Administration Guide. For employers with self-funded health plan designs and stop-loss insurance

Transcription

1 Administration Guide For employers with self-funded health plan designs and stop-loss insurance

2 Welcome to Starmark This administration guide will provide you with a better understanding of your administrative responsibilities for your self-funded health plan and stop-loss insurance coverage. For your convenience, you can download any of the forms referenced in this guide from the Starmark website at You may also obtain any of the forms by contacting your agent or a Starmark customer service representative at While this guide should provide answers to most of your questions, please contact a customer service representative if you have a question not addressed in this guide. Be sure to have your group number and/or the employee s identification number available at the time of the call. We look forward to providing you with the exceptional customer service that you and your employees deserve. If there is any discrepancy between the stop-loss insurance contract or Administrative Services Agreement and this administration guide, the stop-loss insurance contract and Administrative Services Agreement will prevail. Self-funded plans are administered by Starmark, and stop-loss insurance coverage is provided by Trustmark Life Insurance Company. Plan design availability and/or stop-loss coverage may vary by state. 2

3 Table of Contents Page Online Resources Monthly Billing Billing Adjustments/Rate Changes Monthly Reporting New Contract Year Provisions Adding A Subsidiary Changing Ownership Changing Address Changing Your Plan Design Enrollment Who Is Eligible? When Is Someone Eligible? How to Enroll Employees and Dependents When Is Self-funded Coverage Effective? Misstatement on the Employee Eligibility Statement Medicare Waiving Coverage Under Your Self-Funded Benefit Plan Termination of Coverage Under Your Self-Funded Benefit Plan Employee Termination Employer Termination Terminations Mid-Contract Year Runout Period Continuation of Coverage Miscellaneous Administration Participation Requirements Using Your Self-Funded Benefit Plan Claim Filing Instructions Precertification Procedures Prescription Drug Benefit Coordination of Benefits Glossary

4 Online Resources A variety of online resources are available to help you administer your plan. Simply login at Document Center By opting-in to the Starmark Document Center you can enjoy convenient, secure online access to important documents, including: Plan Document Stop-Loss Insurance Contract Administrative Services Agreement Application for Stop-Loss Insurance Coverage Monthly Billing Statement Monthly Aggregate Claim Liability Summaries You can opt-in during registration on the Starmark website. Or, if you re already registered, simply log in to the Starmark website and select I AGREE within the profile. Manage My Group This convenient resource is available 24/7/365 so you can: Add new employees or special enrollees Add coverage for an employee s newborn dependent Update mailing and addresses for an employee or your business Waive coverage for an employee or an employee s dependent Order replacement ID cards Remove coverage for a terminated employee Add or update dependent Social Security numbers Online Bill Payment Conveniently pay your monthly bill at When you use online bill payment, you ll receive two confirmation s: the first one confirms the transaction went through and the second confirms the funds have been withdrawn. You can also view the details of your most recent online payment or, if necessary, update your banking information. Monthly Billing 1. Statements are prepared and mailed to employers on or about three weeks prior to the date payment is due. Statements are also available online by accessing the Starmark Document Center. Employers using electronic funds transfer (EFT) will have bills prepared and mailed approximately 10 days prior to the due date. Bills will list the cost for each covered employee and dependent, if any. 2. The monthly bill can be paid online at via electronic funds transfer (EFT) or by mail. If using mail, the tear-off section of the statement and a check made payable to Starmark should be remitted by the due date every month. All payments should be paid in advance, payable by you or any person designated to act on your behalf. Each payment shall be equal to the sum of the amounts payable for each person covered, plus or minus any adjustments indicated on the bill. Use the envelope provided with your statement; it is specifically for payments. Retain the remaining portion of the statement for your records. 3. If you require your employees to contribute to their self-funded benefit plan, payment should be deducted monthly. The first deduction for a new employee should be made as mutually agreed upon between you and that employee. If you change your contribution, you must notify Starmark. 4

