The Local Choice 2008-09 RoadShow

March 4-17, 2008

TLC Updates and Financials

Survivor Benefits

• Current – All Coverage Ends at End of Month in which Death Occurs.

• At 2008 Renewal - Annual Option – Family Coverage Will Continue to End of Month Following Month of Death.– Group Will Elect on Data Sheet Each Year– No Changes in Coverage Permitted– Full Premium Must Be Paid

Retiree Eligibility• Employer Must Offer Coverage

• Service Retirement– Minimum Age 50 with 10 Years of Service or Age 55

with 5 Years of Service– Annuity Requirement Removed

• Disability Retirement– Age and Service Requirement Waived with Disability

Certification by VRS, Other Disability Provider or Social Security Documentation

USERRA

• Applies to All Groups Regardless of Size

• Duration Extended from 18 to 24 Months

• Benefits Similar to Extended Coverage (COBRA) but Not Identical

• Sample USERRA Notice

• Provide COBRA Election Notice with USERRA Notice

Late Payments

• Defined and Mandated in Code of Virginia• Due on 1st of Month• Late After 10th of Month• 12% Annual Penalty for Late Payment• If Not Received by 20th of Month

– Suspend Claims Payment– Place Ad in Newspaper Informing Members

• Electronic Payment Available with Documentation Mailed to Lock Box

No Individual Checks

• Anthem Should Not Accept Individual Member Checks for COBRA or Retiree Coverage

• We Allow Groups a 45 Day Grace Period for those Benefits

• Please, No More than One Check Per Sub-Group

Rate Equalization Process

• 2006-07 and 2007-08 Very Good Loss Ratio Years

• Rewarded Groups who Contributed to TLC Surplus with up to 6% Rate Reduction

• Returned $5,500,000 through Rate Reduction with this Renewal

• Average 2008-09 Rate Adjustment (1.8%)

Qualifying Mid-Year Events

Qualifying Mid-Year Events (QMEs)

• TLC Assumes All Groups Have Cafeteria Plans.• Cafeteria Rules Require that Once an Election Is

Made, It Is Irrevocable until the Next Open Enrollment or with a QME.

• Changes Must Be Consistent with and On Account of the QME.

• QME Guidelines Are Based on TLC Business Rules. Your 125 Rules May Take Precedent.

• A Signed and Completed Enrollment Form Requesting Change Must Be Received by your Office Within 31 Days of the QME.

Effective Dates

• All changes must be made on a prospective basis except in the case of birth, adoption or placement for adoption. This means changes will be effective the first of the month following submission of the Enrollment Form, if the form is submitted within 31-days of the event. Changes for the birth, adoption, or placement for adoption of a child will continue to be made on the first day of the month in which the birth, adoption or placement for adoption occurs, so long as notification occurs within 31-days of the event.

Birth, Adoption or Placement for Adoption

Permitted Changes: • You May Enroll or Change your Plan. HMO Members

Are Required to Select a Primary Care Physician (PCP).• You May Add Eligible Family Members.• Employees Must Contact their Group Benefits

Administrator about Removing Family Members or Waiving Coverage if Enrolling Under your Spouse’s Plan.

• Note: Exception for those Already Under Family Coverage.

Child Covered Under Your Plan Loses Eligibility

Permitted Changes: • You may change your plan. HMO members are required to select a PCP.• You must remove the child who loses eligibility. This usually happens when

a child marries, no longer lives at home or away at school, or receives less than one-half of their support from you. It also applies to a step-child who no longer lives with you. The removed child will receive a HIPAA Certificate and an Extended Coverage Election Notice (COBRA), if applicable to your group.

• Warning! There are serious consequences for not removing a family member who is no longer eligible. You may be financially responsible for their claims, you may overpay premiums that cannot be refunded, and you may be excluded from health care coverage for up to 3 years.

• Note: A covered child is automatically removed at the end of the year in which they turn Age 23, however you must request a premium adjustment, if appropriate.

• Special rules apply for a child age 23 or older with a qualifying disability.

Death of Child

Permitted Changes: • You May Change your Plan. HMO

Members Are Required to Select a PCP.

• You May Remove Only the Deceased Child.

Death of Spouse

Permitted Changes:• You May Enroll or Change your Plan.

HMO Members Are Required to Select a PCP.

• You May Add Eligible Family Members who Lost their Coverage Due to the Death of your Spouse.

• You May Remove Only your Deceased Spouse.

