High Deductible Health Plan Enrollment and Administration

High Deductible Health Plan Enrollment and Administration Caroline Smart, Director of Health Plan Operations October 2014

Presentation Overview ACA Requirements Statutory Requirements Workgroups Board of Trustee Approvals Rates Plan Design & Benefits TPA Contract HDHP Administration HDHP Open Enrollment 2

ACA Requirements Newly Eligible Employees To avoid tax penalties under section 4980H of the Internal Revenue Code (the Code) large employers must offer coverage that is affordable, and is at least minimal value to all full-time employees. Employees are considered full-time, and thus required to be offered employersponsored health care, if they are reasonably expected to work 30 hours per week. Employing units are responsible for determining whether or not an employee is a full-time employee. This includes all non-permanent employees. Nonpermanent employees are currently not offered coverage through the State Health Plan. Employers have flexibility in determining an employee s status and may use a safe harbor which utilizes a measurement and stability period for determining eligibility and offering coverage. If the safe harbor is not used then employee status is determined every month. The State Health Plan is not able to provide guidance to employing units regarding eligibility for employees. Additional information is posted on the Plan s website under the HBR tab. Click Health Care Reform/Affordable Care Act Information 3

Statutory Requirement to Offer Alternative Benefit Section 35.16 of SL 2014-100 (SB 744 Appropriations Act) establishes a new health benefit eligibility category for full-time employees not otherwise covered by the Plan to comply with the Affordable Care Act (ACA) The Affordable Care Act (ACA) and section 4980H of the Internal Revenue Code (the Code) prescribe updated definitions of full-time employees and requirements to determine which employees are required to be offered employer-sponsored health care Employees are determined to be full-time, and thus required to be offered employer-sponsored health care, if they are reasonably expected to work 30 hours per week Directs the Treasurer and Board to offer a health benefit coverage option for these newly eligible employees that provides minimum essential coverage at no greater than the ACA Bronze level and that minimizes the employer contribution in an administratively feasible manner 4

ACA Requirements Newly Eligible Workgroup The Plan formed a workgroup to build consensus on an administrative approach and plan design options for these newly eligible employees. The workgroup consists of representatives from: Office of State Human Resources (OSHR) Department of Public Instruction (DPI) University System General Administration (UGA) Community College System Office Cross-Section of Public Schools Wake County Public Schools Charlotte-Mecklenburg Public Schools Guilford County Public Schools Orange County Public Schools 5

Workgroup Recommendations: Rate Structure Rate Structure We presented three options to the workgroup for the assignment and billing of the employer and employee share of the monthly premium: 1. Pay Bands Member will be enrolled by the HBR into one of four pay bands which will determine the employer and employee share of the premium or 2. Single Rate with employer/employee share defined - which means all employees will be charged the same premium rate or 3. Single Rate to employer - employer determines what rate to charge the employee Workgroup determined that Option 2 was the most administratively feasible option. 6

Workgroup Recommendations: Member Premium Billing Member Premium Billing We provided two options for consideration 1. Direct Bill Member will receive a monthly premium bill which must be remitted on time to avoid termination or 2. Group Bill Group responsible for collecting member s portion of the premium. Late terminations for arrears will not be accepted. Workgroup recommended Option 1 be the standard member billing methodology. By direct billing the member, instead of utilizing payroll deduction, the Employing Units do not have to build a premium collection process for payroll periods for which the member does not receive a paycheck. 7

Workgroup Comments: Minimum Value Plan While we did not ask for a recommendation, we did request feedback on providing a Minimum Value Plan for these members. The group was supportive of this offering. Additionally, they believe other employees might be interested in this option as well. Benefit Design Individual Coverage Family Coverage Individual Deductible $5,000 $10,000 Out-of-Pocket Maximum $6,450 $12,900 Coinsurance 50% 50% Preventive Medical Covered at 100% Preventive Pharmacy Covered at 100% Plan design meets ACA minimum value standard Plan design is eligible for a Health Savings Account which allows the employee to make 2015 tax-exempt contributions of up to $3,350 ($6,650 for family coverage) to an account that can be used to pay eligible medical expenses. 8

