BENEFIT STATE OF LOUISIANA OFFICE OF GROUP BENEFITS

Transcription

1 SPRING 2011 For Your BENEFIT STATE OF LOUISIANA OFFICE OF GROUP BENEFITS OGB announces important changes for 2011 The Office of Group Benefits is holding Annual Enrollment from April 1 through 30, Flexible Benefits Annual Enrollment is April 1 through May 13 (or may end earlier for some agencies). There will be a short 6-month plan year (July 1 through December 31, 2011) for 2011 to enable OGB to change to a plan year that coincides with the calendar year (January 1 through December 31) beginning in The short plan year also applies to Flexible Benefits. OGB will offer expanded coverage in several key areas for the upcoming plan year that begins July 1, 2011, as mandated by federal law (the Affordable Care Act and the Mental Health Parity and Addiction Equity Act): The pre-existing condition (PEC) exclusion will no longer apply to any employee or dependent under age 19. OGB will offer coverage for dependent children up to age 26, regardless of student, marital or tax status. A covered child under age 26 who is or becomes incapable of self-sustaining employment is eligible to continue coverage as an overage dependent if OGB receives required medical documents verifying his or her incapacity before he or she reaches age 26. The definition of incapacity has been broadened to include mental and physical incapacity. OGB will hold a Special Enrollment from April 1 through July 31 to enable employees and retirees to enroll or re-enroll newly eligible children for health coverage and life insurance effective July 1 with no pre-existing condition exclusion. This Special Enrollment period applies to children who lost coverage or were not eligible for coverage because they reached the previous maximum age for dependent coverage. However, any such child enrolled after July 31 will be considered a late applicant, and a pre-existing condition exclusion will apply if the child is age 19 or older, unless portability applies. Additional changes will take effect on July 1, 2011, in accordance with the Affordable Care Act: The individual lifetime maximum for benefits has been eliminated. Annual dollar limits on essential benefits are also eliminated. Preventive care (wellness) will be paid at 100 percent (no deductibles, co-payments or co-insurance) if services are provided by a network provider. Preventive care benefit limits no longer apply. A complete list of covered preventive services is available on the Annual Enrollment page of the OGB website ( The plan member cost-share (deductible, co-insurance, or co-payment) for inpatient and outpatient medical care and surgery will also apply to inpatient and outpatient mental health and substance abuse (MHSA) treatment. There will no longer be a separate plan member costshare for MHSA benefits. (continued on page 2)

2 2011 Plan Year Changes OGB announces important changes (continued from page 1) OGB will also make other important changes for the 2011 plan year effective July 1, 2011: A new Regional HMO health plan (insured by Vantage Health Plan) will be available in Baton Rouge, Alexandria, Shreveport and Monroe. To enroll, a plan member must live in a zip code where the plan is offered (Ascension, Avoyelles, Bienville, Bossier, Caddo, Caldwell, Catahoula, Claiborne, Concordia, DeSoto, East Baton Rouge, East Carroll, East Feliciana, Franklin, Grant, Iberville, Jackson, LaSalle, Lincoln, Livingston, Madison, Morehouse, Natchitoches, Ouachita, Pointe Coupee, Rapides, Red River, Richland, Sabine, Tensas, Union, Vernon, Webster, West Baton Rouge, West Carroll, West Feliciana and Winn parishes). OGB will also offer a new Limited-Purpose Flexible Spending Arrangement (LPFSA) that allows plan members to use pre-tax dollars to pay eligible out-of-pocket dental and vision expenses only. Plan members cannot participate in the General-Purpose FSA and the Limited-Purpose FSA at the same time. However, plan members who enroll in the Consumer Driven health plan with a Health Savings Account option (CDHP-HSA) can also participate in the LPFSA option. (See page 3) The plan member cost-share for the PPO and HMO (Blue Cross) health plans will not reset on July 1, Instead, if the plan member has already met the deductible or out-of-pocket maximum for the plan year, the plan member cost-share will not reset until January 1, The plan member cost-share for the Consumer Driven health plan will reset on July 1, This means CDHP-HSA plan members will have only 6 months to meet the annual deductible (due to the short 6-month plan year), so the state s HSA contribution for 2011 will increase. The state will make a one-time contribution to a plan member s HSA equal to half of the deductible amount in addition to what the state normally contributes. This additional one-time contribution will be based on the plan member s level of coverage on July 1. The state s standard contribution rate is $100 per plan year, plus a match of additional plan member HSA contributions, dollar-for-dollar, up to $400 per plan year. The prescription drug benefit for the PPO and HMO (Blue Cross) health plans will cover over-the-counter proton pump inhibitor (PPI) medications for heartburn and gastroesophageal reflux disease (GERD), such as Prilosec OTC, Prevacid24HR and Zegerid OTC. A prescription from a physician is required. The plan member will pay 50 percent of the cost of the drug at the point of purchase up to a maximum of $50 per 30-day supply. These OTC medications, once available by prescription only, are equally effective for most people and far less costly. (See page 6) To learn more about these changes, attend an Annual Enrollment meeting and visit the Annual Enrollment page of the OGB website ( which can be accessed by clicking the Annual Enrollment icon on the home page. PAGE 2