5 4. All checks are automatically deposited and cashed by our bank, regardless of the status of your plan. Cashing of a monthly check on a lapsed stop-loss insurance contract does not guarantee continued coverage. In the event that a check is returned due to insufficient funds, an additional service fee will be added to your payment amount. Multiple checks returned for insufficient funds may result in the termination of your plan. 5. If there are any mitigating circumstances regarding any lapse or termination situation, you should discuss these with a customer service representative. Reinstatement options, along with a reinstatement fee, may apply. 6. Timely payment is critical to ensure that administration of your self-funded benefit plan continues without interruption. If the current amount due is not paid by the end of the grace period, the stop-loss insurance contract and Administrative Services Agreement will automatically terminate on the last day of the period for which your last payment was made. A letter confirming the date of termination will be sent after the end of the grace period. It is your responsibility to advise your employees if your self-funded benefit plan is also terminated. 7. The grace period starts on the due date and runs for 31 days from the due date. Payment must be made before the end of the grace period. Claim payments will be held while the account is in the grace period, until all monthly payments due are received. 8. Electronic funds transfer (EFT) for monthly payments is available only through financial institutions that are Automated Clearing House (ACH) members. To add or make changes to your method of payment, please allow at least 14 days to process the request. For more information, contact a Starmark customer service representative at , extension If you wish to terminate your stop-loss insurance coverage and the Administrative Services Agreement, you must notify us in writing prior to the proposed date of termination. We will not retroactively make terminations. See the Termination of Coverage Under Your Self-Funded Benefit Plan section. Payment addresses Online payment: Monthly payment: Log on to > administration > online bill payment Starmark Administration 75 Remittance Drive, Suite 3087 Chicago, IL Overnight payment: Starmark Administration, Suite 3087 c/o The Northern Trust Bank 350 North Orleans Street Receipt & Dispatch, 8th Floor Chicago, IL All other correspondence: Starmark 400 Field Drive Lake Forest, IL Billing Adjustments/Rate Changes 1. Adjustments on your statement may occur if any of the following changes are made to your self-funded benefit plan: a. A new employee is added to the plan. b. An employee is terminated. c. An employee makes a change in the type of coverage selected (i.e., family coverage to single coverage). d. Changes are made to the plan s benefits. 5

6 If an employee terminates employment, their coverage under your self-funded benefit plan will terminate on the last day of the month in which the employee worked. You are responsible for that employee s billing amount for the entire month. If claims are paid after the requested termination date, you are responsible for an additional month s payment. To avoid additional charges, notify us by the end of the month in which the termination occurs by completing the Termination/Waiver Section located on the back of the billing statement. In an effort to limit billing adjustments, we recommend you make the monthly payment as billed. If you add an employee, dependent or spouse, do not adjust your payment until the change appears on your bill. You will be back-billed and/or you will receive credit for changes on the next statement generated after the changes are processed. 2. We may change the stop-loss insurance contract premium rate on any of the following: a. the date when the terms of the stop-loss insurance contract are changed; b. the date that you add or delete a subsidiary or affiliated company or division; c. the date of any revision to your self-funded benefit plan; d. the date your location or the nature of business in which you are engaged changes; or e. The date there is a change in enrollment exceeding 10% of the first month s enrollment of the current contract period or the 9th month of the prior contract period. Monthly Reporting An Aggregate Claim Liability Summary report that compares your actual claim activity to the aggregate liability is available in the Document Center on the Starmark website. Every month, you will receive an Aggregate Claim Liability Summary report that compares your actual claim activity to the aggregate liability. The aggregate liability represents the amount of claims for which you are responsible. A portion of your monthly payment is deposited into a designated bank account to cover this liability. The report allows you to track your claims. New Contract Year Provisions 1. Your broker will receive written notice at least 30 days prior to the effective date of any rate change for a new stop-loss insurance contract year. 2. Prior to the end of the contract year, you will be required to complete an Employer Certification form to verify the number of eligible employees and the number of employees participating in your self-funded benefit plan. At our discretion, additional documentation may be requested such as a copy of the most recent State Quarterly Wage and Tax statement. 3. You will be required to meet participation requirements for the new Contract Period. 4. At the end of the Contract Period, but only by mutual agreement of you and Starmark, the contract may be renewed for another Contract Period. The new Contract Period will be subject to new premium rates, new underwriting terms, a new Benefit Period and new Contract terms. New agreements must be signed and returned prior to the effective date of the new Contract Period. It s important we receive your signed documents by the new plan year start date so there is no disruption to claim paying services. (Claims are pended until it s confirmed via the signed agreements you will proceed with a self-funded plan design from Starmark.) Payment of your monthly billing statement will be considered acceptance of the new billing amounts for the new plan year. 6