Board of Trustees Approval In late August, the Plan s Board of Trustees (BOT) approved: Rates and Rate Structure (See next slide) Plan Design: High Deductible Health Plan (HDHP) TPA contract: MedCost 9

Monthly Premium Rates for High Deductible Health Plan (HDHP) Coverage Type Employer Share Employee Monthly Premium Dependent Monthly Premium Total Monthly Employee Premium Employee-only $117.62 $92.38 N/A $92.38 Employee + Child(ren) $117.62 $92.38 $169.78 $262.16 Employee + Spouse $117.62 $92.38 $376.56 $468.94 Employee + Family $117.62 $92.38 $470.56 $562.94 10

Final High Deductible Health Plan (HDHP) Summary Plan Features In-Network (Individual Coverage In-Network (Family Coverage) Out-of-Network (Individual Coverage Out-of-Network (Family Coverage) Medical Coverage Deductible $5,000 $10,000 $10,000 $20,000 Coinsurance 50% 50% 60% 60% Out-of-Pocket Maximum (Medical and Pharmacy) $6,450 $12,900 $12,900 $25,800 ACA Preventive Care Services $0 (covered at 100%) $0 (covered at 100%) 60% after deductible 60% after deductible Office Visits 50% after deductible 50% after deductible 60% after deductible 60% after deductible Specialist Visit 50% after deductible 50% after deductible 60% after deductible 60% after deductible Inpatient Hospital 50% after deductible 50% after deductible 60% after deductible 60% after deductible Prescription Coverage 2015 Express Scripts National Formulary Covered Prescription Drugs HDHP ACA Preventive Medications 50% after deductible 50% after deductible 50% after deductible 50% after deductible $0 (covered at 100%) With a Prescription $0 (covered at 100%) With a Prescription $0 (covered at 100%) With a Prescription $0 (covered at 100%) With a Prescription 11

HDHP Summary-Con t. Instead of copays, members will pay a 50% coinsurance after meeting the deductible for in-network medical and pharmacy expenses, except for ACA preventive services and medications. The deductible and coinsurance (medical and pharmacy) are included in the out-of-pocket maximum. ACA Preventive Services and Medications ACA medical preventive services are covered at 100% ACA preventive medications are covered at 100% with a prescription A list of these services and medications will be available on the Plan s website at www.shpnc.org 12

Additional HDHP Member Services through MedCost Teladoc 24/7- Access to consultations over the phone or online (where available) with board certified physicians for common conditions such as allergies, infections, etc. The out-of-pocket cost to the member for this service will be $40.00 per use of service. A welcome kit from Teladoc will be sent to enrolled members. HealtheReports - Online provider search, cost and quality tool Personal Care Management - Customized health education and oneon-one nurse mentoring and coaching to encourage self-empowerment and self-management. Includes transitional care management. Personal Health Suite - Online suite of health and wellness tools and information, including Health and Productivity Assessment (HPA), Healthy Living Programs, personal health record/portal and health trackers 13

HDHP Pharmacy Benefit Members will pay in full for prescription drugs if the deductible has not been met. Pay in full means you will pay 100% of the covered prescription drug cost Once the deductible is met, members will pay a 50% coinsurance for prescriptions until the out-of-pocket maximum has been met. This pharmacy benefit will use the 2015 Express Scripts National Preferred Formulary (preferred drug list) and includes their broad retail pharmacy network. 2015 Express Scripts National Preferred Formulary (preferred drug list) will be posted on the State Health Plan s website. 14

HDHP: Health Savings Account Compatible The HDHP is compatible with a Health Savings Account (HSA). An HSA is a tax-deductible savings account with tax-free withdrawals for qualified medical and pharmacy expenses. Having an HSA is not required to be enrolled in this plan. An HSA can be helpful in reaching the deductible and ease the out-of-pocket burden on an HDHP. Enrolled members will be responsible for setting up their own HSA. 15