3 Limited-Purpose FSA OGB to offer new Limited-Purpose Flexible Spending Arrangement for 2011 plan year Effective July 1, 2011, OGB will offer a new Limited-Purpose Dental/Vision Flexible Spending Arrangement (LPFSA) in addition to the existing General-Purpose Health Care FSA (GPFSA). Unlike the General-Purpose Health Care FSA, however, reimbursement from the Limited-Purpose Dental/Vision FSA account will be limited to eligible out-of-pocket dental and vision medical expenses only. The LPFSA will be available to all full-time employees who worked for a participating agency during the entire previous plan year, including those enrolled in the Consumer-Driven health plan, even if they will also be participating in the Health Savings Account (HSA) option. can incur eligible expenses during this period to be paid with money remaining in FSA for immediately preceding plan year that ends December 31. The run-out period is March 16 through April 29, Claims for reimbursement must be received by April 29, To participate in the LPFSA or the GPFSA, an employee must have been employed by his or her current agency since the first day of the immediately preceding plan year. A participating employee who chooses to sign up for the LPFSA or the GPFSA must pay the administrative fee of $18 and deposit a minimum of $300 and a maximum of $2,500 through payroll deductions during the short plan year. Eligible employees will be able to enroll in either the LPFSA or the GPFSA, but not both. As with the GPFSA, the IRS use or lose rule applies to the LPFSA. The grace period for the 2011 plan year is January 1 through March 15, Employees Flexible Benefits Annual Enrollment is April 1 through May 13, but this may vary by agency. Check with your human resources office for dates. PAGE 3

4 Less Taxes Give yourself a pay raise particip If you are an active employee with out-of-pocket expenses for health care or dependent care, OGB offers several options that can save you money by enabling you to pay these expenses BEFORE taxes are computed and deducted from your salary. This means you pay taxes only on the income that remains AFTER you pay these expenses, which increases your take-home pay. What is Premium Conversion? The Premium Conversion option enables you to pay premiums for your OGB health coverage and life insurance with pre-tax dollars. This option also applies to monthly premiums deducted from your paycheck for certain other eligible insurance products. There is no administrative fee for this option. Once you enroll, you automatically remain enrolled from one plan year to the next until you choose to stop participating or you no longer work full-time for a state agency that offers the program. What is a Flexible Spending Arrangement (FSA)? Participating in a Flexible Spending Arrangement enables you to pay various qualifying expenses with pretax dollars using a special FSA account. Each FSA can be used only for specific types of qualifying expenses. The Dependent Care FSA (DCFSA) allows you to use pre-tax dollars to pay for child care services in your home, someone else s home or a licensed day care facility, plus expenses for summer day camp. Expenses for care of a dependent or spouse incapable of self-care in your home or someone else s home also are allowed. The General-Purpose Health Care FSA (GPFSA) allows you to use pre-tax dollars to pay for medical expenses such as prescription drugs, over-the-counter medications and supplies, doctor fees, dental care, vision care and hearing aids. PAGE 4 The Limited-Purpose Dental/Vision FSA (LPFSA) allows you to use pre-tax dollars to pay for dental and vision care expenses only. The Flexible Spending Arrangement Handbook lists eligible expenses for each FSA. You can participate in the DCFSA option and either the GPFSA or the LPFSA option, but you cannot participate in the GPFSA and the LPFSA during the same plan year. You can participate in a General- Purpose Health Care FSA or Limited Purpose Dental/Vision FSA or Dependent Care FSA even if you are not enrolled in an OGB health plan or the Premium Conversion option. Who is eligible to participate? General-Purpose Health Care FSA You are eligible to participate if you meet all of these conditions: You are an active full-time employee (as defined by your employer); You were continuously employed by your current employer for at least the 12 consecutive months from July 1, 2010, through June 30, 2011; You are employed by a public agency that utilizes the State of Louisiana Flexible Benefits Plan; You are not contributing to a Health Savings Account (HSA); and You pay the administrative fee. Limited-Purpose Dental/Vision FSA You are eligible to participate if you meet all eligibility conditions for the GPFSA, with one exception: If you are enrolled in the CDHP-HSA, you are allowed to contribute to an HSA.