7 Adding a Subsidiary If you request to add a location (i.e., subsidiary or affiliate), a newly purchased company, a new class of employees to your stop-loss insurance contract, or if group composition changes by 10% or more, the stop-loss insurance contract for your entire group must be re-underwritten. The monthly billing amount will be changed to reflect your company s new composition and other risk factors as a result of the additional employees. To make any of these changes, you must submit all of the following: 1. Newly completed Application for Stop-Loss Insurance Coverage 2. Newly completed Eligibility Statement for employees being added to the plan 3. Most recent State Quarterly Wage and Tax Statement (may be required at the discretion of the underwriter) 4. Eligible Employee Census (T401-14) (may be required) Changing Ownership If your business undergoes a change in ownership, complete a new Application for Stop-loss Insurance Coverage and return to us. New Plan Documents may be required. Changing Address 1. You must notify us of any change in address and can provide the information online using Manage My Group. If your business moves within the original state of issue or to another state in which Starmark self-funded benefit plan designs and stop-loss insurance coverage are available, your monthly billing amount will be adjusted to reflect the new address at the next contract year. 2. If your business moves to a state where Starmark self-funded benefit plan designs and stop-loss insurance coverage are not available, your stop-loss insurance contract and Administrative Services Agreement will be terminated as of the new plan year. Changing Your Plan Design You may be able to make changes to your self-funded benefit plan design. Submit all requested changes in writing. All changes are subject to approval. If you change the percent or amount you contribute to the cost of your self-funded benefit plan, then you must notify us in writing within 30 days of the change. Some changes in contribution levels may affect your plan design. 1. Who Is Eligible? Enrollment Self-funded coverage must be offered to all eligible employees and their dependents. a. To be considered an eligible employee, a formal employer-employee relationship must exist that can be confirmed by demonstrating the employer pays FICA wages and reports them on a Federal W-2. Any employee, including a proprietor or partner, who works for the employer at least 25 hours per week on a regular basis is eligible for coverage. An employee must reside in the U.S. and be: i. A U.S. citizen and possess a Social Security number; or ii. A legal alien, possess a work visa or green card, and have been issued a Social Security number or other governmentissued identification number. 7

