Health Benefit Options for GCDs, Julian Fontana, TML IEBP


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Health Benefit Options for GCDs, Julian Fontana, TML IEBP

  1. 1. 2011-2012 Texas Allianceof Groundwater Districts
  2. 2. TML IEBP Mission StatementTo provide excellent service and administrative services to eligible municipalities in Texas by utilizing innovative, affordable alternatives while maintaining financial integrity. Exclusive to Public Sector Public &Not-for- Member Private Profit Equity Sector
  3. 3. Alliance RelationshipTML IEBP IS THE VALUE ADDED SOLUTION
  4. 4. 4 Political Subdivisions010-2011 Category Groups Lives Category Groups Lives Assistance League 1 50 Municipal Water Authority 2 12 Association of Governments 1 6 Municipal Water District 1 10 City 454 20,316 Navigation District 1 8 Conservation District 6 11 Police Department 1 17 Council of Governments 10 902 Port Authority 1 14 County (or Central) Appraisal District 73 837 Public Utility Board 2 68 County Irrigation District 1 8 Public Utility District 1 1 Drainage District 4 27 Regional Planning Commission 5 247 Emergency Communication District 12 64 Risk Pool 3 388 Emergency Medical Services District 8 105 River Authority 5 350 Emergency Service District 8 76 Special Utility District 15 115 Fresh Water Supply District 5 31 Transit District 2 79 Health District 2 313 Underground Water Conservation District 11 52 Hospital District 7 169 Voluntary Fire Department 1 21 Housing Authority 99 610 Water Authority 2 13 Improvement District 2 14 Water Conservation & Improvement District 20 186 Irrigation District 1 31 Water Improvement District 4 33 Library District 5 12 Water Supply District 5 31 Municipal Utility Authority 1 21 Water/Wastewater District 5 97 Municipal Utility District 18 116 Grand 805 25,461
  5. 5. Cost Management in the New World 5Per Employer Per Year (PEPY) Cost of Healthcare: Medical w/Rx Pool Industry Standard 10,475 9,821 9,028 8,449 7,970 7,516 7,140 6,616 6,370 6,059 5,837 6,070 6,000 5,421 5,126 5,026 5,0484,843 2004 2005 2006 2007 2008 2009 2010 2011 2012
  6. 6. 6 Healthcare FactsPatient Protection Affordable Care Act (PPACA) Affordable Care Act (ACA) Is Healthcare a Privilege or a Right? Resources: 1,14,12 - Issue Brief/Utilization Review Accreditation Commission (URAC)
  7. 7. 7 Healthcare Tourism Procedure US India Thailand Singapore Heart Bypass $130,000 $10,000 $11,000 $18,500 Heart Valve Replacement $160,000 $9,000 $10,000 $12,500 Angioplasty $57,000 $11,000 $13,000 $13,000 Hip Replacement $43,000 $9,000 $10,000 $12,500 Hysterectomy $20,000 $3,000 $4,500 $6,000 Knee Replacement $40,000 $8,500 $10,000 $13,000 Spinal Fusion $62,000 $5,500 $7,000 $9,000
  8. 8. 8 Healthcare Facts• Patient Protection Affordable Care Act – March 23, 2010 - Signed by the President – March 30, 2010 - Amended by Health Care and Education Affordability Reconciliation Act – Healthcare Reform Estimated Funding Required: $829B - $900B• Healthcare Costs are in excess of 15% of Gross National Product.• Starbucks spends more on healthcare than coffee beans.• General Motors spends more on healthcare than on steel.