HDHP Administration Information Claims Processing/Customer Service Members in this plan will have access to the MedCost PPO Provider Network for medical services. Pharmacy Administration The Pharmacy benefit will be managed by Express Scripts and will use Express Scripts 2015 National Preferred Formulary. Enrollment and Billing Enrollment and billing will be provided by COBRAGuard. Eligible members will not use eenroll to enroll in the HDHP. Billing The standard premium billing practice will be to send a monthly premium bill directly to the member and a group premium bill to the employing unit. Groups that want to handle the premium deductions for their employees may contact the Plan for an exception. 16

HDHP Employer Portal Billing Employing units will be able to view the employer invoice on the portal. Member invoices will be integrated on the member portal (shphdhp.com) Invoices are generated on the 10 th of each month. Invoices are viewable online under the Invoices Menu Option. Once an invoice is opened in the system, it will show two options to pay the bill: Mail a check to the lockbox Click to pay online via ACH Once payment is received the invoice will be satisfied. The satisfied invoice will be viewable under the Invoice Tab. Billing reports are included in the system. If the member payment is not received by the end of the grace period the member will be terminated and the employer portion will be refunded on the next invoice.

HDHP Open Enrollment Employing Units are in various states of readiness; therefore, we have established three Open Enrollment (OE) periods: October 6 31 Allows employing units to offer HDHP OE during the same period as the Traditional Plan OE for permanent employees. Ensures ID cards will be in members hands by January 1 st. November 1 30 HDHP OE will begin the day after the Traditional OE ends. Ensures ID cards will be in members hands by January 1 st. November 20 December 19 Allows the most time for employing units to determine eligibility while still completing OE by the Christmas holiday. ID cards will not be in members hands by January 1. As a reminder, any group not able or ready for any of the scheduled OE dates are able to add members for the initial enrollment just as they do for any new hire. 18

HDHP Open Enrollment Reminders During Open Enrollment you are able to: Enroll in the State Health Plan Add dependents without a qualifying life event An eligible dependent of a covered employee includes: Legal spouse Children up to age 26, including natural, legally adopted, foster children, children for which the employee has legal guardianship and stepchildren of the employee Coverage for such children (described above) who are covered by the Plan when they turn age 26 to the extent that they are physically or mentally incapacitated on the date that they turn age 26. A child is physically or mentally incapacitated if they are incapable of earning a living due to a mental or physical condition. Coverage continues for such children as long as the incapacity exists or the date coverage would otherwise end, whichever is earlier. It is essential that dependent verification documentation is maintained on all dependents (e.g., birth certificate, marriage certificate, court orders) Outside of Open Enrollment you may not add or remove dependents or disenroll from the State Health Plan unless you experience a qualifying life event, such as marriage, birth, death or retirement, and those changes must be made within 30 days of the event. 19

HDHP Open Enrollment Guides HBRs will be sent a pdf of the Enrollment Guide for eligible members. HBRs are responsible for sending the guide to eligible members. The guide will not include enrollment dates, so you will need to promote when your employing unit will be hosting Open Enrollment for this plan. The State Health Plan s website will have one page dedicated to this plan in which the following materials will be available soon. To access this information, employees will need to visit www.shpnc.org and click High Deductible Health Plan. ACA Preventive Services List HDHP ACA Preventive Medication List 2015 Express Scripts National Preferred Formulary (preferred drug list) Benefit Booklet HDHP Summary 20

Appendix 21

Frequently Asked Questions (FAQs) If an employee has the high deductible plan coverage, and they lose their job, is this plan eligible for COBRA continuation? Yes, members enrolled in this plan are eligible for COBRA. If they waive coverage do we still have to enter them into the system? Yes, all eligible employees should be loaded into the system to allow for them to enroll or waive coverage. Those who do not enroll within the appropriate timeframes will not be eligible to enroll until the next Open Enrollment. Does coverage begin Jan. 1 or Feb. 1? What are the effective dates for coverage? Coverage will begin Jan. 1, 2015. The benefit period is Jan.1, 2015, through Dec. 31, 2015. What happens when an employee stops paying premiums? If an employee does not pay their bill, they will be terminated from coverage due to non-payment. 22