8 b. An eligible dependent is an eligible employee s legally married spouse or child under the age of 26. A child who is the subject of a court-issued, qualified medical support order or a child placed for adoption (including the time before the adoption is final) may also be considered an eligible dependent. c. Independent contractors, commissioned or 1099 employees may be considered on groups of five or more eligible employees if they work for only one employer and comprise no more than 50 percent of the total employees enrolling in the benefit plan. A copy of the 1099 form for each employee will be required. Part-time, temporary, seasonal, retired or leased employees are not eligible for coverage. Boards of Directors, shareholders and/or silent partners are not considered eligible for coverage unless they can show a full-time employment status. 2. When Is Someone Eligible? An employee and/or dependent is eligible for coverage under your self-funded benefit plan on the following dates: a. For an employee: i. Completion of the waiting period, if any, selected by you; or ii. The date of a qualifying event for special enrollment. b. For a dependent: i. The date the employee is eligible for coverage; or ii. The date of a qualifying event for special enrollment. 3. How To Enroll Employees and Dependents You can add new employees and dependents to your self-funded plan online using Manage My Group. If using paper enrollment, each employee must fully complete, sign and date the Employee Eligibility Statement for himself and/or his dependents. The completed Employee Eligibility Statement must be received by us within the waiting period but no later than the 31-day initial enrollment period. If you enroll an employee and/or dependent and he terminates employment before the effective date, notify us in writing and self-funded coverage will not become effective for that employee and/or his dependents. An employee and/or dependent is also eligible for self-funded coverage if he previously waived coverage and the employee and/or dependent has a special enrollment event. See the Special Enrollee section for more information. It is important to enroll the employee and/or dependent when the enrollee becomes eligible to avoid several months of potential retroactive payment charges. 4. When Is Self-Funded Coverage Effective? Timely Enrollees A timely enrollee is an eligible employee who completes and signs the Employee Eligibility Statement on behalf of himself and/ or his dependents. The effective date for timely enrollees is as follows: Immediate (no waiting period) When an Eligibility Statement is signed on the date of hire or within the 31 day initial enrollment period immediately following the date of hire, the effective date is the date of hire. 8

9 Immediate (waiting period) When an Eligibility Statement is signed within the waiting period or within the 31 day initial enrollment period immediately following the waiting period, the effective date is the day immediately following the waiting period. First of the month following (no waiting period) When an Eligibility Statement is signed on or after the date of hire, but no later than the 31 day initial enrollment period after the first of the month following the date of hire, the effective date is the first of the month following the date of hire. First of the month following (waiting period) When an Eligibility Statement is signed within the waiting period or within the 31 day initial enrollment period after the first of the month following the waiting period, the effective date is the first of the month following the waiting period. Enrollment requirements are determined at the time the Employer Application is completed and signed. If a timely Employee Eligibility Statement is missing information, the employee will be contacted to supply the missing information. The information must be received in order for the employee s coverage under your self-funded benefit plan to become effective. The employee may still receive coverage on the date he became eligible based on the date of the original Employee Eligibility Statement. Appropriate payment, which may include charges back to the effective date, will appear on the billing statement once coverage under your self-funded benefit plan is in effect. IMPORTANT NOTICE: Incomplete or outdated eligibility statements may cause the enrollee to be considered a late enrollee. Late enrollees will not be permitted to enroll in coverage until the annual open enrollment period. Annual Open Enrollment Period Eligible employees may enroll themselves and their eligible dependents during the annual open enrollment period, which is the month prior to the start of the new plan year. Employee Eligibility Statements for new enrollees must be signed and received by Starmark Administration prior to the end of the open enrollment period to be accepted for processing. Special Enrollees A special enrollee is an employee and/or dependent who previously waived coverage under your self-funded benefit plan, but may now be eligible because an approved qualifying event occurred. The enrollment period for a special enrollee is the 31 days following the qualifying event (60 days for special enrollees who have lost their Medicaid or State Children s Health Insurance Program coverage). You can enroll special enrollees online using Manage My Group. If using paper enrollment, an Employee Eligibility Statement and a Special Enrollee Form (AD41) must be submitted, along with documentation to support the qualifying event, if the employee or dependent qualifies as a special enrollee. If an applicant qualifies as a special enrollee, coverage under your self-funded benefit plan will become effective on the date of the qualifying event. Failure to submit the request and supporting documentation within the enrollment period could result in a delay in coverage under your self-funded benefit plan. If you are unable to obtain the supporting documentation within the enrollment period, do not delay your enrollment request. 9

