East Hartford BOE (Administrators) 2014 High Deductible Health Plan Information Meeting L O C K T O N C O M P A N I E S

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1 East Hartford BOE (Administrators) 2014 High Deductible Health Plan Information Meeting L O C K T O N C O M P A N I E S

2 2014 Health & Welfare Benefits July 1, 2014 there will be no change to our current insurance carriers for this year s renewal. Aetna will continue to provide Life/AD&D coverage of two times your base salary up to $500,000 at no cost to you. You will still have the option to purchase Long Term Disability insurance for yourself and additional Life/AD&D benefits for yourself, your spouse and children. Anthem will continue to offer you the same Dental plan, but only the High Deductible Healthcare Plan (HDHP) will be available for medical: Dental (Full Dental w/riders A, B & C) Medical HDHP High Deductible Healthcare Plan (HDHP $1,500 / $3,000) (PPO Network) HSA Bank will administer a Health Savings Account (HSA) for those employees enrolled in the HDHP option. 1

3 Anthem Plan - Medical In-Network Benefits HDHP Deductible (Individual/Family) $1,500/$3,000 Coinsurance 0% Out-of-Pocket Max (Individual/Family) $4,000/$8,000 Benefit Maximum Unlimited Preventive Care $0 PCP Office Visit Specialist Office Visit Radiology (advanced & non-advanced) Outpatient Therapy Chiropractic Care Urgent Care Emergency Room Ambulance Outpatient Hospital Inpatient Hospital 2

4 Anthem Plan Medical & Pharmacy Out-of-Network Benefits HDHP Deductible (Individual/Family) $1,500/$3,000 Coinsurance 20% Out-of-Pocket Max (Individual/Family) $4,000/$8,000 Benefit Maximum Unlimited In-Network Prescription Drugs HDHP Deductible (Individual/Family) $1,500/$3,000 Out-of-Pocket Max (Individual/Family) $4,000/$8,000 Annual Maximum Unlimited Retail Pharmacy Generic $10 after deductible Brand $25 after deductible Non-Listed Brand $40 after deductible Mail Order Pharmacy Generic $10 after deductible Brand $50 after deductible Non-Listed Brand $80 after deductible 3

5 Medical/Rx Contribution Review Medical Plan Cost (7/1/14 contributions) 2014 rates are still being finalized, but we expect the numbers below to be very close to the actual final employee contribution. Contributions - Medical Annual Medical Cost HDHP annual Employee Only $1,366 (16.0%) Employee + 1 $2,732 (16.0%) Family $3,688 (16.0%) 4

6 What Happens When I Go to my Doctor or Facility? You should not have to pay at the time of service when receiving medical services. 4 1 Show Medical ID card to provider. 2a 2b In-network doctor sends claim to Anthem. Out-ofnetwork doctor may send claim to Anthem. 3 When you have a claim, you will receive an Explanation of Benefits (EOB) Provider also receives the EOB from Anthem and then bills you directly for any balance that is your responsibility. 5 Use HSA funds to pay - OR - Pay with cash, check or credit card 5

7 What Happens When I Go to the Pharmacy? Payment is required at the pharmacy when picking up prescriptions Show Medical ID card to Pharmacy. Pharmacy verifies eligibility. You must pay the full cost of the prescription until you meet your deductible. Then you pay the applicable co-pay until the end of the plan year (June 30). You may use your HSA bank card (if you have available funds). 6

8 High Deductible Health Plan (HDHP) Frequently Asked Questions How does the HDHP plan differ from my current plan? HDHP - you must meet the deductible before the plan pays claims, the premium is lower. PPO/HMO you pay a small co-pay for doctor visits and prescriptions, the premium is higher. The HDHP is intended to encourage the consumer (you) to use their health plan wisely since you ll share the responsibility of the claims rather than a simple $5 co-pay. Does the HDHP use the same Anthem provider network? YES How is preventive care covered? In full no deductible How are pharmacy benefits covered? Prescriptions are subject to the deductible. Once you meet your deductible, you ll have co-payments of $10 generic, $25 brand name, $40 non-preferred. Mail order is no longer free. Prescription benefits are provided by EXPRESS SCRIPTS, no longer MEDCO. What is my maximum financial responsibility? In Network ($1,500 / $3,000 deductible & Rx Copayments) Out of Network ($4,000 / $8,000 out-of-pocket maximum) What expenses go towards my deductible? Medical & Rx covered by the plan 7

9 Health Savings Account (HSA) Frequently Asked Questions Will the BOE contribute toward my HSA? YES, 50% of the deductible funded on July 1 st Is there a use it or lose it provision? No. There also is no limit on the balance you can have in your account. It rolls over year-to-year. Is there a maximum annual contribution to a HSA? YES, the IRS limit for 2014 is $3,300/$6,550 includes BOE funds. Employees age 55 and older can contribute an additional $1,000 (catch-up contribution). Are there fees associated with an HSA? $1.75 per month unless $3,000+ balance at end of month Who owns the HSA? You, even when you leave employment. The only access the BOE has to your HSA is to DEPOSIT funds. The BOE cannot access your balance or your transaction history nor can it withdraw funds. How do I access funds? HSA bank debit card, on-line banking, checks What can HSA funds be used for? Eligible expenses under IRS Section 502 (medical/dental/vision), Section 213d of the Tax Code COBRA premiums Medicare & Medicare Part D premiums (except for Medicare Supplement or Medigap) Long Term Care insurance premiums 8

10 Health Savings Account (HSA) Frequently Asked Questions (continued) Are there penalties for misuse of funds? 20% penalty prior to age 65 / always taxable Can I contribute to my HSA? Yes, pre-tax payroll deductions, can be changed in the first pay check of each month. Can I enroll in an HSA if I am enrolled for coverage other than a qualified HDHP? The simple answer is no see below for disqualifying coverage. Disqualifying coverage Flexible Spending Account- Medical (Employee or spouse s plan) Medicare Enrolled as a dependent on spouse s non-qualified plan VA benefits within the last three months Coverage under Tricare Adult Children up to age 26 Children are allowed to be enrolled on their parents plan up to age 26, but there are some restrictions when it comes to the Health Savings Account. If an adult child covered on the HDHP is not considered a tax dependent of the employee who owns the Health Savings Account, HSA dollars from the employee s account cannot be used to pay for the adult child s eligible expenses. SOLUTION the adult child can set up his/her own Health Savings Account. 9

11 Our Mission To be the worldwide value and service leader in insurance brokerage, employee benefits, and risk management Our Goal To be the best place to do business and to work Lockton, Inc. All rights reserved. Images 2012 Thinkstock. All rights reserved. 10