurance Plans

AFSPA offers several Dental plans for our members. In previous newsletter articles, we havecautioned members to consider the need for Dental insur-ance – any Dental insurance – carefully. Once you makethe decision to buy a Dental plan, AFSPA can provide highquality options for you and your family.

CIGNA PPO – A preferred provider plan (PPO) with anout-of-network option offered to our stateside members.

The 2011 in-network benefits will increase. For memberswho use an in-network dentist:

• The calendar year maximum increases from $1,200 to$3,000 per person;

• Class II and III services are subject to a calendar yeardeductible, which decreases to $50 per person/$150max. per family;

• Class II coinsurance increases from 60% to 80%; and

• Class III coinsurance increases from 40% to 50%.*

Range of recommended ages for all children except certain high-risk groups

Range of recommended ages for certain high-risk groups

Vaccine Birth 1

month 2months

4months

6months

12months

15months

18 months

19 - 23 months

2 - - 3years

4 6years

Hepatitis B Hep B Hep B Hep B

Rotavirus RV RV RVDiphtheria, Tetanus,Pertussis DTaP DTaP DTaP DTaP DTaP

HaemophilusInfluenzae type b Hib Hib Hib Hib

Pneumococcal PVC PVC PVC PVC PPSVInactivatedPoliovirus IPV IPV IPV

Influenza Influenza (Yearly)Measles, Mumps,Rubella

MMR MMR

Varicella Varicella VaricellaHepatitis A

Meningococcal

HepA (2 doses) HepA Series

MCV

2010 Recommended Immunization Schedule for Children Ages 0 Through 6 Years


7 Fall 2010

Members still can use an out-of-network dentist:

• The calendar year maximum decreases from $1,200 to$600 per person;

• Class II and III services are subject to a calendar yeardeductible, which remains at $100 per person/$300max. per family;

• Class III coinsurance decreases from 30% to 25%;* and

• Class IV coinsurance decreases from 30% to 25% andthe lifetime maximum decreases from $1,500 to$1,000.**

* Class III benefits subject to a 12-month waiting period.** Class IV benefits subject to a 24-month waiting period.

CIGNA International – A fee-for-service plan exclusivelyfor our overseas population.

The 2011 benefits are:

• The calendar year maximum increases to $3,000 perperson for services rendered outside the U.S.

• For services rendered within the U.S.:

n The calendar year maximum decreases from $1,200 to$1,000 per person;

n Class I, II, and III services are subject to a calendaryear deductible, which remains at $100 per person/$300 max. per family;

n Class I coinsurance decreases from 75% to 60%;

n Class II coinsurance decreases from 50% to 40%;

n Class III coinsurance decreases from 25% to 20% andbenefits subject to a 12-month waiting period; and

n Class IV benefits subject to a 24-month waiting period.

Clearly, this plan is a true overseas plan intended to providebenefits for services rendered outside the U.S. However, ifyou need the service of a dentist while you are in the U.S. onTDY or Home Leave, we do provide coverage, but at reducedcalendar year maximums and coinsurance levels. Thedomestic coverage is intended to provide members with theoption of using a dentist for routine services, such as cleanings and prophylaxis. We recommend that you use anetwork dentist to take advantage of the negotiated PPO discounts so your benefits go further and you don’t bump upagainst the calendar year maximum so quickly.

Obviously, it is in the best financial interest of the memberwith this plan to take care of their Dental needs outside the U.S.

The biggest advantage of our CIGNA International Plan isthat it is a true overseas plan. Unlike the plans that participate in the Federal Employees Dental and VisionProgram (FEDVIP), our benefits are not subject to overseasfee schedules or out-of-network penalties.

Also unlike the plans in FEDVIP, you do not have to waitfor Open Season to make changes to your Dental coverage.You can enroll or cancel your Dental policy through theProtective Association at any time.

Additional benefits of the CIGNA International plan are:

• Referrals to local, licensed dentists;

• Prepayment by CIGNA of plan benefits to dentists;

• 90% of claims are processed within 10 business days;

• Access to a 24/7 multilingual customer service center;

• Translation of claims is done by CIGNA at no charge to you;

• Reimbursement for services can be deposited into yourU.S. or foreign bank account; and

• Reimbursement can be in any currency.

The Protective Association also offers two additionalDental plans:

CIGNA HMO –A Dental health maintenance organization(DHMO) providing nationwide coverage; and

DentaQuest Access ePPO –A preferred provider plan witha network primarily in the Washington, DC metropolitanarea.

For more information about any of our Dental plans, pleasevisit our Web site at www.AFSPA.org/dental.