Frequently Asked Questions (FAQs) What is the grace period for canceling coverage for non-payment? Premium payments are due by the first of the effective month. Members who do not pay by the end of the effective month will be terminated the first of the following month. Can the employer portion only be paid by going online? Can paper checks be submitted? Yes, employers will be able to pay online and paper checks will be accepted. Are charter schools required to participate? Yes, charter schools are required to participate. How will we know if an employee has paid their premium before we pay the employer share? Groups are required to pay as billed. The group premium payments are due by the first day of the effective month. Groups will receive a premium credit on a subsequent month for any employees that are terminated for nonpayment. The HBR portal will display terminated members. 23

Frequently Asked Questions (FAQs) Will we have the ability to send eligibility files or is this a one-by-one approval? Initial enrollment can by uploaded from a file or loaded manually one by one. Please contact the State Health Plan at HBRInquiries@nctreasurer.com if you are interested in utilizing EDI for ongoing enrollment maintenance. When will the premiums be due for the employee and the employer? Both group and employee premium payments are due in full by the first day of the effective month. Can employees decline this coverage? Yes, they are able to decline coverage. Is there a billing module in this system to see who has paid their premiums? Yes, the HBR portal will have a billing functionality to allow you to view employees. 24

Frequently Asked Questions (FAQs) If this person is a retiree and they decline, will that affect their insurance being paid by the Retirement System? If an employee qualifies for this coverage, they are no longer eligible for Plan coverage under the Retirement System. We noticed that the coinsurance is 50%. Doesn't ACA require that minimal essential coverage be 60%? Yes, but coinsurance is not the same as minimum value. Although the coinsurance is 50%, preventive services are covered at 100% and the overall value of this plan meets the minimum required value of 60% under the ACA. Will HBRs be receiving website and login information prior to Open Enrollment? Yes, HBRs will receive portal information including login credentials in the coming weeks. 25

Frequently Asked Questions (FAQs) Has there been any discussion regarding payroll deduction? Will this be an option or is it all going to be direct billed? Providing a direct bill for these employees will be the standard approach. Groups interested in using payroll deductions for their members may contact the Plan at HBRInquiries@nctreasurer.com for an exception. Does the employer have to provide the email address for employees on the census load so the employee can register? No, an email address will not be required for a member to enroll online. How will we be getting the group bill? Are premiums paid in advance? Who's responsible for reconciling premiums and tracking employee payment to ensure we pay the right amount? This is an ebilling system; therefore, your premium bill will be available on the COBRAGuard billing portal. Premiums will be due on the first day of the effective month. Groups are responsible for reconciling their bills on a monthly basis. Groups may contact COBRAGuard with any questions about their bill. 26

Frequently Asked Questions (FAQs) BCBSNC requires that we pay the bill as sent without manual reconcile. Will this billing be the same? The Plan requires all groups to pay as billed. Groups should reconcile their bills monthly and make adjustments via the enrollment portal as needed. What is the deadline to enroll employees in this plan for the Jan. 1 effective date? Our admin period doesn't start until November. There will be a second Open Enrollment period in November that may work for your group. As with any new hire, these newly eligible employees can be loaded throughout the year as they become eligible. Ideally they need to be enrolled prior to their effective month to avoid access to care issues. Will we have to approve tasks like in eenroll? Yes, it will be very similar to eenroll in that you will have to approve an employee s activity in the enrollment system. 27

Frequently Asked Questions (FAQs) You stated that the member will receive a bill monthly for the premiums. Will the employer not be responsible for submitted payment on behalf of these newly eligibles? No, COBRAGuard, the Plan s billing administrator, will be billing the members monthly. Employers will not have to bill employees for this plan. Will someone from COBRAGuard be reaching out to design census files? Yes, COBRAGuard will be sending a template of the census file to groups. How will we be billed and how will we make payment? Employing units will be able to log into the portal and view their invoice. You will be able to submit payment via ACH or by check. If employee enrollment is effective Jan. 1, does that mean they will have to pay premiums in December? January premiums are due by Jan. 1, 2015. 28

Frequently Asked Questions (FAQs) How will we be made aware of changes that an employee makes on their own? HBRs must approve any qualifying life event changes. Additionally, HBRs have access to various employee reports and can view the employees records. Will employees pay premiums current or one month in advance? Employees will receive a bill the month before payment is due. How current will the billing report be? The bill will be as current as the enrollment entered the day before the bill run. Who notifies MedCost of life event changes the EE or ER? If EE, how is the ER notified? Members enter the life event and the HBR must approve it. 29

