State Employee Health Plan

1. State Employee Health Plan Open Enrollment 2011

2. State of the Plan • Claim expense continues to outpace revenue • Plan reserves are low • Bill passed requiring claim audits • Audits to recover claims paid in error • $9 million removed from health care fund 7/1/10 • Health Care Commission voted to: • Increase employee and employer rates • Agencies will see a 15% increase • Employee rates increase up to 8% • Plan design changes for Plan A & B

3. Medical Plan Changes for 2011 • Plan A • Network Deductible increased to $300/$600 • Network Coinsurance maximum increased $1,400/$2,800 • Office visit Copays • Primary Care Provider $25 • Specialist $45 • Plan B • Network Deductible added $150/$300 • Network Coinsurance increased 5% to 35% • Network Coinsurance maximum increased to $3000/$6000 • No changes for Plan C

4. Legislative Changes • Senate Subs. For House Bill 2160 Requires a one-year pilot to provide coverage for: • Autism spectrum disorder • Birth to 7 years - not to exceed $36,000 • Age 7 to 19 - not to exceed $27,000 • Covered services subject to applicable deductible, coinsurance and copays • Services must be medically necessary • Report due to the legislature March 2012 • Oral cancer medications • Requires coverage of oral drugs in the same manner as IV cancer medications.

5. Patient Protection & Affordable Care Act • Signed into law on March 23, 2010 • Incorporates modifications of the Health Care and Education Reconciliation Act of 2010 • Signed into law on March 30, 2010 • Jointly referred to as Health Reform • Complex law • Implementation is in phases

6. Key Provisions for 2010 • Mandates coverage for children to age 26 • No school or support requirements • Can be married – (no coverage for spouses) • Requirement effective for SEHP on 1/1/11 • Enroll your dependents during Open Enrollment • Prohibits lifetime maximums on “essential services” for medical plans

7. Key Provisions for 2010 • Authorizes the FDA to approve generic versions of biologic drugs • 12-year exclusivity period on biologic drugs • Provides temporary reinsurance program for early non Medicare retirees (age 55-65) • Limited to $5 billion dollars • Reimburses the health plan for amount spent on high cost claims of early retirees • Temporary expires in 2014 • SEHP has applied for the program • Requires coverage without cost sharing for preventive services

8. Covered Preventive Care

9. Key Provisions for 2011 • Excludes over the counter (OTC) products without a prescription as eligible expenses: • Health Care Flexible Spending Account (FSA) • Plan C - Health Savings Account (HSA) • Increases the taxes on HSA funds not used for medical purposes • Employers required to disclose value of health benefits on W-2 form

10. 2011 SEHP Medical Plans • Standardized Plan designs: • All plans include preventive care • All plans are Preferred Provider Organizations (PPO) • Claims paid based on the network status • Network providers accept the plan allowance as payment in full • Non Network Providers can balance bill

11. Vendor Options

13. Selecting a Medical Plan • Pick a plan design (Plan A, B or C) • Which plan design provides the coverage you and your family need? • Review the Provider Networks • Each of the medical plans uses a different provider network • Not all providers are in the network • Review the other services each medical plan offers • Websites, discount programs, etc. 4. Review the premiums

14. Plan A – Network Providers • Preventive Care Covered at 100% • Office Visit Copays • $25 for Primary Care Office Visits • $45 for Specialist Office Visits • $300/$600 Deductible • 20% Coinsurance • Coinsurance Max $1,400/$2,800 • Quest Lab Card Benefit

15. Plan B – Network Providers • Preventive Care Covered at 100% • Primary Care Office Visits • $20 Adult Copay • $10 Children age 18 and under Copay • Specialist Office Visits • $40 Adult Copay • $25Children age 18 and under Copay • $150/$300 Deductible • 35% Coinsurance • Coinsurance maximum $3,000/$6,000 • Quest Lab Card benefit

16. Plans A & B Non Network Providers • $500/$1,500 Deductible • 50% Coinsurance • Coinsurance Max $3,650/$7,300 • Preventive care not covered

17. Quest Lab Card • Optional Lab Card Program • Benefits: • 100% coverage of eligible outpatient lab tests • Saves you and the plan money • For non-emergency outpatient lab work only • Testing must be performed and billed by Quest • You will need to request to use Quest Or • Visit a Quest collection site • The decision is up to you and your provider • You have a Quest ID card • Your medical card ID also works

18. Quest Lab Card Savings Charges on a typical lab claim for: CBC, Lipid Panel, TSH & Basic Metabolic Panel Plan saves $89.36 and Employee saves $31.17 Source: Quest Diagnostics, Inc. Current Lab Fees Billed $194.83 Allowed: $155.86 Coinsurance 80% Plan pays $124.69 Member pays $31.17 Lab Card Fees Total Charges $35.33 Allowed: $35.33 Coinsurance 100% Plan pays $35.33 Member pays $0

19. True or False • My doctor’s office said I had to use Quest for lab services or I would have no lab coverage. False. Quest is an optional program. You are not required to use it and you do have coverage at other labs. • My provider said that I had to transport my pap smear specimen to a Quest site to have coverage. False. Preventive care services such as a pap smears are covered at 100% when provided by a network provider. Quest is one of the network providers.