5 More Take-Home Pay ate in OGB Flexible Benefits Plan Dependent Care FSA You are eligible to participate if you meet all of these conditions: You are an active full-time employee, as defined by your employer; You are employed by a public agency that utilizes the State of Louisiana Flexible Benefits Plan; and You pay the administrative fee. How does an FSA work? You authorize deduction of a fixed amount from each paycheck for deposit into your FSA account. This amount is deducted from your salary each pay period before taxes are computed. You then use money in your FSA account as needed to pay eligible expenses for you, your spouse and all dependents claimed on your federal tax return. The General-Purpose FSA and the Limited-Purpose FSA allow you to access the total annual amount at the beginning of the plan year via a debit card. The Dependent Care FSA allows you to access the current account balance and schedule automatic reimbursements. When determining how much to contribute to your FSA account, it s important to be realistic and keep in mind that each FSA is a separate account and money cannot be transferred between them. Any money left over in your FSA at the end of the plan year, grace period and run-out period cannot be rolled over or returned to you, in accordance with the Internal Revenue Service use or lose rule. When can I enroll? OGB Flexible Benefits Annual Enrollment for the short 2011 plan year takes place April 1 through May 13, Your agency may set an earlier closing date, so be sure to check with your agency s human resources or payroll section. For more information about the Flexible Benefits Plan, visit the OGB website ( Less Taxes = More Take-Home Pay Jane Deaux, an employee participating in a General Purpose Health Care FSA, earns $2,000 per month and is in the 20 percent tax bracket. A single mother with children in Medicaid, she uses her Health Care FSA to pay for approved non-medicine items and prescription drugs for her family. With GPFSA Without GPFSA Monthly Salary $2, $2, Monthly GPFSA Deduction Monthly GPFSA Administrative Fee Monthly Taxable Income 1, , Taxes (20%) After-Tax Health Care Expenses SPENDABLE INCOME $1, $1, $27.60 Monthly Savings x 6 = $ Savings (Short Plan Year) To continue FSA participation, you must re-enroll each year during Flexible Benefits Annual Enrollment. PAGE 5