Regardless of what plan you decide to purchase, evaluateyour current Dental expenses and determine if it is worthwhile for you to purchase a voluntary Dental insurance plan.

FSBP Members now Have Access to Savings on LASIK Eye Surgerythrough QualSight LASIK!

If you have considered correc-tive eye surgery, take advantageof the QualSight LASIK network. The FOREIGN SERVICEBENEFIT PLAN (FSBP) andCoventry Health Care, the Plan’sunderwriter, are pleased to bring

you this benefit. QualSight LASIK provides FSBP members savings of 40% to 50% off the national averageprice for Traditional LASIK eye surgery. QualSight’s credentialed network of the nation’s most experiencedLASIK surgeons features 800 locations nationwide withover 2.5 million LASIK procedures performed to date.Flexible financing options are available with payments aslow as $50 per month.*


8 Fall 2010

How it Works:

1. To obtain the preferred pricing call 1-877-213-3937.FSBP members residing overseas can contactQualSight through the QualSight Web site to schedulethe procedure during a stateside stay.

2. A QualSight Care Manager explains the program andanswers any questions.

3. Select your preferred provider and set the appoint-ment right over the phone!

To learn more, visit www.AFSPA.org/FSBP and select MyOnline Services. Once you have logged into My OnlineServices, select “Wellness Tools”, “Discount Programs”,then “QualSight LASIK Discount Program”. This will takeyou to the QualSight Web site where you can review detailsof the program and find out how to take advantage of thediscounts.

This is a value-added service available to FSBP membersthrough Coventry. The QualSight program is not an insuredbenefit. The preferred pricing program is available to members to provide access to QualSight preferred pricingfor LASIK surgery.

*Subject to GE CareCredit approval, which is the organiza-tion that provides the financing.

And another New Feature —Savings on Vision Care for FSBPMembers

For our members who reside overseas, plan to take advantage of these discounts when you are in the U.S.

No matter what the age, eye exams are important to health.As we age, our eyes are also at greater risk for sight-threatening conditions, such as cataracts and maculardegeneration. Annual comprehensive eye exams can helpdetect these conditions and many others before the damageis irreversible.

Now, the FOREIGN SERVICE BENEFIT PLAN (FSBP) andCoventry Health Care, the Plan’s underwriter, are pleased tobring you the opportunity to save on vision care. FSBPmembers can save on eyewear through a materials discountprogram offered by EyeMed Vision Care. The EyeMedSELECT network offers the choice of leading optical retailers including LensCrafters, Pearle Vision, SearsOptical, Target Optical, JCPenney Optical, as well as thousands of private practitioners all near where you workand shop. This program is available to all members and eligible dependents and cannot be combined with any other discounts.

You can find a provider at www.eyemedvisioncare.com.On the Home page, select “Locate a Provider” and choosethe “SELECT” network to view your providers. Also, youcan locate providers and review your discount by clickingon the “Members” tab, “Log In/Register”, then click on the letter “C”. Once there, choose “Coventry-FSBP(9244237)”.

To learn more, visit www.AFSPA.org/FSBP and select MyOnline Services. Once you have signed into My OnlineServices, select “Wellness Tools” and “DiscountPrograms”.

Health Care Reform – DependentCoverage

Over the last five months there hasbeen a lot of talk about theAffordable Care Act (ACA), PublicLaw 111-148. As a result of this law,children will be eligible for healthcoverage under their parent’s Selfand Family health plan enrollmentup to age 26.

For those enrolled in the Federal Employees HealthBenefits (FEHB) Program, this provision becomes effectiveJanuary 1, 2011.

The law further states that:

• Married children between the ages of 22 and 26 arecovered, but not their spouses or their own children.

• Children between the ages of 22 and 26 are no longerrequired to be financially dependent or live in the samehousehold as their parents to be eligible for coverageunder their parent’s Self and Family health plan.

• A child is not required to be a student or have prior or current insurance coverage to be placed on their parent’s Self and Family enrollment.

• Children who are eligible for or have their own employer-provided health insurance are eligible forenrollment under their parent’s Self and Family enrollment.

NOTE: This Vision Care Discount Program may be a viable alternative to purchasing a separate visioninsurance plan. As with all supplemental insuranceprograms we recommend that members do the mathand evaluate their individual situation.


9 Fall 2010

• Stepchildren do not need to live with the enrollee in aparent-child relationship to be eligible for coverage upto age 26.

• Foster children are covered until age 26.

If you are enrolled currently in a Self and Family policy andwant to add a child(ren) to your existing policy, you willneed to provide the plan with a copy of the following:

• Child(ren)’s Birth Certificate;

• Child(ren)’s Social Security Number; and

• Address, if different from enrollee.

