2012 Employee Benefits Meeting Presented to: Presented by: Mardi - PowerPoint PPT Presentation

2012 Employee Benefits Meeting Presented to: Presented by: Mardi Burns, CHC Senior Vice President, Senior Benefits Consultant Lana Hitner, HIA Account Executive associatedfinancialgroup .com

Housekeeping Items • Please make sure you have the Anthem brochure • Please hold questions until the end of the presentation • If you have a personal question, you may talk with someone one on one after the presentation 2 associatedfinancialgroup .com Sheboygan Area School District/12/Ren/SASD Employee Renewal Meetings.ppt

Today’s Agenda • Short Term Disability • Long Term Disability • Health Care Reform Overview • Review Changes with the Health Plan • Introduction of Independent Clinic 3 associatedfinancialgroup .com Sheboygan Area School District/12/Ren/SASD Employee Renewal Meetings.ppt

Sheboygan Area School District Long and Short Term Disability (LTD & STD) Corporate Office: 250 South Executive Drive, Suite 300 Brookfield, WI 53005 800.627.3660 www.NISBenefits.com 4

National Insurance Services (NIS) • Working with state’s schools, cities and counties since 1969 • Corporate headquarters is in WI • Currently insures 1,566 public sector groups in 20 states • NIS does business with approximately 45% of school districts in the state • Endorsed by CESA 7 5

Short Term Disability Benefits (STD) • Active employees only • Employee paid • Match in current benefits • Benefits begin 1 st day of Accident and 4 th day of Sickness • Maximum Benefit Duration is 90 consecutive calendar days • Can collect short term disability benefit PLUS sick leave or workers’ compensation • Benefits are paid over the summer months • Maternity is covered • 12/12 pre-ex applies 6

Short Term Disability Benefits (STD) • Benefit is not taxable (as long as NOT put through flex plan) • Benefit is designed to dovetail with the LTD • If you are currently enrolled, you will be enrolled at the same benefit level. No additional paperwork needed. • Pick up an enrollment packet after the presentation if you are interested in enrolling in STD • One time open enrollment now through May 31 st • Return forms to Payroll by May 31 st 7

Long Term Disability (LTD) • Active employees only • SASD pays for this benefit • Benefit covers up to 66 2/3% of your salary • Maximum monthly benefit is $8,000 • 90 consecutive calendar day elimination period • Mental Illness/Substance Abuse covered same as any illness • Enhanced Definition of Disability  No gap in coverage (LTD plan will continue LTD coverage until claimant is eligible for Social Security Disability (SSDI))  After claimant is eligible for SSDI, the LTD plan will coordinate benefits  Current plan provides coverage for up to 24 months in order to continue long term disability 8

Health Care Reform – What is it? Patient Protection and Affordable Care Act  Signed into law on March 23, 2010  Commonly referred to as the Health Care Reform bill  Regulations in the bill started to take effect at the beginning of the first plan year after September 23, 2010 Goals:  Improve access  Stabilize cost  Reform insurance products Core Component = Mandated Coverage 9 associatedfinancialgroup .com Sheboygan Area School District/12/Ren/SASD Employee Renewal Meetings.ppt

Health Care Reform Impact • Cost shifting to private payors due to less reimbursement from government programs • Insurance exchanges • Magnet plan risk • Cadillac tax in 2018 – Estimated $1.6 million 10 associatedfinancialgroup .com Sheboygan Area School District/12/Ren/SASD Employee Renewal Meetings.ppt

Health Care Reform Upcoming changes for January 1, 2013 – Health Care Flexible Spending Account (FSA) limit reduced to $2,500 – Health care premiums to be reported on employee’s W-2 (2012 data) – Fees (transitional fee, comparative effectiveness research fee) 11 associatedfinancialgroup .com Sheboygan Area School District/12/Ren/SASD Employee Renewal Meetings.ppt

Why are Health Care Costs Rising? • Aging population • Technological advancements • Direct advertisement from pharmaceutical companies to consumers • Over-use, under-use and misuse of healthcare resources • Personal desires and wants driving services without knowledge of the costs 12 associatedfinancialgroup .com Sheboygan Area School District/12/Ren/SASD Employee Renewal Meetings.ppt

