2011 health insurance benefit plan overview
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2011 Health Insurance Benefit Plan Overview
Presented to the Employees of:
Presented by:Scott M. Stevens, RHU,CDHCEmployee Benefits/CDHC Specialist
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INSANITY: “doing the same thing over and over
again and expecting different results.”
Albert EinsteinUS (German-born) physicist (1879 - 1955)
Introducing Douglas County’s 2011 Consumer Directed Health (CDH) Plan Option
Qualified High Deductible/Health Savings Account (HSA) Health Plan
Deductible – Individual $3,000
Deductible – Family $6,000
Coinsurance (PPO/Non-PPO) 0% PPO/ 50% Non-PPO
Preventive Care 100%, no copay or deductible, no limit
Tax Free Contribution to Employees(Based on coverage 1/1/11-12/31/11)
$500 (Employee Coverage)$1,000 (Employee + Dependent(s)) Cov.
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“Consumer-Directed” Healthcare
What’s the theory behind “Consumer-Directed" health care, a new trend in health benefits design?– Introduces people to the actual cost of medical
care– Encourages shrewder purchases of medical
services, diagnostic tests and prescription drugs – Helps hold down the rising cost of health
insurance
Components of CDH…
Preventive Care Benefit• Covered services are paid at
100%.
• no deductible or coinsurance for healthcare deemed and coded as preventive in nature, provided by a network provider
• e.g., routine annual exam, mammogram, pap smear, colorectal cancer screening, cardiac stress tests, immunization, radiology/X-ray, pathology/lab,etc.
• Vision and Hearing exams
TraditionalPlan
QHD/HSA Plan
Copay $30 $0
AnnualLimit
$500 None
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Plan ComparisonPlan ComparisonTraditional vs. QHDHP/HSATraditional vs. QHDHP/HSA
Plan ComparisonPlan ComparisonTraditional vs. QHDHP/HSATraditional vs. QHDHP/HSA
Traditional Plan ($1000/$2000)Copays:
Office Visit:$30Prescription Drug: $15/$30/$60Facility (ER/UC): $250/$50
Annual DeductibleIndividual: $1,000Family: $2,000 (imbedded)
Coinsurance Out of PocketIn/Out Network: 80%/60%Individual (PPO): $2,500 Family(PPO): $5,000
Total Out of PocketIndividual = $3,500 + copaysFamily = $7,000 + copays
QHD/HSA Plan($3000/$6000)
Copays:Office Visit: N/APrescription Drug: N/AFacility (ER/UC): N/A
Annual DeductibleIndividual: $3,000Family: $6,000 (aggregate)
Coinsurance Out of PocketIn/Out Network:100%/50%Individual (PPO): $0Family (PPO): $0
Total Out of PocketIndividual = $3,000 - HSAFamily = $6,000 - HSA
Comparison of Potential Annual Plan Costs
Employee: $3,500+ $2,500-
Employee & Dependent(s): $7,000+ $5,000-
Notes:
*copays for Rx, Office Visits, ER, and UC continue to apply.
** Employee HSA deposits would reduce these amounts
QHD/HSA Plan**Traditional/PPO Plan*
After Douglas County’s HSA Contributions ($500 Employee/$1,000 Employee + Dependent(s))
Douglas County’s CDH Plan Option Combines Health Insurance with a Bank/Spending Account
HEALTH INSURANCE (Qualified High Deductible
Health Plan)
SPENDING ACCOUNT (HSA)+
Premium and HSA Contributions – (total cost, before Douglas County contribution)
Coverage Coverage StatusStatus
Traditional Traditional Plan – Per Plan – Per
MonthMonth
Qualified/HSA Qualified/HSA Plan – Per MonthPlan – Per Month
Douglas County HSA Douglas County HSA Contribution – Per Contribution – Per
Month *Month *
Employee Employee OnlyOnly
$540.25$540.25 $556.46$556.46 $41.67$41.67
Employee Employee + 1 + 1 DependentDependent
$991.05$991.05 $1,020.78$1,020.78 $83.33$83.33
Employee Employee + Family+ Family
$1,335.81$1,335.81 $1,375.88$1,375.88 $83.33$83.33
* IMPORTANT: Must elect the HSA Qualfied Plan in order to receive the tax free contribution to you bank account.
Premium and HSA Contributions – (using 93%/Employee Covg./85% Dependent Covg.)
Coverage Coverage StatusStatus
Traditional Traditional Plan – Per Plan – Per
MonthMonth
HSA Qualified HSA Qualified Plan – Per Plan – Per
MonthMonth
Douglas County HSA Douglas County HSA Contribution – Per Month Contribution – Per Month
**
Employee Employee OnlyOnly
$37.82$37.82 $38.95$38.95 $41.67$41.67
Employee Employee + 1 + 1 DependentDependent
$105.44$105.44 $108.60$108.60 $83.33$83.33
Employee Employee + Family+ Family
$157.15$157.15 $161.86$161.86 $83.33$83.33
* IMPORTANT: Must elect the HSA Qualfied Plan in order to receive the tax free contribution to you bank account.