  9. 9. 9 Healthcare Facts• Medicare Expansion- The U.S. could face a shortage of Primary Care Physicians by 2025.• Uninsured Population continues to grow – Implementing healthcare for dependents to the attained age 26 increased insured population by $2.5M – Texas is identified Medicaid expansion as a cost of $24B over the next 10 years• Uncompensated Care – Uninsured population – Ineligible Care
  10. 10. 10 Healthcare Facts• Healthcare Reform Washington Debate – February 15-17, 2012 • Doc Fix Extension/Sustainable Growth Rate (SGR) – Physicians will not incur Medicare payment cuts of 27.4% and their current Medicare rates will be frozen at about a 2% increase until 12.31.12. (10 month extension-Republicans were pushing for 24 months) – Projected 1.1.13, 30% decrease in rates • Payroll Tax Extension • Unemployment Insurance Extension • Prohibition of physician owned hospitals (Delayed) – Medicare is currently estimated to be unfunded by 2017. • $300B in cuts from Medicare over 10 years means 27.4% decrease in pay (attend to doc fix amendment) • 10% of Medicare patients responsible for 2/3 of the cost)
  11. 11. 11 Health Information Technology• Health Information Technology (HITECH) Advancement/Upgrades – Conversion from ICD-9 to ICD-10 • October 2013 Delayed until October 2014 (2 Year discussion); • Expansion of Diagnosis Codes: 14,000 to more than 67,000 and procedure codes from 13,000 to 85,000 • CMS announced its intention to review ICD-10 implementation timeline using a rule based process. Possibly two year extension; 2015 ICD-11 is available
  12. 12. 12 Current Regulatory Mandates: Post PPACA 2010 Benefits All Plans Prohibition of Lifetime Maximum Dependent Coverage to Attained age 26 Pre-Existing Coverage Prohibition <19 years of age Emergency Services paid at network deductible and OOP benefit level; R&C Uniform EOB (Ombudsman) Medical Loss Ratio (non self-funded) External Appeal Process- appelant may request and independent review• Essential Benefits: ambulatory, emergency room, maternity, newborn care, mental health/substance use, behavioral health, rehabilitative, habilitative, medical devices, and laboratory- Decided by States???• Cultural & Linguistic Sensitivity
  13. 13. 2011 Cultural/Linguistic Sensitive Counties in TX 13 Highlights deleted in 2012 Andrews County Gonzales County Pecos County Atascosa County Hale County Presidio County Bailey County Hall County Reagan County Bexar County Hansford County Reeves County Brooks County Harris County San Patricio County Calhoun County Hemphill County Schleicher County Cameron County Hidalgo County Sherman County Camp County Howard County Starr County Castro County Hudspeth County Sterling County Cochran County Jim Hogg County Sutton County Collingsworth County Jim Wells County Tarrant County Concho County Karnes County Terrell County Crane County Kenedy County Terry County Crockett County Kinney County Titus County Crosby County Kleberg County Travis County Culberson County La Salle County Upton County Dallam County Lamb County Uvalde County Dallas County Limestone County Val Verde County Dawson County Lipscomb County Ward County Deaf Smith County Lynn County Webb County Dimmit County Maverick County Willacy County Duval County Midland County Winkler County Ector County Moore County Yoakum County Edwards County Navarro County Zapata County El Paso County Nueces County Zavala County Frio County Ochiltree County Garza County Parmer County
  14. 14. 14 Current Regulatory Mandates: 2010 Benefits• Health and Human Services review of unreasonable premium increase/Medical Loss Ratio (MLR) – Minimum Medical Loss Ratio: 80% for individual/small group or – 85% for larger groups (50% for tax exempt; 100% for others) 1st round of rebates due August 1, 2012 self-funded plans excluded – Self-funded Plans Exempt• Individual Healthcare Mandates, U.S. Supreme Court to hear oral argument 3.26.12 – 3.28.12 with a June 30, 2012; – Decision • Uphold individual mandate, PPACA and Medicaid expansion • Strike individual mandate, PPACA and uphold Medicaid expansion • Send back to Congress to revise by implementation date of 2014.
  15. 15. 15 Current Regulatory Mandates: 2011-2012 Benefits• Patient Centered Outcome Research Trust Fund/Comparative effectiveness research 2012- 2019; – PY ending after 10.1.12: • $1.00 PPPM with sunrise provision – PY ending on or after 10.1.14: • $2.00 PPPM; sunsets in 2019 – group of 15 experts has been created by federal health reform law• Medicare Hospital Readmission Penalty
  16. 16. 16 Evolving Healthcare Reform: 2012 Benefits• Plans after September 23, 2012 compliant with standardization of information - Summary of Benefits and Coverage (SBC)• Reporting health insurance cost on W-2 statements- reflecting COBRA eligible benefits – >250 W-2 Forms, 2012 – <250 W-2 Forms, have until 2014• Capping Flexible Spending Account contributions at $2,500 a year (Plan Years beginning after December 2012)• Wellness: NO Cost Share Benefit
  17. 17. Wellness No Cost Share Benefit 2011-2012 Wellness # EE Time Period $ Spent Lives Wellness PEPM 1/1/2011-12/31/2011 Paid $4,586,049.51 17,882 $21.37 Phase IIII Wellness Benefit: chronic disease state management (professional health coaches, nurse call lines, chronic disease state coupons), pediatric services – vision, hearing, obesity (up to age 21), colon cancer, prenatal, diabetes, cholesterol screenings, blood pressure testing, routine vaccines/ immunizations, preventive care for women (pap smears, mammograms, breast feeding education); Other: STD, smoking cessation, weight management, depression, cervical cancer, anemia, rubella, HIV, Hep A, Syphilis, Sickle Metabolic, Phenylketonuria, Lipid Disorderroutinediagnosed sexually transmitted screenings, coverage for contraceptive services at no charge, dental and vision screenings for children, prescribed aspirin, folic acid, fluoride, chemoprevention supplements, and iron deficiency supplements