10 Dependent Child Enrollment A dependent child acquired by the member while coverage under your self-funded benefit plan is in force, will be covered as follows: Newborn child a child born to a member while the member s coverage is in force is automatically covered from the moment of birth if no additional contribution is required to cover such child. When additional contribution is required to cover the child, the member must submit an Employee Eligibility Statement with the newborn s information within 31 days after the date of birth. Adopted child an adopted child is covered from the initial placement. The member must submit an Employee Eligibility Statement, Special Enrollment Form (AD41) and supporting adoption documentation within 31 days after the initial placement. Stepchild a stepchild is covered on the date of the marriage of his parent and stepparent. The member must submit an Employee Eligibility Statement, Special Enrollment Form (AD41) and supporting documentation within 31 days after the event. The approved qualifying events are as follows: Loss of Coverage a. Job termination b. No longer eligible company policy (i.e., dependent coverage is no longer offered, etc.) c. COBRA benefits have expired Contribution Change a. Contribution (increase/decrease in employer contribution level) Life-Changing Events a. Adoption of a child b. Divorce c. Marriage d. Birth of a child d. Legal Separation Misstatement on the Employee Eligibility Statement The Employee Eligibility Statement or other similar form, which captures information regarding medical conditions and treatment of eligible persons, is made part of the application for insurance and shall be relied upon in determining rates and eligibility for coverage. Trustmark has the right to revise the rates (retroactively or prospectively) for the stop-loss insurance contract, or terminate the stop-loss insurance contract if a person completes the Employee Eligibility Statement or other similar form with false, incomplete or misleading information that results in a material misrepresentation affecting the assessment of the risk or the terms or conditions for coverage. Trustmark has the right to make any adjustment or denial of benefits due to the material misrepresentation. An Employee s coverage may be rescinded or terminated, and claims may be denied for fraud or intentional misrepresentaions of material fact when completing the Employee Eligibiity Statement, or similar accepted form, with false, incomplete or misleading information. Thirty days advance written notice will be provided to the Participant prior to any rescission of coverage. Medicare Medical benefits for employees or spouses who are age 65 and over will be paid secondary to Medicare when an employer has fewer than 20 employees. Covered charges will be reduced by any benefits payable by Medicare. When an employer has 20 or more employees and is subject to the Social Security Act (Section 1862(b)), medical benefits will be paid primary to Medicare. This may result in an increase in the payment amount. An employee may choose to voluntarily waive coverage under your self-funded benefit plan and elect Medicare as sole payer. To determine employer size, Medicare will look at whether the employer had at least 20 employees (full- and part-time) in at least 20 weeks of the preceding or current calendar year. You must notify us of any changes in group size relevant to administering benefits under Medicare or federal law. 10

11 Waiving Coverage Under Your Self-Funded Benefit Plan If an employee declines coverage under your self-funded benefit plan and/or dependent coverage when eligible, he must complete and sign the Waiver of Coverage section on the Employee Eligibility Statement. Coverage should be waived within the initial enrollment period whenever possible. If the employee and/or his dependents waive the coverage under your self-funded benefit plan and they do not have a qualifying event to be added to the plan, the employee and/or his dependents will not be permitted to enroll in coverage until the annual open enrollment period. See the section, How to Enroll Employees and Dependents, and the notice regarding Special Enrollment Rights attached to the Employee Eligibility Statement for additional information. 1. Employee Termination Termination of Coverage Under Your Self-Funded Benefit Plan When an employee terminates employment, complete and submit the Termination/Waiver section on the back of the monthly billing statement to notify us of the change. Coverage under your self-funded benefit plan will terminate on the last day of the month in which the employee worked. If coverage terminated on or after the first day of the month, coverage will continue and payment will be requested for the full month. Notification to terminate employee coverage should be sent to us as quickly as possible. We will not retroactively credit your billing amount. See the Plan Document for more details on termination. 2. Employer Termination If you are terminating your company s self-funded benefit plan and stop-loss insurance coverage, submit a written notice prior to your next due date indicating that coverage is to be terminated. Stop-loss coverage will be terminated at the end of the billing period in which the request is received by us and payment has been made. Reminder: If payment has been received for the current billing period, we will not retroactively terminate your coverage or credit any payment. Trustmark Life Insurance Company can terminate your stop-loss insurance contract for the following reasons: a. If we do not receive your monthly payment within 31 days of the due date, your stop-loss insurance coverage terminates as of the due date. b. If the group fails to meet participation requirements, the stop-loss insurance contract and Administrative Services Agreement may be terminated on any due date with 31 days advance notice. c. The group submits a voluntary written request for termination. d. The business moves to a state where we do not write business. e. The business is no longer engaged in the same business that it was on the date the stop-loss insurance contract was effective. f. There is evidence of fraud or misrepresentation. g. There is noncompliance with plan provisions. 3. Terminations Mid-Contract Year If your stop-loss insurance contract terminates before the end of the contract period, the annual aggregate attachment point will be deemed not satisfied. Therefore, we will process claims, with dates of service during the time the contract was in force, to the earliest of the end of the runout period or when the balance of the aggregate claim liability account is depleted. Any claims over this amount will be your responsibility. If a claim is made during this time against the Specific Attachment Point, you are responsible for funding the Specific Deductible. 4. Runout Period The Runout Period is the period after the end of the contract year, during which claims incurred during the contract year will continue to be paid. During the runout period, you will continue to receive the monthly Aggregate Claim Liability Report until final accounting is complete. After the run-out period has ended, claims incurred during the contract period will not be processed by Starmark and will be returned to the provider of the service. 11