Your CDH Plan Option is Comprised of…
• Health Insurance provider• Processes medical care
claims • Tracks eligibility/benefits• Billing• Decision support tools
• Bank/HSA Custodian • Savings account to invest
money used for healthcare• Provides debit card to pay
qualified medical expenses• Tracks deposits, withdrawals,
interest, etc.
Bank (to be determined)United Healthcare
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Out of Pocket Costs - Defined• Premiums (What comes out of your
paycheck)
• Copays (Office visit, facility, Rx)
• Deductibles (Ind., Family, Per confinement)
• Coinsurance (20%, etc.)
• Plan Penalties (Precertification, Non-PPO, etc.)
Goal – REDUCE YOUR OUT OF POCKET EXPENSES!
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Let’s Look at an Example of an Actual Claim(Using a 93% Employee/85% Dependent Premium Cost Share)
Employee Only Coverage
Traditional Plan QHDHP/HSA
Example: Surgery with admission $10,000 $10,000
Deductible $1,000 $3,000
Coinsurance 20%=$1,800 0% =$0
Out of pocket (max. not met, still have $700 more to meet)
$2,800 $3,000 – HSA ($500) = $2,500
Office Copays (5 office visits) $30 x 5=$150 $0
Emergency Room Copay $250 N/A
Rx Copays (2 per mo. For 12 mos.)
$30x2x12=$720 $0
Premium Contribution $38 x 12= $456 $39 x 12 = $468
Actual Out Of Pocket Expense $4,376 $2,968 - H$A = ?
Let’s Look at a Example of a Actual Claim(Using a 93% Employee/85% Dependent Premium Cost Share)
Employee + 1/Employee + Family CoverageTraditional Plan QHDHP/HSA
Example: Surgery w/ admission $20,000 $20,000
Deductible $1,000 $6,000
Coinsurance 20%=$2,500 0% =$0
Out of pocket $3,500 $6,000 – HSA ($1000) = $5,000
Office Copays (4 office visits) $30 x 4=$120 $0
Urgent Care Copay (2 @ $50) $100 None
Rx Copays (3 per mo. ;12 mos) $30x3x12=$1,080
$0
Premium Contribution: E+1:
E + Fam:
$105x12= $1,260
$157x12= $1,884
$109x12 = $1,308
$162x12 = $1,944
Out Of Pocket Expense: E+1:
E+F:
$6,060
$6,684
$6,308
$6,944
The family in our previous example has a 2nd claim…Employee + 1/Employee + Family Coverage
Traditional Plan QHDHP/HSA
Example: ER with Treatment $2,500 $2,500
Deductible $1,000 $0 (already met)
Coinsurance 20%=$300 $0
Out of pocket
(still have $2,200 more to meet)
$1,000+$300 =
$1,300
Office Copays (2 office visits) $30 x 2 = $60 $0
ER Copay ($250) $250 $0
Rx Copays (1per mo. ;12 mos) $30x12=$360 $0
Total plan related out of pocket incurred on 2nd claim:
$1,970 $0
Out Of Pocket Expense: E+1:
E+F:
$8,030
$8,654
$6,308
$6,944
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What is a Health Savings Account (HSA)?
It is a tax-exempt savings account established to pay certain medical expenses in conjunction with a qualified high deductible health insurance plan.
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2 Components of an HSA
• A tax- free interest bearing or investment transaction account (HSA); and
• A qualified, high deductible health plan (QHDHP)
HSAHSA
QHDHP
HSA Eligible Individuals (who can have an HSA)…
• Must have a QUALIFIED HIGH DEDUCTIBLE PLAN• Must NOT be enrolled in Medicare• Cannot be claimed as a dependent on another’s income
tax return• Have not used VA benefits for past 90 days• May not be covered by any other insurance, except
what is permitted:– Specific disease or illness– Hospital Daily Income– Accident– Dental/Vision– Disability– Qualified Long-Term Care
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Qualified High Deductible Plan (QHDHP)
• Individual annual deductible of at least $1,200 and no more than $5,950 with an out of pocket maximum of no more than $5,950 (Douglas County’s CDH Plan has a $3,000 deductible for Individual/Employee Only)
• Family annual deductible of at least $2,400 and no more than $11,900 with an out of pocket maximum of no more than $11,900 (Douglas County’s CDH Plan has a $6,000 deductible for family coverage)
IMPORTANT: QHDHP’s have aggregate rather than imbedded deductibles, meaning the entire deductible amount must be satisfied by 1 or more family members before benefits are paid.
