July 2008

Implementation of High Deductible Health Plans (HDHPs) in Your Practice

As the North Carolina Medical Society Employee Benefit Plan (the NCMS Plan) enters its eleventh year serving the physician practices of North Carolina, we are pleased to report that beginning August 1, 2008, we will offer 13 product choices to our participating practices. With seven PPO products, five High Deductible Health Plans (HDHPs), and one product blending an HDHP with a traditional PPO prescription drug copayment benefit, medical practices across the state have numerous options to choose from. All of our HDHP products are qualified to be paired with a Health Savings Account (HSA). Any health product offered by the NCMS Plan can be paired with a Health Reimbursement Account (HRA).

Simply stated, HRAs are funded by employers on a tax-deductible basis on behalf of their employees. A set amount of money is allocated for each employee for use in covering eligible medical expenses subject to their health plan's deductible or coinsurance. The money in an HRA is always owned by the employer. HSAs are another option for paying qualified medical expenses under an HDHP. These accounts can be funded by the employer and/or employee on a tax-deductible or pre-tax basis and are completely portable. Money deposited into an HSA by the employer or the employee is immediately owned by the employee.

Currently, 22% of medical practice employees covered by the NCMS Plan are enrolled in an HDHP. Some with a tax-advantaged health account (an HSA or HRA) and some without. While the traditional PPO plan still remains our most popular plan type, the decision to offer an HDHP is becoming more common, and the NCMS Plan makes it easy to add an HDHP as an option. In fact, NCMS Plan practices of up to 50 enrolled employees have the ability to offer any two plans to their employees. Groups of more than 50 enrolled employees can offer up to three plans.

As more groups offer HDHPs, the following suggestions may be helpful in facilitating a smooth transition for your practice.

• Groups that successfully implement HDHPs take the necessary time for communication and education of their employees. This can be done by holding an informational meeting prior to open enrollment meetings. The NCMS Plan staff or your Account Executive can be very helpful in this regard.
• Many practices continue to offer a PPO plan in conjunction with an HDHP. This is a popular solution resulting in physician and employee satisfaction.
• Many practices continue to pay 100% of the employee premium for the HDHP and offer a PPO as a buy-up option.
• With the implementation of an HSA or an HRA partially funded by the practice, employees will have assistance with reimbursement of eligible out-of-pocket medical expenses.

We are committed to assisting you with a high level of customer service. Please let us know if your practice would like further education regarding HDHPs, HRAs, or HSAs. We welcome your questions and look forward to serving you.

90-Day Rx Supply No Longer Requires 30-Day Supply First

Effective August 1, 2008, NCMS Plan members will no longer be required to first fill a 30-day prescription before a 90-day supply of the same prescription can be dispensed.

Prior to this change, the first time an NCMS Plan member filled a prescription, only a 30-day supply would be approved, even if a prescription for 90-days was presented at the pharmacy. The intent was to first establish a record of the maintenance drug, and then allow supplies of more than 30 days to be dispensed.

This change is likely to satisfy members prescribed a new maintenance drug who want a 90-day supply from the outset.

eBenefitsNow: Your Online Tool for Plan Administration

Do you have 16 or more employees enrolled on your NCMS Plan health plan? If so, you can use eBenefitsNow to take control of your benefits.

eBenefitsNow replaces the time-consuming paper-based benefit enrollment with a comprehensive online benefit administration and enrollment solution. It's secure, online, and paper free.

You can use eBenefitsNow to add new hires to your plan, make changes to employee benefit elections, and instantly send all of your changes directly to the NCMS Plan administrator, Blue Cross and Blue Shield of North Carolina. You also eliminate faxing errors and improve accuracy by transmitting information electronically. eBenefitsNow can even generate easy-to-use reports for your employee census and benefit detail.

To start implementation of eBenefitsNow, visit www.eBenefitsNow.com/serviceagreement.html and use access code: NC675899. Once you complete this agreement, a representative from BenefitFocus will contact you to get your group setup and to train you on how to use the system. There is no cost for your group to use eBenefitsNow.

Want to check out a demo? Visit www.eBenefitsNow.com/start.

Copy/Paste

Blue Points

Feel free to customize and share this article with your employees in your newsletter, on your intranet, by e-mail, or on a bulletin board.

Want a free MP3 player? How about a free soccer ball or radio for your son or daughter?

The North Carolina Medical Society Employee Benefit Plan has a physical activity and wellness incentive program called Blue Points that gives you and your covered dependents an easy way to record your physical activities and participation in wellness activities--and rewards you with great prizes!

Physical activity and lifestyle changes can greatly reduce the risk of cancer, heart disease, diabetes and other health conditions. With BluePoints, just 30 minutes a day of physical activity like working in the yard, playing golf, or walking the dog earns you points towards prizes like electronics, sports equipment, clothing and more! You can also earn points for enrolling in specific wellness programs and participating in wellness activities like learning more about healthy cholesterol and blood pressure levels.

All you have to do is record your activities online in your Blue Points Activity Log. To access your Activity Log, visit www.bcbsnc.com/memberservices/ and log in or register for Member Services. At least 30 minutes of activity a day or participation in a wellness activity earns you 10 points for that day. Earn 250 points and select a prize. And, there are special prizes for kids and teens.