12 Continuation of Coverage When you employ 20 or more full- and part-time employees for more than 50% of the working days in the previous calendar year, your employees qualify for continuation under the federal law, COBRA. COBRA compliance is your responsibility. Any COBRA notices must be on your letterhead or other form provided by you. Please contact your legal counsel for further information. Miscellaneous Administration 1. Clerical errors by us shall not invalidate a member s coverage under your self-funded benefit plan. This includes errors in enrolling, recording or reporting for coverage purposes. 2. We give you a Plan Document for each enrolled employee or provide it online for employees that have opted-in to the Starmark Document Center. The document describes benefits for covered employees and any dependents. 3. Visit the Starmark website at to download forms. 4. You must provide us with information to administer your self-funded benefit plan. Information is required when an eligible employee becomes covered, when changes in amounts of coverage occur and when a member s coverage terminates. 5. Upon request, we will provide each employer with any information we have available to prepare Schedule A 5500 Forms. Participation Requirements 1. Prior to each new contract year, you will be required to submit an Employer Certification form to verify the number of employees eligible to participate in the self-funded benefit plan. You will also be asked to provide updated contact information and employee addresses. 2. To receive a new plan year offer, you will be required to meet the participation requirements. Using Your Self-Funded Benefit Plan 1. Claim Filing Instructions Members or their providers (doctors and hospitals) should file claims as specified on the medical ID card. An explanation of benefits (EOB) will be sent to the member at his home address to show how payment was distributed. 2. Precertification Procedures To initiate the precertification process, the member must call the precertification network at the phone number provided on the medical ID card prior to any of the following requested medical procedures: Inpatient hospital stays, including maternity Organ and bone marrow transplants Home health care Home infusion therapy, including chemotherapy Outpatient radiation and chemotherapy Hospice care Acute inpatient rehabilitation stays Long-term acute rehabilitation Subacute inpatient medical and rehabilitation 12