6 Expanded Drug Coverage PPO, Blue Cross HMO plans to cover overthe-counter proton pump inhibitor (PPI) medications OTC PPIs save money for plan member and reduce health plan costs, helping keep premiums low Effective July 1, 2011, the prescription drug benefit for the PPO and HMO (Blue Cross) health plans will cover over-the-counter proton pump inhibitor (PPI) medications, such as Prilosec OTC, Prevacid24HR and Zegerid OTC, which are used to treat frequent heartburn and gastroesophageal reflux disease (GERD). A prescription from the plan member s physician that clearly says OTC is required. The plan member will pay 50 percent of the cost of the drug at the point of purchase, up to a maximum of $50 per 30-day supply. PPI Medication Cost Comparison... These over-the-counter (OTC) medications, once available by prescription only, are equally effective for most people and far less costly than prescription PPI medications. In cases where the plan member s doctor determines it is medically appropriate for the plan member to use less expensive OTC PPIs, it will save money for both the plan member and his or her health plan. Keeping health care costs as low as possible while maintaining quality helps OGB keep premium rates as low as possible for all OGB plan members. Prescription PPI Medications Plan Member Cost OGB Cost Total Cost * Aciphex $50.00 $ $ Nexium $50.00 $ $ Dexilant $50.00 $81.76 $ Pantoprazole $50.00 $71.41 $ Over-the-Counter PPI Medications Plan Member Cost OGB Cost Retail Cost ** Prilosec OTC 20 mg (14-count) $6.49 $6.50 $12.99 Prilosec OTC 20 mg (28-count) $10.99 $11.00 $21.99 Prilosec OTC 20 mg (42-count) $14.49 $14.50 $28.99 omeprazole otc 20 mg (14-count) $4.99 $5.00 $9.99 omeprazole otc 20 mg (28-count) $8.99 $9.00 $17.99 omeprazole otc 20 mg (42-count) $11.49 $11.50 $22.99 Prevacid 24HR 15 mg (14-count) $6.49 $6.50 $12.99 Prevacid 24HR 15 mg (28-count) $10.99 $11.00 $21.99 Prevacid 24HR 15 mg (42-count) $14.49 $14.50 $28.99 Zegerid OTC mg (14-count) $6.49 $6.50 $12.99 Zegerid OTC mg (28-count) $10.99 $11.00 $21.99 Zegerid OTC mg (42-count) $14.49 $14.50 $28.99 * Average costs based on prices from January 1 through December 31, ** Prices are approximate and may vary by retailer. PAGE 6

7 Dependent Verification Dependent verification change for newborns: OGB must receive birth certificate within 6 months Effective July 1, 2011, a birth certificate must be received within 6 months of the child s date of birth. (The birth letter provided by the hospital will suffice for the first 6 months only if received within 30 days of the date of birth.) OGB will send a reminder letter to plan members with a covered newborn 90 days after the date of birth. Coverage will be terminated unless a copy of the birth certificate is received before the end of this 6-month period. Previously, plan members were given a year to turn in birth certificates because of delays following Hurricanes Katrina and Rita. If you have questions about the dependent verification policy, call or visit your local OGB Customer Service office or the human resources staff at your agency or school board. Vision OGB envisions itself as a leader in improving and preserving quality of life. Mission OGB will offer an employee benefits system that meets or exceeds industry standards and/or benchmarks. OGB Area Customer Service Offices Alexandria 900 Murray St. Suite F-100 Alexandria, LA Baton Rouge 7389 Florida Blvd. Suite 400 Baton Rouge, LA Lafayette 825 Kaliste Saloom Rd. Building II, Suite 101 Lafayette, LA Lake Charles 710 W. Prien Lake Rd. Suite 109 Lake Charles, LA Monroe 1400 N. 19th St. Monroe, LA New Orleans Benson Tower 1450 Poydras St. Suite 850 New Orleans, LA Shreveport 1525 Fairfield Ave. Room 669 Shreveport, LA TDD (hearing impaired) PAGE 7

8 Office of Group Benefits State of Louisiana P. O. Box Baton Rouge, LA Presorted Standard US Postage PAID Baton Rouge, LA Permit # 266 Notice of Opportunity to Enroll Extension of Dependent Coverage to Age 26 Individuals whose coverage ended, or who were denied coverage (or were not eligible for coverage) because the availability of dependent coverage of children ended before attainment of age 26, are eligible to be enrolled as a dependent in an OGB health plan. Plan members may request enrollment for such children until July 31 for coverage effective July 1, For more information, call or visit your local OGB Customer Service office (listed on page 7). See the article on page 1 for additional details about this special enrollment opportunity. This document was printed for the Office of Group Benefits in April 2011 by Moran Printing to inform state employees about benefits at a total cost of $30, for 147,300 copies (20.8 cents each) in this first and only printing under authority of the Division of Administration in accordance with standards for printing by state agencies established pursuant to La. R. S. 43:31.