DivorcePermitted Changes:• You may enroll or change your plan when coverage is lost under your

former spouse’s plan. HMO members are required to select a PCP.• Note: Contact your agency’s Benefits Administrator about adding

eligible family members.• You must remove the former spouse. A former spouse is not eligible

under your plan even when there is a decree ordering you to provide health care coverage. The former spouse will receive a HIPAA Certificate of Group Health Care Coverage and an Extended Coverage Election Notice (COBRA), if applicable to your group.

• Warning! There are serious consequences for not removing a family member who is no longer eligible. You may be financially responsible fortheir claims, you may overpay premiums that cannot be refunded, andyou may be excluded from health care coverage for up to three years.

Gains Eligibility under Medicare or Medicaid

These QME Election Changes Are Permitted when You, your Spouse, or your Child Enrolls Under Medicare or Medicaid (Other than Coverage Solely for Pediatric Vaccines).

• Permitted Changes:• You May Change your Plan. HMO Members Are

Required to Select a PCP.• You May Remove Family Members Enrolling in

Medicare or Medicaid. Removed Family Members Will Receive a HIPAA Certificate. They Do Not Qualify for Extended Coverage (COBRA).

HIPAA Special Enrollment

These QME Election Changes Are Permitted when You, your Spouse, or your Child Loses Other Group Health Care Coverage. The Other Coverage May Be Exhausted COBRA Coverage, or Non-COBRA Coverage where You Are (a) No Longer Eligible or (b) the Employer’s Contribution Toward the Premium Ceases.

Permitted Changes:• You May Enroll or Change your Plan. HMO

Members Are Required to Select a PCP.• You May Add Eligible Family Members.

Initial Enrollment Period

• The Initial Enrollment Period for health care coverage occurswhen you begin employment with the Local Employer (including

being re-hired more than 30 days after termination from previous employment) or become newly-eligible for coverage. Your coverage is automatically waived until your enrollment request is approved. If you are rehired less than 30 days after prior termination and you continue your previous elections.

• You may enroll in the plan of your choice. HMO members are required to select a PCP.

• You may add eligible family members.• Warning! There are serious consequences for adding ineligible

family members. You may be financially responsible for their claims, you may overpay premiums that cannot be refunded, and you may be excluded from health care coverage for up to 3 years.

Judgment, Decree, or Order to Add Child

These QME election changes are permitted when you are directed by judgment, decree, or order to provide coverage for a child not currently covered under your plan. This may have resulted from a divorce, a change in legal custody, a National Medical Support Notice from the Department of Social Services, or any other Qualified Medical Child Support Order.

Permitted Changes:• You may change your plan. If you are not already enrolled, you

must enroll. HMO members are required to select a PCP.• You must add the eligible child named in the notice. (You may add

only eligible dependent children.)• Note: If your employer is served with the notice, you must make the

change to the health coverage.

Judgment, Decree, or Order to Remove Child

These QME election changes are permitted when your spouse, former spouse, or other individual is directed by judgment, decree, or order to provide coverage for a child currently covered under your plan. This may have resulted from a divorce, a change in legal custody, a National Medical Support Notice from the Department of Social Services, or any other Qualified Medical Child Support Order.

Permitted Changes:• You may change your plan. HMO members are required to select a

PCP.• You may remove only the child named in the notice. The removed

child will receive a HIPAA Certificate. The child does not qualify for Extended Coverage (COBRA).

• You may waive coverage.

Lost Eligibility under Governmental Plan

These QME election changes are permitted when you, your spouse, or your child loses coverage under a group health care plan sponsored by a governmental institution. These include State-sponsored plans for children (including FAMIS), plans offered by Indian Tribunal governments, and national plans offered by foreign governments.

Permitted Changes:• You may enroll or change your plan. HMO

members are required to select a PCP.• You may add eligible family members.

Lost Eligibility under Medicare or Medicaid

These QME Event Election Changes Are Permitted when You, your Spouse, or your Child Loses Eligibility Under Medicare or Medicaid.

Permitted Changes:• You May Enroll or Change your Plan.

HMO Members Are Required to Select a PCP.

• You May Add Eligible Family Members.

Marriage

Changes Permitted:• You May Enroll or Change your Plan.

HMO Members Are Required to Select a PCP.

• You May Add your Spouse and Eligible Family Members.

• Note: Don’t Forget to Remove Family Members or Waive Coverage if Enrolled Under your Spouse’s Plan.

Move Affecting Eligibility for Health Care Plan

These QME election changes are permitted when you, your spouse or your child’s eligibility for a health care plan’s service area changes. This usually happens when there is a permanent change of residence, but may also happen when there is a change in your work location. It applies primarily to HMO coverage.