13 Skilled nursing stays Inpatient and residential mental illness, nervous disorders, alcohol abuse and chemical abuse Outpatient diagnostic imaging tests including, but not limited to, CT, CTA, MRI, MRA, PET, PET CT and 3D Rendering Precertification is not required for outpatient surgeries. In the case of an emergency admission, precertification must be completed by calling the phone number provided on your medical ID card within 48 hours after care begins or by the next regular working day. If precertification procedures are not followed, you will be charged a penalty. Note: Precertification requirements may vary by network. Refer to the plan document for more details. 3. Prescription Drug Benefit If applicable, prescription drug benefit information is provided on the medical ID card. Prescriptions can be filled at a participating retail pharmacy or using mail service. Non-Covered Prescription Drugs (for plans with a prescription drug card) Prescription drugs not covered under the prescription drug card may be covered under your self-funded benefit plan subject to the deductible, coinsurance and other benefit plan provisions. These bills should be submitted to the address on the medical ID card. See the Plan Document for additional details. If members have questions regarding the prescription drug benefit, they should call the prescription drug benefit manager s customer service number shown on the medical ID card. Coordination of Benefits Coordination of benefits will apply when benefits that would be paid under all of the member s plans exceed the allowable expense. When coordination of benefits applies, benefits payable under your self-funded benefit plan may be reduced. They will be reduced so that the sum of the benefits paid under your self-funded benefit plan, plus benefits payable under all other plans, do not exceed the total allowable expense. Benefits payable under other plans include benefits that would be paid if the member made the claim. The rules for the order of benefit payment are summarized below. When your self-funded benefit plan must pay first, coordination will not apply. 1. Nondependent/Dependent. A plan which covers a person other than as a dependent will pay before a plan which covers that person as a dependent. If, however, the person is also a Medicare beneficiary, Medicare is: a. Secondary to the plan covering the person as a dependent; and b. Primary to the plan covering the person as other than a dependent. 2. Dependent Child/Parents not Separated or Divorced. A plan that covers a child as a dependent of a parent whose month of birth occurs earlier in a calendar year will pay before a plan that covers the same child as a dependent of a parent whose month of birth occurs later in a calendar year. If both parents have the same birthday, the plan that has covered a parent for the longer period will pay first. 3. Dependent Child/Separated or Divorced Parents. If two or more plans cover a person as a dependent of separated or divorced parents, benefits for the child are determined in the following order: a. The plan that covers the child as a dependent of the parent with custody of the child; b. The plan that covers the child as a dependent of the spouse of the parent with custody; and c. The plan that covers the child as a dependent of the parent without custody of the child. 13

14 However, if the specific terms of a court decree state that one of the parents is responsible for the child s healthcare expenses, the benefits of that plan are determined first. 4. Continuation. A plan covering a person as an employee or dependent shall be primary to a plan covering that person under state or federal continuation. This subsection shall not apply if the other plan does not contain an order of benefits determination and the plans do not agree on the order. When these rules do not establish an order of payment, the plan that has covered the person for the longer period of time will pay first. Two plans shall be treated as one if the claimant was eligible under the second plan within 24 hours after the first plan ended. For further details, refer to the Plan Document. Glossary Annual Open Enrollment: Eligible employees may enroll themselves and their eligible dependents during the annual open enrollment period, which is the month prior to the start of the new plan year. Employee Eligibility Statements for new enrollees must be signed and received by Starmark Administration prior to the end of the open enrollment period to be accepted for processing. Claim: A request for payment of benefits covered under the Plan Document. A bill from the provider is needed to pay medical claims. COBRA: A federal law that requires an employer to offer an employee or his dependents an extension of benefits if the employer employs 20 or more employees (full- or part-time). The duration of the extension will depend upon the qualifying event. See the Plan Document for more details. Coinsurance: The percentage of covered charges payable by the member. For example, if the benefit plan pays 80% of covered charges, the coinsurance for the member would be 20% of covered charges. Contract Year: The 12-month period during which the stop-loss insurance contract or your self-funded benefit plan, if applicable, is in effect. Coordination of Benefits: Taking other plans into account when paying benefits. Copayment: The amount of the office visit charge that a member must pay when services are rendered by a preferred provider. This amount does not apply toward satisfaction of any deductible, but applies to the out-of-pocket limit. Deductible: The amount of covered charges a member must pay before any benefits are payable. Due Date: The date your payment is due to us. The due date is noted on the Billing Statement. Dependent: A person who resides in the United States and who is the eligible employee s: 1. Legally married spouse, or domestic partner. 2. Natural child(ren), legally adopted child(ren) or step-child(ren) who are under the age of Child who has coverage in force, who has reached the limiting age, is incapable of self-sustaining employment and is dependent upon the employee or dependent or other care provider(s) for lifetime care and supervision. The employee must give us proof of the child s incapacity and dependency within 31 days after the date the limiting age is reached in order to continue coverage under your self-funded benefit plan. The employee may also be required, from time to time, to give proof of his continuing incapacity and dependency. If proof is not given within 60 days of a request, his coverage will end 60 days after the request is made. 14