SASD Health Plan Facts • Medical costs are currently over 20 million annually • Pharmacy costs are currently over four million annually • 42% of plan members incurred $1,000 or less in charges • 15% of plan members accounted for 75% of all plan costs • At a trend of 8%, costs are expected to reach 35 million by 2018 13 associatedfinancialgroup .com Sheboygan Area School District/12/Ren/SASD Employee Renewal Meetings.ppt

SASD Cost Containment • Disease management programs • Provider network – Access – Discounts • Anthem online tools – Care Compare • Preventive care • Wellness • Plan design changes • Pharmacy cost containment programs • Independent Clinic 14 associatedfinancialgroup .com Sheboygan Area School District/12/Ren/SASD Employee Renewal Meetings.ppt

Health Plan Changes Effective July 1, 2012 Applies to all employees except Hearing Interpreters 15 associatedfinancialgroup .com Sheboygan Area School District/12/Ren/SASD Employee Renewal Meetings.ppt

Deductible Network Non-Network Deductible Effective Effective Tier Current Current 7/1/12 7/1/12 Single $200 $500 $200 $1,000 Employee plus Spouse $400 $1,000 $400 $2,000 OR Child(ren) Family $400 $1,000 $400 $2,000  Network and non-network deductibles cross reduce.  This means any network deductible satisfied will also apply to the non- network deductible and non-network deductible will satisfy the network deductible until each limit is reached.  Deductibles currently met will be credited to the new deductible.  Deductibles will start over January 1, 2013. 16 associatedfinancialgroup .com Sheboygan Area School District/12/Ren/SASD Employee Renewal Meetings.ppt

Coinsurance Coinsurance Network Non-Network Effective Effective Tier Current Current 7/1/12 7/1/12 Single N/A $500 $400 $1,000 Employee plus Spouse N/A $1,000 $1,000 $2,000 OR Child(ren) Family N/A $1,000 $1,000 $2,000  Network – Plan pays 90%; Employee pays 10%  Non-Network – Plan pays 70%; Employee pays 30%  Network and non-network coinsurance cross reduce.  Coinsurance means the insured person and the insurer share a set percentage of the hospital and medical expenses after the deductible has been met. 17 associatedfinancialgroup .com Sheboygan Area School District/12/Ren/SASD Employee Renewal Meetings.ppt

Coinsurance Example Assumes a Network provider is utilized. Allowable Charges $5,500 Subtract Member Deductible - 500 Remaining Balance $5,000 Subtract 10% Member Coinsurance - 500 Health Plan Pays $4,500  It will take $5,500 of allowable charges to satisfy the deductible and coinsurance for one person. 18 associatedfinancialgroup .com Sheboygan Area School District/12/Ren/SASD Employee Renewal Meetings.ppt

Maximum Out-of-Pocket Network Non-Network Maximum Out-of-Pocket Effective Effective Tier Current Current 7/1/12 7/1/12 Single N/A $1,000 $400 $2,000 Employee plus Spouse N/A $2,000 $1,000 $4,000 OR Child(ren) Family N/A $2,000 $1,000 $4,000  Maximum out-of-pocket also referred to a out-of-pocket maximum is the total amount of deductible and coinsurance the covered person will pay.  Accumulates on an single and family level. The family out-of-pocket maximum is the combined total for all family members.  Emergency room copays and pharmacy copays and coinsurance do not apply toward the out-of-pocket maximum. 19 associatedfinancialgroup .com Sheboygan Area School District/12/Ren/SASD Employee Renewal Meetings.ppt

Emergency Room • $100 copay(waived if admitted); then deductible and coinsurance • Benefit is the same whether you see an Network or Non-Network provider 20 associatedfinancialgroup .com Sheboygan Area School District/12/Ren/SASD Employee Renewal Meetings.ppt

Prescription Drugs • Implementing a formulary • Four tier levels – Tier 1 – Generic - $10 copay – Tier 2 – Preferred Brand - $25 copay – Tier 3 – Non-Preferred Brand - $50 copay – Tier 4 – Specialty - 25% up to $150 per month one month supply 21 associatedfinancialgroup .com Sheboygan Area School District/12/Ren/SASD Employee Renewal Meetings.ppt

What is a Formulary? • List of prescription drugs approved for the use and/or coverage by a benefit plan • What do the tiers represent? – Determined by several factors • Cost of drug • Cost of drug in comparison to other drugs used for the same treatment • Availability of over the counter options • Other clinical and cost factors 22 associatedfinancialgroup .com Sheboygan Area School District/12/Ren/SASD Employee Renewal Meetings.ppt