Frequently Asked Questions (FAQs) Are employers given a choice as to whether premiums are collected by COBRAGuard, or the agency? Providing a direct bill for these employees will be the standard approach. Groups interested in using payroll deductions for their members may contact the Plan at HBRInquiries@nctreasurer.com for an exception. How is the portal accessed by HBRs? The portal is a web-based system and HBRs will be given the link to access it, but it will also be available on the Plan s website under the HBR tab as a resource. How do we work out an enrollment time if Oct. 6 will not work? There will be a second Open Enrollment in November (currently scheduled to begin Nov. 20). 30

Frequently Asked Questions (FAQs) "Part Time Open Enrollment" - is this another name for HDHP Open Enrollment? Eligible employees are not part-time employees. Some employing units may be calling the HDHP Part Time Open Enrollment but that is not accurate. Can you give some examples of work schedules which would qualify for this HDHP? Any employee who meets the definition of a full-time employee under the Internal Revenue Code, i.e., an employee with 30 hours of service or more per week during a month or with 130 service hours in a month, is eligible for coverage. This could include employees acting as substitute teachers or filling other positions on a temporary basis. How many months running does a non-permanent employee need to work full time before the HDHP is required to be offered? Any employee who meets the definition of a full-time employee under the Internal Revenue Code, i.e., an employee with 30 hours of service or more per week in a month or with 130 service hours in a month, is eligible for coverage. How? G 31

Frequently Asked Questions (FAQs) If we use the Safe Harbor method for these non-permanent employees, would we need to use the Safe Harbor method for our permanent employees (to determine if working 30 hours per week)? Yes, in order to avoid IRS penalties, you must identify any common law employee regardless of how classified (permanent or otherwise) and offer those employees coverage that is affordable and has minimum value. Keep in mind that permanent full-time employees, those employed in permanent job positions on a recurring basis who work 30 or more hours per week for nine or more months per calendar year, are eligible for other coverage with the State Health Plan and not the HDHP. How and when do we get set up for ACH payments? Once you have access to the portal, you will be able to sign up for ACH. So just to clarify, for any special requests needed for the HDHP coverage, we will use the same exception process that we use now for the standard plans? The process will be the same. We will update the form so you can identify the exception as an HDHP exception. G 32

Frequently Asked Questions (FAQs) Who do we contact to set up the Open Enrollment period for our school system? If you are unable to use either the October or November Open Enrollment periods, you must contact the Plan at HBRInquiries@nctreasurer.com for an exception. How can members enroll in a Health Savings Account (HSA)? Various banks and credit unions offer an HSA. Eligible members are responsible for setting up their own Health Savings Account. To clarify on COBRAGuard: HBRs will need to log into the Dashboard and select "Census Upload" to load the file and to notify you of those employees that are newly eligible? Yes, HBRs will need to load eligible members by using the upload feature. 33

Frequently Asked Questions (FAQs) Will SHP provide an enrollment form for employees to complete if they cannot enroll online? Enrollment will only be available online. Members without computer access will be able to call to enroll. Will the HBR be responsible for entering all key data on an eligible employee? Yes, HBRs will be responsible for uploading information on eligible employees. What about waivers if an employee is already covered under spouse, do they decline like current employees? Yes. The Employing Unit has to show that it made the offer of coverage and so it is important to capture when an employee declines coverage. Must they decline each year, and in an Open Enrollment period? Yes. The Employing Unit has to show that it made the offer of coverage and so it is important to capture when an employee declines coverage. 34

Frequently Asked Questions (FAQs) Will you explain the difference between the department census and the enrollment report once again? The department census shows all employees (and dependents, if selected) that are actively enrolled in benefits. If an employee has waived coverage they will show on this report as well. The enrollment report will show all pending enrollments for employees and dependents, as well as the pending benefit the employee has selected. 35

Thank you! 36 www.shpnc.org www.nctreasurer.com