  18. 18. 18 Healthcare Reform Standard Communication Summary of Benefits and Coverage (SBC) Cost Limitations &Common Medical Event Services You May Need Sharing Exceptions Primary care visit to treat an injury or illness Specialist visitIf you visit a health care provider’s office or clinic Other practitioner office visit Preventive care/screening/immunization Diagnostic test (x-ray, blood work)If you have a test Imaging (CT/PET scans, MRIs) Align/Broad Network Generic drugsIf you need drugs to treat your illness or condition (More Align/Broad Network Best Brand Drugsinformation about prescription drug coverage is available at Align/Broad Network Non Best Brand Drugswww.[insert].) Align/Broad Network Specialty Drugs Facility fee (e.g., ambulatory surgery center)If you have outpatient surgery Physician/surgeon fees Emergency room servicesIf you need immediate medical attention Emergency medical transportation Urgent care Facility fee (e.g., hospital room)If you have a hospital stay Physician/surgeon fee Mental/Behavioral health outpatient servicesIf you have mental health, behavioral health, or substance Mental/Behavioral health inpatient servicesabuse needs Substance use disorder outpatient services Substance use disorder inpatient services Prenatal and postnatal careIf you are pregnant Delivery and all inpatient services Home health care Rehabilitation services Habilitation servicesIf you need help recovering or have other special health needs Skilled nursing care Durable medical equipment Hospice service
  19. 19. 19How You and Your Insurer Share Costs - ExampleJane’s Plan Deductible: $1,500 Co-insurance: 20% Out-of-Pocket Limit: $5,000January 1st December 31stBeginning of Coverage Period End of Coverage Period Jane pays Her plan pays Jane pays Her plan pays Jane pays Her plan pays 100% 0% 20% 80% 0% 100% Jane hasnt reached her Jane reaches her $1,500 Jane reaches her $5,000 $1,500 deductible yet deductible, co-insurance begins out-of-pocket limit Jane has seen a doctor several times and Jane has seen a doctor often and paid Her plan doesnt pay any of the costs. paid $1,500 in total. Her plan pays some $5,000 in total. Her plan pays the full Office visit costs: $125 of the costs for her next visit. cost of her covered health care Jane pays: $125 services for the rest of the year. Office visit costs: $75 Her plan pays: $0 Jane pays: 20% of $75 = $15 Office visit costs: $200 Her plan pays: 80% of $75 = $60 Jane pays: $0 Her plan pays: $200
  20. 20. 20Evolving Healthcare Reform: 2014 Benefits• Limitation of waiting period 90 days, 2014• Reinsurance Contribution January 1, 2014 (from fully insured and self insured plans); State-based transition reinsurance program to help stabilize the premium coverage for the individual health insurance market during the first three years of operation of the Exchange- Additional Fee TBD• Quality Reporting requirements through improved health outcomes January 1, 2014 – Standardization Web Portals – Standardization of Benefit Plans – Standardization of Coordination of Benefits
  21. 21. 21Evolving Healthcare Reform: 2014 Benefits• >19 prohibition of pre-existing limitation• Expansion of Medicare and Medicaid, Offering subsidies to lower-income Americans, without coverage• Full Time/Part Time benefit coverage: definition of part time employee: 30/25/20 hours a week, seasonal labor >120 days/year• Healthcare Reform Employer Compliance Penalty Assessment 2014• Exchange Notice to employees establishing state health insurance exchanges – Exchanges will be certified for operations Jan 1, 2013. States may allow employers with more than 50/100 employees to purchase coverage in Exchange, 2014 – Large Employers, 2017
  22. 22. Status of State Legislation to Establish 22 WA Exchanges ME MT ND VT OR MN NH ID SD NY WI MA MI WY CT RI IA PA CA NV NE NJ OH MD IL IN DE UT WV CO KS MO VA KY NC TN AZ OK NM AR SC MS AL GA TX LA AK FL Legislation signed to establish exchange since PPACA Legislation failed Health exchanges established before PPACA Governor vetoed legislation Legislation signed intending to establish or study exchange No legislation HI Legislation passed by one or both houses Governor pursued nonlegislative options Legislation pending in one or both houses [includes District of Columbia]Source: Commonwealth Fund Analysis of National Conference of State Legislatures Data as of July 2011
  23. 23. 23 Evolving Healthcare Reform Repeal or Revise: 2014 Reform Laws• Non tax deductible penalties Pay or Play Mandate: $2,000 per full-time worker with 50 or more employees• Inadequate Coverage Free Voucher Program: – 100%-400% of Federal Poverty level and premium is more than 8.4%-9% of household income. Inadequate Coverage: Penalty $3,000 (# of employees receiving a premium tax credit or cost subsidy)• Offering Small Employer Tax Credits that provide coverage; Premium Tax Credit: – Small Business Health Options Program (SHOP); 50 or fewer employees with $50,000/$40,000 maximum average wage: Tax Credit for tax exempt employers maximum of 35%
  24. 24. 24Have a Great Day! Thank You for your Time and Attention