Changes Permitted:• When you gain eligibility for HMO coverage, you may

enroll or change your plan to the HMO.• You may add eligible family members when they move

into your HMO’s service area.• When you lose eligibility for HMO coverage, you must

change your plan or waive coverage.

Open Enrollment PeriodThis is your annual opportunity to review your options and enroll or

make election changes.

Actions Permitted:• You may enroll or change your plan. HMO members are required to

select a PCP.• You may add eligible family members.• You may remove family members. Removed family members will

receive a HIPAA Certificate. They do not qualify for Extended Coverage (COBRA).

• You may waive coverage.

• Warning! There are serious consequences for adding ineligible family members. You may be financially responsible for their claims, you may overpay premiums that cannot be refunded, and you may be excluded from health care coverage for up to three years.

You begin or end Full-time employment

Permitted Changes:

Changes Must Be Consistent with the Employment Change Event and Can Include Cost and Coverage Changes.

• Change in Employee’s Employment Status• Begins/Ends Full-Time Employment• Begins/Ends Leave Without Pay• Begins/Ends Family Medical Leave• Begins Retirement

Other Employer’s Open Enrollment or Health Care Plan

Change

These QME election changes are permitted when the coverage for you, your spouse, or your child under an employer’s health care plan is changed and a corresponding change on your plan is desired.

Permitted Changes:• You may enroll or change your plan when a change is made

under the other plan. HMO members are required to select a PCP.• You may add eligible family members who are removed from the other plan.• You may remove family members who enroll in the other plan. Removed

family members will receive a HIPAA Certificate. They do not qualify for Extended Coverage (COBRA).

• You may waive coverage if enrolled under the other plan.

Spouse or Child Gains Eligibility Under Their Employer’s Plan

• You may change your plan. HMO members are required to select a PCP.

• You may remove family members who enroll in the other plan. Removed family members will receive a HIPAA Certificate. They do not qualify for Extended Coverage (COBRA).

• You may waive coverage if enrolled in the other plan.• If your child is the one with the employment status

change, be sure to review “Child Covered Under Your Plan Loses Eligibility”.

Spouse or Child Lost Eligibility under Their Employer’s Plan

• You May Enroll or Change your Plan. HMO Members Are Required to Select a PCP.

• You May Add Eligible Family Members.

Documentation

• With Exception of Court Orders to Add or Drop Dependent Children and Adoption Agreements, TLC Typically Does Not Ask for Documentation of QMEs.

• We Strongly Recommend that You Obtain Documentation for your Records Since Any Audit by IRS Will Be On your Records, Not TLC's.

• We Reserve the Right to Audit for Eligibility.

Medicare

Activesvs.

Retirees

Incorrect Plan Placement

• #1 Problem in all TLC• Key Advantage, HDHP and Kaiser Plans

Are Not Available for Medicare Eligible Retirees or their Medicare Eligible Dependents

• Advantage 65, Advantage 65 w/DV and Medicare Complementary Are Not Available to Active Employees or their Dependents

Importance

• Avoid Medicare Demand Letters and Treasury Offsets

• Prevent Retro-Active Movement to Correct Plan• Prevent Medicare Penalties or Delayed Entry• Avoid Claim Retractions which Require Member

Payment of Undiscounted Claims and Billing for Rx Claims

• Medicare Claims Are Pooled; Active and Early Retiree Claims Are Charged Against Experience

• Reduce TLC Costs for Specialized Assistance and Keep Your Cost Down

Communications

• Emphasized in Every TLC Regional Meeting for Past 3 Years

• e-News Article

• New - Reminder Letters to Employees and GBAs

• Inserts

On Cover of Every Insert

Coverage under The Local Choice Key Advantage With Expanded Benefits (200, 300, 500,and HDHP) contract is for:

Active Employees and their Dependents

Retirees not eligible for Medicare and their Dependents not eligible for Medicare, and/or

Dependents of Medicare eligible Retirees who are not Medicare eligible.

Note: Medicare eligible retirees and the Medicare eligible dependents of anyretiree, Medicare eligible or otherwise, may not enroll in Key Advantage With Expanded Benefits. If your Local Employer offers a TLC Medicare supplemental plan, be aware that participation in both Parts A and B of Medicare is required to receive maximum benefits under the Medicare supplemental plan.

?? Questions ??

The Local ChoiceWalter E. Norman, Program Manager

101 N. 14th St., 13th Floor

Richmond, VA 23219

walter.norman@dhrm.virginia.govPhone (804) 786-6460 Fax (804) 371-0231

www.thelocalchoice.virginia.gov