Module IV PLAN DESIGN

Transcription

1 Module IV PLAN DESIGN

2 Plan Design Benefits Deductible Cost Sharing Out of Pocket Actuarial Value 2

3 Think about your spreadsheets 3

4 ESSENTIAL BENEFITS 4

5 Mandated Benefits

6 Small Group Mandates in Texas Source:

7 New Term Essential Benefits 7

8 What are essential benefits? Essential Benefits = Mandates

9 What essential benefits are required by the law? The law specifies that the essential health benefits package must include at least 10 categories of items and services. Source:

10 10 Essential Benefits Ambulatory patient services Emergency services Hospitalization Maternity & newborn care Mental health & substance abuse Prescription drugs Rehabilitative services Laboratory services Preventive Services Pediatric dental & vision care

11 But that s not all The Secretary of HHS was directed to come up with a complete list of essential benefits. HHS decided to let the states pick a benchmark plan. Texas chose the largest small group plan in the state as our benchmark plan. That plan contained all of the small group mandated benefits, so they are now considered essential benefits. Essential benefits must be covered by all individual and small group plans and cannot have an annual or lifetime dollar limit. 11

12 Benchmark Plan Options in Texas Source:

13 But that s not all The Secretary of HHS was directed to come up with a complete list of essential benefits. HHS decided to let the states pick a benchmark plan. Texas chose the largest small group plan in the state as our benchmark plan. That plan contained all of the small group mandated benefits, so they are now considered essential benefits. Essential benefits must be covered by all individual and small group plans and cannot have an annual or lifetime dollar limit. 13

14 Small Group Mandates in Texas are essential benefits Now these are individual mandates too. Source:

15 We have to add one to the list Ambulatory patient services Emergency services Hospitalization Maternity & newborn care Mental health & substance abuse Prescription drugs Rehabilitative services Laboratory services Preventive Services Pediatric dental & vision care

16 Pediatric Dental & Vision

17 Requirements of Market Segments Individual Small Group Large Group Self-Funded Must cover all essential benefits with no annual or lifetime dollar limits Must cover all essential benefits with no annual or lifetime dollar limits No requirement to cover any specific essential benefit other than preventive care Cannot have any annual or lifetime dollar limits on any essential benefits that are covered No requirement to cover any specific essential benefit other than preventive care Cannot have any annual or lifetime dollar limits on any essential benefits that are covered 17

18 COST SHARING 18

19 3 Rules on Cost Sharing $2,000 deductible limit (small group only) Actuarial values (metallic plans) Maximum outof-pocket with new way to determine OOP 19

20 How it s worked in the past Traditional PPO Plans Copays: DR Rx Deductible Coinsurance % HSA-compatible Plans Deductible Coinsurance % Max OOP OOP Max ($6,350)

21 2014 cost-sharing limitations And all plans will have 60%, 70%, 80%, or 90% AV requirements Traditional PPO Plans Deductible Coinsurance % Copays HSA-compatible Plans $2k/$4k deductible limit (small group only) Deductible Coinsurance % 2x family limit Everything in-network counts OOP Max ($6,350) OOP Max ($6,350)

22 Deductible limit for small group eliminated 22

23 Out of pocket limits Tied to HSA OOP limit: $6,350 single coverage; $12,700 family coverage All in-network services apply to OOP limit Two-times OOP limit per family Applies to all nongrandfathered plans (after any transition period) in all market segments 23

24 OOP Limit will make HSAs more attractive HSAs will become more attractive from a pricing standpoint Traditional PPO copay plans will have to increase their benefits; HSAs already meet the requirements. This will create a bigger price separation between HSAs and copay plans. Because HSAs will likely be the lowest-priced qualified plan, it s the best way for a large employer to avoid a penalty (buy-up options can still be offered, but the base plan should be HAS-compatible). 24

25 Actuarial Value De-minimus variation allowed: plus or minus 2%

26 AV Calculator Developed by HHS Based on a standard population When would we need this? Only if doing self-funded plan (designing our own) Fully-insured carrier designs plan and tells us metallic level 26

27 Minimum Value 60% BRONZE PLAN MINIMUM VALUE HHS has also developed a minimum value calculator. This becomes important when determining an employer s potential 4980H (employer mandate) liability. 27

28 Plan Design ANY QUESTIONS? 28