20. Plan A & B Drug Benefit Generic Drugs • 20% Coinsurance Preferred Brand • 35% Coinsurance Special Case Medications • $75 per 30-day Supply Non Preferred Brand • 60% Coinsurance Discount Tier • 100% Member Responsibility More information: www2.caremark.com/kse

21. Generic Launches 2010 • Flomax • Cardizem La • Skelaxin • Cozaar • Hyzaar • Yaz • Arimidex • Effexor XR • Amerge • nn • 2011 • Aricept 2nd Qtr • Levaquin 2nd Qtr • Nasacort AQ 2nd Qtr • Serevent Diskus 3rd Qtr • Tegretol XR 3rd Qtr • Xeloda 3rd Qtr • Femara 4th Qtr • Lipitor 4th Qtr • Zyprexa 4th Qtr

22. Plan C – QHDHP w/ HSA • Network Provider Coverage • $1,500/$3,000 Deductible • 20% Coinsurance • $3,000/$6,000 Out-of-Pocket Maximum • Preventive Care Services paid at 100% • Non Network Provider Coverage • $2,000/$4,000 Deductible • 50% Coinsurance • $3,650/$7,300 Out-of-Pocket Maximum • Preventive Care is not covered

23. Plan C – QHDHP Drug Plan • Drugs are subject to the Deductible then: • Generic $10 Copayment • Preferred Brand $30 Copayment • Non Preferred Brand $55 Copayment • Copayment is per 31-day supply • Generic Incentive Provision • Uses Caremark Preferred Drug List • Not “creditable” drug coverage for Medicare

24. Dental Coverage • Plan pays in full for two cleanings and oral exams each year for each member • Plan Deductible • Applies to Basic & Major Restorative Care • $50 per person, maximum of 3 per family • Orthodontic benefit • $1,000 per person per lifetime • Annual benefit maximum • $1,700 per person per year

25. Basic Benefit • If you have NOT had a preventive exam or office visit for exam or cleaning of the teeth in the preceding 12-month period:

26. Enhanced Benefits • If you have had at least one preventive or office visit for cleaning or exam of the teeth in the preceding 12-month period:

27. Vision Plan • Basic Plan • Eye exams subject to $50 Copay • $25 Materials Copay then: • 100% single-vision, standard bifocal, trifocal lenticular lenses • Up to $100 allowance for frames • Elective Contact lens allowance $150 • Enhanced Vision Plan includes Basic PLUS… • Progressive lenses up to $165 • High index lenses or Poly-carbonate lenses up to $116 • Scratch and UV coating • Contact Lens Fitting Fee - subject to $35 Copay

28. Flexible Spending Accounts • Health Care Flexible Spending Account • Deductibles, Copays & Coinsurance • Eyeglasses, contacts, orthodontics & hearing aids • Optional Debit Card for health care FSA • Dependent Care Flexible Spending Account • Day care services & Pre-school or Babysitters • Pre-tax contributions • Up to $5,000 per account per year • Extended grace period for Health Care FSA • Details on eligible expenses available at: www.asiflex.com

29. Optional HCFSA Debit Card • Optional Debit Card for health care FSA • Information will be sent to you to elect debit card • You pay a $12 service fee per year • Non refundable fee is charged at the beginning of the year • Debit cards roll from year to year • Current debit card users must contact ASI to cancel debit card enrollment • Must notify ASI no later than December 15, 2010 to avoid the $12 fee for 2011

30. Over the Counter Drugs • Effective January 1, 2011, over the counter drugs will require a physician prescription to be eligible under an HFSA. • Change due to the Patient Protection and Affordable Care Act • For a list of OTC drugs that require a prescription go to:www.asiflex.com • Debit card may not be used for OTC drugs after 1/1/11

31. Limited FSA for Plan C • New limited FSA available for members on Plan C. • Can set aside funds for dental and vision expenses only • Cannot be used to fund medical expenses • HSA account is designed for that purpose • Debit card not available for use with this account • Contribution limit same as Health Care FSA • “Use it or lose it” applies to this account as well