If you are enrolled currently in a Self Only policy and wishto add a newly eligible or previously enrolled child(ren),you will need to change your enrollment to Self and Familyby completing a Health Benefits Election Form (SF-2809)or electronic enrollment. Upon completion, the formshould be submitted to your employing agency’s humanresources/personnel office.

Making the change to Self and Family can be done in eitherof the following events:

• Change in Family Status – The enrollee may changetheir enrollment from 31 days before to 60 days afterJanuary 1, 2011 under the Change in Family StatusQualifying Life Event (QLE). The change to Self andFamily will take effect on the first day of the pay period that includes January 1, 2011; therefore, thechild(ren) will be covered as an eligible family member(s) effective January 1, 2011.

• Open Season – The change to Self and Family will takeeffect on the first day of the first pay period that beginsin January 2011. For most, this will be January 2, 2011.

OPM has instructed plans to send letters no later than November 1, 2010 to their members. FSBP mailed its letters on October 15th.

NOTE: The change does not apply to FEDVIP (FederalEmployees Dental and Vision Plan).

Leading Edge Tests – That can Save your Life

Less than a decade since the Human GenomeProject, medicine has moved from genetic togenomic: from a few tests for disorders involvingsingle genes to more than 2,000 molecular diagnos-tic tests, letting doctors connect the dots betweenour genes, our environment, and our behavior.

The value of genetic testing today is in predicting how eachindividual is likely to respond to a specific therapy. Thismeans no more one-size-fits-all treatments. Instead, theresults of a simple genetic test let doctors match patients tothe right medication, at the right dose, at the right time. Theoutcomes include:

• Medications that work from the start of therapy;

• Dramatically reduced risks of drug-related adverseevents; and

• Lower overall health care costs.

Medco and FSBP are leaders in adopting personalized medicine testing to guide drug therapies at no extra cost fortheir members. Let’s look at the benefits of three simplecheek-swab tests that touch on large numbers of people inthe general population, including many who have the FSBP:

Tamoxifen (Nolvadex®) is a prodrug, a compound that’seffective only when converted to its active form by enzymesunder the control of a gene known as CYP2D6. For 90% ofwomen with breast cancer, tamoxifen is the right choice fortreatment and prevention. But for the 10% who don’t havethe necessary enzymes,1 the risk of breast cancer recurrence is 30% higher after two years of tamoxifen treatment.2 The good news is that there are several appropriate treatment options for them, and the test letstheir doctors find the right preventive strategy with no time wasted. After getting the results of her tamoxifen testin August, a member e-mailed this message: “I got my results today. Now I have it in writing that I am apoor metabolizer for 2D6. I know not to take tamoxifenbecause it won’t work for me. This test saved my life! Thankyou so much!”

Warfarin (Coumadin®) is the blood thinner most widelyused for stroke prevention. The drug is notoriously difficultto control, as the FDA acknowledged by requiring a “blackbox warning” on the label. Too little: the patient risks a life-threatening blood clot. Too much: the patient suffers astroke due to bleeding. Warfarin causes more emergencyhospitalizations for serious bleeding and stroke than anyother medication. The narrow dose range is governed bytwo genes, CYP2C9 and VKORC1; both can be detected ina single, one-time test. The results allow physicians to pinpoint the correct dose from the start of therapy, oftenavoiding up to six months of dose adjustment along withthe cost of managing adverse effects downstream.

Clopidogrel (Plavix®), a prodrug like tamoxifen, is activeonly when converted by CYP2C19, an enzyme under genetic control in the liver. Clopidogrel is an anti-plateletdrug that prevents recurrent blood-clotting events. It’s avaluable treatment for people who have undergone coronary stenting or suffered a heart attack. About 30%


10 Fall 2010

of people lack the specific enzyme needed to convert clopidogrel to adequate levels of active compound, as theFDA’s black box warning label shows.3,4 Because they havea 30% higher risk of another heart attack or other negativeevent if they take clopidogrel, these patients may need a different anti-platelet medication.4 A cheek-swab test is allthat’s needed to identify a candidate for clopidogrel or tofind a more appropriate treatment for a non-candidate.

Testing is easy and eligible members need not worry aboutordering a test. Medco coordinates testing by contacting amember’s physician for approval and contacts the memberdirectly following physician approval.

The FSBP now covers these personalized medicine tests aspart of the Medco pharmacy benefit, at no extra charge tomembers. The results of a simple, one-time test can tailortreatment options for personalized, innovative health care.