For more information on online wellness activities that qualify for Blue Points, log in to Member Services and visit Health Programs. Sign up for the Get In Shape or Healthier Diet online wellness program or calculate your Body Mass Index (BMI).

Remember, it's a good idea to check with your doctor before starting any new activity. Ask your doctor to help you choose a fitness plan that's right for you and your family.

Ask George

Question: Some of my practice's employees have never had health insurance before and have recently become eligible for benefits. How can I best explain the difference between the deductible and coinsurance?

Answer: The deductible is the amount of allowable charges for covered services that must be paid by the employee before the NCMS Plan will assume any liability for the cost of any covered services. For example, the PPO 1500-80 plan has an individual in-network deductible of $1,500, so the employee would pay $1,500 for in-patient and out-patient services before the NCMS Plan would pay any portion of the remaining allowable charges.

Coinsurance is simply a type of "cost-sharing" that comes into play after the deductible has been met. Once the deductible is met, the employee pays a percentage of the cost of covered medical services as an out-of-pocket payment to the provider. Using the previous example, the PPO 1500-80 plan would have the NCMS Plan pay 80% of the cost and the employees pay the remaining 20% up to a given out-of-pocket maximum.

All NCMS Plan health products have an out-of-pocket maximum which upon being met, increases the plan benefits (the NCMS Plan's payment) to 100% (excluding copayments).

All NCMS Plan health products also have some deductible amount that must be met within a given benefit period. It's important to remember that the deductible does not include copayments, coinsurance, charges beyond the allowed amount, or amounts for non-covered services.

One last note, PPO and HDHP/HRA family deductibles work differently. PPO deductibles are individual; if one or more dependents are covered, each covered person has an individual deductible and a maximum combined family deductible (the individual deductible x 3). HDHP/HRA family deductibles are aggregate. The employee (or individual) deductible applies if employee selects "employee only" coverage; otherwise, the family deductible applies. All covered family members contribute to the same family deductible. Once the family deductible is reached, it is met for all covered family members.

George Fanelli is an Account Service Representative for the NCMS Plan. If you have a question you would like answered in a future issue of CHOICES, e-mail George at george.fanelli@mmicnc.com.

Practice Manager's Forum

High Deductible Health Plans and Provider Collection Policies

More than one-fifth of all employees covered by the NCMS Plan are now enrolled in a High Deductible Health Plan (HDHP). That's nearly 3,400 physicians and medical practice employees across the state. What's even more astounding is that the NCMS Plan has only been offering HDHPs since August 2006. And this growth is likely to continue, if not escalate. According to America's Health Insurance Plans, a Washington, D.C. trade group, 6.1 million Americans were covered by a HDHP as of January, up from 438,000 in 2004.

For those unfamiliar with HDHPs, one significant difference between a traditional PPO plan and a typical HDHP is that an HDHP does not have copayments. Employees on HDHPs pay the allowable charges for all services rendered in the provider's office. All of these payments go toward the employee's deductible.

So without copayments, employees (i.e. your patients) will ask, "What will I have to pay when I go to my doctor's office. I've always paid them my copayment and that was it". You or your practice's employees probably deal with this situation on a regular basis.

The NCMS Plan utilizes the Blue Cross and Blue Shield of North Carolina (BCBSNC) network of providers. The BCBSNC Provider Manual (The Blue Book) assists your practice with understanding and administering the health insurance products and billing guidelines. Section 3.11.2 of The Blue Book covers the specific issue: HDHP collection policy.

The Blue Book advises that the limitation on collection of estimated amounts are as follows:

• Physicians or professional providers may collect up to the lesser of the member's estimated out-of-pocket costs or $50 for services received in the provider's office.
• Hospitals and ancillary providers may collect up to the lesser of the member's out-of-pocket costs or $500 for services rendered in the hospital or outpatient facility.

The final determination of what the member owes is based on the claim that is submitted and will be reflected on the Explanation of Payment (EOP). Any refunds due to the member must be made within 45 days.

From the NCMS Plan's perspective, we want our (and your) covered employees' experience with a HDHP to be positive and easy, yet we understand that your practice has its own business interests to see after...a difficult balance. We advocate that practices (especially those with employees of their own on a HDHP) not collect anything at the point of service from HDHP members and allow claims to process and bill the member for allowable charges. Secondarily, we advocate that practices collect a standard copayment for the office visit (say $20 or $25 for a primary care visit, for example), or at least meet the guidelines referenced from The Blue Book.

The NCMS Plan acknowledges that medical practices have a difficult time these days on multiple fronts, but the growth of HDHPs and the number of NCMS Plan members enrolled in HDHPs from your practice, the practice across the street, or across town, may cause you to take another look at your collection policies.

To access BCBSNC's Provider Manual, The Blue Book, visit www.bcbsnc.com/providers/blue-book.cfm.

We'd be interested to know what you think about this topic. E-mail Gary Bossert at gary.bossert@mmicnc.com with your comments.

About the North Carolina Medical Society

As the largest physician organization in the state, the North Carolina Medical Society (NCMS) is devoted to representing the interests of physicians and protecting the quality of patient care. The NCMS Plan, sponsored by the NCMS, is the only statewide employee benefits plan designed specifically for North Carolina physicians.

For more information about many other benefits of NCMS membership, visit http://www.ncmedsoc.org/.