15 4. Natural child(ren), legally adopted child(ren) or stepchild(ren) who are under the age of 26. Notwithstanding the above, the following are not considered to be dependents: a. A person who is eligible for coverage as an employee. b. A child who is a foster child. c. A child who is eligible for any other employer-based medical plan as an employee. d. A child who is covered as a dependent of another employee. Eligible Employee: A person who is working for the employer for at least 25 hours per week, has satisfied the waiting period, if any, required by the employer, and is a member of a class eligible for coverage. A person may be considered an eligible employee if they are not actively at work due to hospital confinement or disability. Explanation of Benefits (EOB): A statement that explains how benefits are payable and how they are distributed. Initial Enrollment Period: The 31 days immediately following the waiting period established by the employer. Lapse: Termination of the stop-loss insurance contract due to nonpayment after the grace period has ended. Member: An eligible employee or dependent whose coverage under your self-funded benefit plan has become effective. Misstatement: Any information that is not correctly written on the Employee Eligibility Statement. Monthly Billing Amount: The amount of money the employer pays each month for the employee s benefit plan. Our: Starmark or Trustmark. Participation: The number of eligible employees that must be enrolled in your self-funded benefit plan for you to be eligible for coverage under the stop-loss insurance contract. At least 75% of eligible employees must be enrolled. Provider: A physician or hospital that provides medical services. Reinstatement: Making your coverage under your stop-loss insurance contract effective again after a termination and all overdue payments are made. Runout Period: The period after the end of the contract year, during which claims incurred during the contract year will continue to be paid. Special Enrollee: An employee or dependent who previously waived coverage under your self-funded benefit plan, but may now be eligible because he has involuntarily lost his other coverage, had a benefit/coverage change, or a life-changing event. State Quarterly Wage and Tax Statement: A form each employer must file with the state on a quarterly basis. It lists all employees working for the employer and their salaries. Timely Enrollee: An eligible employee who completes and signs the Employee Eligibility Statement on behalf of himself and/or his dependents during the waiting period and prior to the end of the initial enrollment period. Us: Starmark or Trustmark. Waiting Period: The amount of time the employee must be employed before he is eligible for coverage under your self-funded benefit plan. The waiting period cannot exceed 90 days. Waiver of Coverage: A request from an employee to not be included under your self-funded benefit plan provided by You. We: Starmark or Trustmark. You/Your: Employer 15

16 Our mission: Helping people increase well-being through better health and greater financial security. Trustmark: An employee benefits company for more than 100 years The Trustmark Companies serve more than 2 million covered lives or plan participants. Trustmark Life Insurance Company is rated A- (Excellent) by A.M. Best. Starmark: Serving the healthcare benefit needs of employer groups for 30 years Starmark administers self-funded health benefit plans, offering extensive plan design choices, exceptional personal service and nationwide provider access. Starmark The leader in self-funding for small groups. Plan design availability and/or coverage may vary by state. Self-funded plans are administered by Starmark, and stop-loss insurance coverage is provided by Trustmark Life Insurance Company. Starmark administers self-funded health benefit plans, offering extensive plan design choices, exceptional personal service and nationwide provider access. Starmark The leader in self-funding for small groups. 400 Field Drive Lake Forest, IL Star Marketing and Administration, Inc. AD44sf-er (11-17)