When you qualify, Medco will contact you and/or your physician to enroll you in the program. With yourphysician’s approval, the clinical laboratory will facilitate theprocessing of the pharmacogenetic test and share the resultsof the test with your doctor. The results of the pharmocoge-netic test are for informational purposes only. Any dosing ormedication changes remain in the sole discretion of yourphysician. Your participation is totally voluntary.

The conditions, drugs and testing covered by the programwill change from time to time as new genetic tests becomeavailable that are recommended by the FDA and are included in the program.

For more information on this very important program,please go to the Plan’s co-branded Web site atwww.AFSPA.org/FSBP and click “Manage RX Benefits”or call a Medco customer service representative at 1-800-818-6717.

Term Life Insurance – An EssentialPart of your Insurance Portfolio

Now is a good time to review yourcurrent insurance coverage as Open Season is almost here. Is yourcurrent coverage adequate for yourexisting needs? Have you experi-enced a change in your family situation lately that may require additional coverage? Do you have

Term Life insurance? This insurance is designed to provideyour family with income should something happen to you,the breadwinner of the family.

To figure out how much coverage to buy, determine howmuch income your family will need if you are not aroundanymore. If your spouse is working, look at a policy to supplement his/her income to cover the monthly expenses,such as mortgage/rent, car payments, child care, utilities,etc. Many of you have a Life insurance policy throughFEGLI. Did you know that you lose this coverage whenyou leave government service? While we recommend getting basic coverage with FEGLI, you might find a betterpriced, commercial plan for the additional amount (multiple) of income.

AFSPA sponsors a Term Life insurance policy, underwrittenby Prudential Insurance Company of America (Prudential),where you can obtain up to $300,000 of coverage at a reasonable premium. Unlike FEGLI, you can keep this coverage when you leave government service. It contains noexclusions – war, declared or undeclared, and acts of terrorism are covered. This plan provides coverage duringthose critical earning years. Coverage starts to decrease atage 60 and terminates at age 70. Family coverage is alsoavailable.

For more information, including the application, visit ourWeb site www.AFSPA.org/life or contact us via phone at202-833-4910.

Health Care Reform – FSAFEDS – the Flexible SavingsAccount (FSA) Program for Federal employees:

• 2011 – FSA’s can reimburse over-the-counter (OTC)drugs only if supported by a prescription (excludinginsulin).

• FSA’s still can reimburse for other OTC items, i.e. bandages or contact lens solutions.

• 2013 – FSA’s will be capped at a maximum contributionof $2,500 (instead of the current level of $5,000).

• Contribution cap will be adjusted annually thereafter for inflation.

1Hartman AR, Helft P. The ethics of CYP2D6 testing for patients consideringtamoxifen. Br Ca Res. 2007;9(2):103.

2 Schroth W, Goetz MP, Hamann U, et al. Association between CYP2D6 polymorphisms and outcomes among women with early stage breast cancertreated with tamoxifen. JAMA. 2009;302(13):1429-1436.

3 Mega JL, Close SL, Wiviott SD, et al. Cytochrome P-450 polymorphisms andresponse to clopidogrel. N Engl J Med. 2009;360(4):354-362.

4 Simon T, Verstuyft C, Mary-Krause M, et al. Genetic determinants of responseto clopidogrel and cardiovascular events. N Engl J Med. 2009;360(4):363-375.

Term Life Insurance

Policy

To Þgure out how much coverage to buy,

determine how much income your family

will need if you are not around anymore.

If your spouse is working, look at a policy to

supplement his/her income to cover the

monthly expenses, such as mortgage/rent,

car payments, child care, utilities, etc.

Many of you have a Life insurance policy

through FEGLI. Did you know that you lose

this coverage when you leave government

service? While we recommend getting

basic coverage with FEGLI, you might Þnd

a better priced, commercial plan for the

additional amount (multiple) of income.


11 Fall 2010

Potential Tax Traps on Medicare BPremiums

By Jennifer Lee, Bean Kinney & Korman P.C.Arlington, VA

Medicare Part B is designed tocover doctors’ services, outpatientcare, home health care and somepreventive services. The U.S. government pays a portion of the premiums for beneficiaries ofMedicare Part B. Prior to 2007, theincome of a Medicare beneficiarywas not a criterion for determining

the Part B premium for that individual. The governmentpaid 75% of the beneficiaries’ premiums while the beneficiaries paid the remaining 25%. The MedicareModernization Act of 2003 (the “Act”) changed how Part Bpremiums are calculated for beneficiaries with higherincomes. As a result, the government portion of the Part Bpremium is reduced for beneficiaries with incomes above acertain amount.