• Generally NO copays
Must have (for 2011)
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HSA Contributions - 2011
• Individual contribution is limited to $3,050 in ’11• Family contribution is limited to $6,150 in ’11• Excess contributions are subject to a 6% excise
tax plus ordinary income tax.• Contribution limits may increase each year
according to federal law.• Contributions can me made by Employer (pre-tax)
Employee (tax deductible), or both.• Age 55 and older can make “catch up”
contributions of an additional $1,000 per year
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Why Contribute to an HSA?The Triple Tax Benefit
1. Contributions are pre-tax or tax deductible2. Interest accumulates tax free3. Distributions for qualified expenses are
tax freeNO OTHER SAVINGS PROGRAM ALLOWS THIS!
Remember to include Douglas County’s contribution to your HSA (i.e., $500 or $1,000 annually) when computing your own maximum allowable contribution amount.
Employee Only Coverage: $3,050 - $500 = $2,550Employee + Dependent(s) Coverage: $6,150 - $1,000 = $5,150
(+ $1,000 Catch Up Contribution if 55 or older)
HSA Distributions• No tax or penalty on distributions used for
qualified expenses (Note: starting in 2011, non-prescription/over the counter drugs NOT qualified)
• Penalty of 20% plus ordinary income tax, if distributions used for non-qualified expenses
• Penalty goes away at age 65 or the death of the account holder (tax may still apply)
• If distributions continue to be used for qualified expenses, YOU NEVER PAY TAXES
• www.myuhc.com• Estimate treatment costs for conditions• Plan cost estimator• Rx comparisons• Personal health record• Health and Wellness information
YOUR decision support tools…
Login / Registration page
Simply go to myuhc.com, log in. Or if it’s your first time visiting the site, click the Register Now button.
UHC’s Plan Cost Estimator
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Milliman’s Plan Cost Estimator (link to follow)
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Milliman’s Plan Cost Estimator (link to follow)
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Quality & Cost Relationship
Hospital Comparison Tool
Estimate Costs of Future Treatments
• Plan for future expenses for various tests and treatments
• Calculate approximate costs in a geographical area• See estimated account balances
• Compare in-network and out-of-network costs
Estimate Costs of Future Treatments
Shopping Around For HealthcareIn Omaha, NE
Category Hospital A Hospital B Hospital C Hospital D Hospital E
ALOS (days) 3 3.8 3.3 3.7 3.8
Average Charge
$30,725 $46,997 $49,113 $49,397 $56,273
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Total Knee Replacement (DRG 302)
Shopping Around For HealthcareIn Omaha, NE
Category Hospital A Hospital B Hospital C Hospital D Hospital E
ALOS (days) 2.8 4.2 4.5 5.0 4.1
Average Charge
$41,475 $73,436 $91,098 $98,113 $102,18834
Lumbar Spine Fusion (DRG 304)
Maximizing your CDH experience…or…KEEPING MORE
MONEY IN YOUR POCKET!
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Generic Prescription Drugs Save
Rx Non-Formulary Formulary
Generic
GERD Nexium, Zegerid:$136 - $172
Aciphex, Protonix:$138-$172
Omeprazole:
$4 - $24
Cholesterol
Crestor,Zocor:
$109 - $166
Lipitor, Vytorin:$97 - $104
Simvastatin:
$4 - $15
Sleep Aids Ambien CR, Lunesta:$138 - $156
N/A Zolpidem:$4 - $15
Reduce your Prescription Drug Costs!
$4 Generic Prescription Drugs
Over 400 Rx available for $4!
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NE Rx Discount Card at work…
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Retail Healthcare (i.e. “grocery store” healthcare)($25 - $79 each)
Treatments1. Bladder Infection2. Bronchitis3. Colds4. Ear Infection5. Ear Wax Removal6. Flu Screening/Treatment7. Minor Skin Irritations8. Mono9. Pink Eye10. Seasonal Allergies11. Sinus Infection12. Sore Throat13. Strep ThroatFree Blood Pressure Checks
Screenings1. Cholesterol/Blood
Sugar2. Daycare Provider
Physicals3. Pregnancy Tests4. Sports Physicals5. TuberculosisAdult Immunizations1. Hepatitis A/B2. Measles/Mumps/Rubella3. Pneumonia4. Tetanus5. Tetanus/Pertussis
www.Alegent.com/QuickCare
• Service performed• Claim submitted to Insurance Carrier
Claim
EOB
EOB
Explanation of benefit
• Insurance Carrier re-prices claim as part of PPO (Preferred Provider Organization) arrangement Service $ 80 PPO Disc $ 15 Applied to $ 65 Deductible
• Insurance Carrier sends EOB and payment to Doctor and patient
Traditional Health plan with a co-payment works as follows:
•Go to healthcare provider
•Present ID card
•Pay co-pay (e.g. $30)
• Service performed• Claim submitted to Insurance Carrier
Claim
EOB
EOB
Explanation of benefit
• Doctor bills patient for amount due after receiving EOB• Pay using HSA or other
• Insurance Carrier re-prices claim as part of PPO arrangement Service $ 80 PPO Disc $ 15 Applied to $ 65 Deductible
• Insurance Carrier sends EOB to Doctor and patient
CDH Plan works as follows:
•Go to healthcare provider
•Present ID card
QUESTIONS ?
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