32. HealthQuest • Health Screenings & Online Health Assessment • $50 gift card for completion • 24/7 Nurse Line • Lifestyle Health Coaching • Condition Management Programs • Tobacco Cessation Program • Employee Assistance Program (EAP) • 24/7 confidential support • Personal counseling & referrals • HealthQuest Website, Portal, Newsletter & Blog • Wellness Presentations • Wellness Champion Network http://www.sehbp.org/healthquest

33. Non Tobacco Users Discount • You must disclose your tobacco status • Discount available for: • Non tobacco user - or - • Tobacco users agreeing to enroll and complete the HealthQuest tobacco cessation program • You may begin the tobacco cessation program now! • You must complete 5 tobacco discussions by May 1, 2011 • Discount is based oncompletingthe program

34. Paying the Base Rate in 2011 • The following will NOT be receiving the discount: • Elects not to disclose Tobacco status • Tobacco users not enrolled in the tobacco cessation program • Failed to enroll online and disclose tobacco status • Members who enroll but fail to complete the tobacco cessation program by May 1, 2011 will lose their discount for the remainder of 2011.

35. Annual Open Enrollment • October 1 – October 31, 2010 • Enroll online: • Declare tobacco status (Annual enrollment required) • Make health plan selections • Add/drop dependents • Enroll in Flexible Spending Accounts • Enroll in HealthyKIDS • Families at 250% of poverty level • State pays 90% of children’s premium • Same coverage Must enroll every year • Coverage effective January 1, 2011

36. Dependent Eligibility Change • Effective 1/1/11, dependents are eligible to be covered on the plan to age 26 even if: • they do not live with you • they are not a student • they are not dependent on you for support, or • are married • Spouses of dependents are not eligible • Grandchildren are only eligible under limited circumstances. • You can add coverage for your eligible dependents during this open enrollment

37. Required Documentation • If you are adding a dependent, documentation of eligibility is required • Birth certificates • Marriage licenses • Affidavit of common law marriage • Social Security numbers required • Document due by 11/1/10 • If documentation is not received, dependents will not be added to your plan for 2011

38. Identification Cards • To receive a new ID card, your address in SHARP must be accurate. • Last year we received over 15 tubs of returned mail due to incorrect member addresses • ID cards delayed due to manual look-up required • Plan A members will be getting new health plan ID cards • Dental and Vision members will get new cards • If you need a new ID card, call the vendor

39. Resources • Review the Open Enrollment (OE) booklet • ?’s call the health plan customer service • Phone numbers in the front of the OE booklet • Visit the KHPA website: www.sehbp.org • Benefit descriptions available • Provider directory listings • Preferred drug list • Information on the HSA and FSA accounts • Email ?’s to SEHP: benefits@khpa.ks.gov

40. Open Enrollment Checklist • Enrollment Online: • Consider enrolling your dependent children under age 26 • Review health plan selections • Must declare tobacco status • Enroll in HealthyKIDS • Enroll in flexible spending accounts • Confirmation statements • Available online 12/15/10

41. Questions?

42. Option Slides

43. Network vs. Non Network

44. Primary Care Providers (PCPs) • General practice • Family practice • Geriatrics • Internal medicine • Physician extenders • Pediatrics • PCPs have lower office visit copays • Plans A & B only • Member may have more than one PCP • No referrals required

45. Dental Preventive Care • Covered in full: • Prophylaxis/cleanings – twice per year. • Oral examinations – twice per year. • Bitewing x-rays – • adults - 1x a year • children under 18 - 2 x a year • Full mouth x-rays – once each five (5) years. • Limited coverage for children only: • Sealants • Space maintainers • Topical fluoride • Ancillary – emergency relief of pain.

46. Dental Restorative Services • Basic Restorative • Regular restorative dentistry – fillings • Oral surgery • Endodontics – root canals • Periodontics – treatment of gum & bone disease • Additional Diagnostic X-Rays • Major Restorative • Special restorative dentistry – crowns • Prosthodontics – bridges, implants, dentures • TMJ Treatment – Requires prior authorization Restorative care is subject to a $50 deductible

47. Claiming Your Flex Funds • Optional Debit Card for health care FSA • Information will be sent to you to elect debit card • You pay a $12 service fee per year • Fee is charged at the beginning of the year • You may still need to send documentation to ASI • Reimbursements by check or direct deposit available • Fill out a claim form, attach receipts, and mail or fax to ASI. • Fill out form electronically, attach electronic copies of receipts, and email to: claims@asiflex.com