Under the Act, the Social Security Administration (“SSA”) calculates the beneficiary’s modified adjusted gross income(“MAGI”) based on the most recent tax information provided by the Internal Revenue Service (“IRS”).Generally, this means that the premiums for any given yearare calculated using income figures from two years prior tothe year at issue. For example, to calculate a beneficiary’s2010 monthly premium, the SSA will use information fromthe beneficiary’s tax return filed in 2009, reflecting incomefor tax year 2008. MAGI is calculated as the combinationof a beneficiary’s taxable adjusted gross income and tax-exempt interest income earned from that year.

Individuals with MAGI above $85,000 or married couplesfiling jointly with MAGI above $170,000 will have to payan Income-Related Monthly Adjustment Amount(“IRMAA”). The total Part B premium paid for these individuals will be equal to the basic Part B premium plusthe IRMAA.

Since a beneficiary’s Part B premium is recalculated on an annual basis, it is important to keep in mind that anyincome earned in a given year can affect the calculation offuture Part B premiums. For example, if a beneficiarycashes out his or her annual leave upon retirement or cashes out an IRA in 2010, this will cause a spike in taxableincome for this year. If the spike causes the beneficiary’sincome to rise above the MAGI threshold for the basic PartB premium, the beneficiary will have to pay an increasedPart B premium in 2012. To avoid this potential result,

beneficiaries should consider timing of income-generatingtransactions, including distributions from retirementaccounts or sale of property.

Beneficiaries who are subject to the increased Part B premium normally receive a letter from the SSA explaininghow the determination was made. Beneficiaries shouldreview the information used by the SSA in its determinationto ensure that the information is accurate.

A beneficiary may request a new determination from theSSA if one of the following five situations apply:

• beneficiary experienced a qualifying life changingevent;

• beneficiary wishes to request that the SSA use information from an amended tax return;

• erroneous information was provided to the SSA by theIRS;

• the SSA used three year old tax information and twoyear old information is available; or

• beneficiary has a change in living arrangements.

If none of the above situations apply, but the beneficiary disagrees with the SSA’s determination, the beneficiarymay appeal the IRMAA, in which case the beneficiaryshould submit a “Request for Reconsideration” form (FormSSA-561-U2) within a specified time of receiving theSSA’s initial determination notice. If the beneficiary disagrees with the SSA’s Reconsideration decision, he orshe can request a hearing before a Medicare AdministrativeLaw Judge within a specified time of receiving theReconsideration decision by submitting a “Request forHearing by Administrative Law Judge” form (Form HA-501-US), along with an “Authorization for SSA toDisclose Tax Information for Your Appeal of Your MedicarePart B Income-Related Monthly Adjustment PremiumAmount” form (Form SSA-54).

Additional information on the initial determination andappeals process can be found in the SSA’s ProgramOperations Manual System, which is available online athttps://secure.ssa.gov/apps10/poms.nsf/subchapterlist!opeview&restricttocategory=06011.

NOTE: Bean Kinney and Korman is one of the law firmsthat participate in AFSPA’s Legal Services Program.Attorneys who participate have agreed to provide AFSPAmembers legal services at preferred rates. Please go to ourWeb site www.AFSPA.org and click on the “AFSPAServices” tab and then “Legal Services” for more information.


1716 N Street, NWWashington, DC 20036-2902

AMERICAN FOREIGN SERVICEPROTECTIVE ASSOCIATION

Statement of Financial PositionDecember 31, 2009

ASSETSCash & cash equivalents $ 83,165FEHB reimbursement receivable 289,915Accounts receivable & prepaid expenses 488,120Investments, market value 1,092,915Escrow deposits 90,630Property, plant & equipment, netof depreciation 3,414,721

TOTAL ASSETS $5,459,466

LIABILITIES & NET ASSETSAccounts payable & other liabilities $ 267,401Deferred premium revenue 779,952Mortgage payable 1,058,056Line of Credit 150,000

TOTAL LIABILITIES $2,255,409

NET UNRESTRICTED ASSETS $3,204,057

TOTAL LIABILITIES & NET ASSETS $5,459,466

NOTICE OF ANNUAL MEETING

The 2010 AFSPA Annual Meeting will be heldat the Pan American Health Organizationlocated at 525 23rd Street, NW, Washington,DC on January 6, 2011 at 12:00 pm (noon) inRoom B. Please join us to find out about oursuccessful year.


afspa newsletter 2010 volume 26, issue 1

Documents

plan benefits

foreign service benefit

self family

benefit changeson page

insurance policies

afspa newsletter

new law

faster service