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KCTCS 2009 Employee Open Enrollment

KCTCS 2009 Employee Open Enrollment. October 13 th – 24 th , 2008. Health Insurance Highlights. Mandatory Enrollment – No Exceptions IDS and Passwords were mailed to employees at their home address The New Benefits Selections Guides will be provided to employees

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KCTCS 2009 Employee Open Enrollment

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  1. KCTCS2009 Employee Open Enrollment October 13th – 24th, 2008

  2. Health Insurance Highlights • Mandatory Enrollment – No Exceptions • IDS and Passwords were mailed to employees at their home address • The New Benefits Selections Guides will be provided to employees • The larger KEHP Handbook is available on the DEI web-site http://www.personnel.ky.gov/dei/09OE/ • Benefits Selection Guides will include a paper application for active employees

  3. New for 2009 • Mandatory, Active Enrollment • Web Enrollment or paper application • Default to waiver with no HRA money if employees do not enroll • Premium Holiday December 2008 • No health insurance premiums deducted for December • Pre-Pay to current pay effective January 1, 2009 • Virgin HealthMiles • Internet based activity program • Earn cash and gift cards by earning “HealthMiles” • Will not be implemented until after January 1st for KCTCS. A separate roll-out will occur

  4. New for 2009 • Carena In-home Urgent Care • Carena’s modern-day, physician house-call service • Greater Louisville area & Franklin County • Option for non-emergency conditions • Call HumanFirst Nurse Advice Line • 24 hour toll free number (800) 622-9529

  5. New for 2009 • Coverage for Dependents to Age 25 • Smoking Status change outside Open Enrollment may be requested with proper documentation. Change will be limited to the smoker contributions and will not allow other changes to plan. • Single plans pay 1 times the smoker amount. Parent Plus plans by 2 times the smoker amount. Family and family cross-reference will pay 2 times the smoker amount (1/2 from each employee on x-ref). • Qualifying events that require an employee to sign and date their form or application within 30 days of the event will now change to 35 days beginning January 1, 2009.

  6. New for 2009 • A family cross-reference plan will automatically drop to a parent plus if one spouse terms employment. The termed spouse may be added back on as a qualifying event if add form is signed and dated within 35 days of the qualifying event.

  7. New for 2009 Due to the change to Current Deductions: • Terminations of plans will end on the 15th of the month if an employee loses employment between the 1st and the 15th of the month. • Terminations of plans will end on the last day of the month if the employee loses employment between the 16th and the last day of the month. • Returning from LWOP will follow the same rule as above in that the reinstatement will occur either on the 16th or 1st day of the following month depending on the employee’s return date.

  8. Web Enrollment • Your KEHP Online Access will be available for fast accurate and secure enrollment at http://kehp.ky.gov beginning October 13, 2008. • Employees will need their ID and Password to enroll on the web.

  9. Web Enrollment • Once you complete the enrollment process online, you will see a confirmation number screen. This page will need to be printed out and kept as proof of your enrollment. • A copy of this confirmation MUST be submitted to your college HR Department • If an e-mail address is entered during the enrollment process, you will receive a confirmation message.

  10. Web Enrollment • For assistance with employee ID# and Password contact (866)302-5632 or (502)564-3116 • For computer or technical assistance contact (866)746-1613 or (502)564-4708 • For information about current benefits for 2009 Open Enrollment benefits (877)597-7474 • For other information relating to Open Enrollment contact (888)581-8834 or (502)564-6534 • Hours for Open Enrollment Assistance – 10/13/2008 – 10/24/2008 • Monday through Friday 8:00 am – 8:00 pm • Saturday and Sunday 8:00 am – 12:00 pm

  11. Enrollment – Paper Applications • A paper application will need to be completed on the following scenarios: • A retiree • Paying by cross-reference with a retiree • A new employee who has not yet enrolled for 2008 • Switching the “primary” plan holder on a cross-reference payment option • Current cross-reference payment option that two spouses want to stop • All these applications will need to be submitted to college HR Departments or System Office employee benefits for processing

  12. Dependent Audit • KEHP will be conducting a dependent audit during the 2009 plan year. • Purposes of audit is to verify that each dependent listed on plans is actually eligible for coverage. • Each employee should review the dependent eligibility section for the 2009 Plan Year KEHP Handbook to determine if their dependents are eligible. • If dependents do not meet the eligibility guidelines, employees should remove the ineligible dependents during Open Enrollment.

  13. Dependent Eligibility • Under a new option for 2009, employees will be able to cover their unmarried dependent children up to the end of the month in which the dependent turns 25. • Choosing this new option for unmarried dependent child(ren) may subject the employee contributions to a different tax treatment

  14. Dependent Eligibility • Dependent Child Eligibility • Unmarried • Family-type relationship to the plan holder • Child plan holder • Stepchild • Adopted/placed child • Foster child • Grandchild

  15. Dependent Eligibility • Plan holder is primarily responsible for dependents maintenance and support • Under age 25 • Any person who knowingly with intent to defraud any insurance company by filing an insurance application containing false information or conceals for the purpose of misleading information would be committing fraud which is a crime. This includes adding a dependent to the plan that does not meet the KEHP eligibility guidelines.

  16. Dependent Eligibility • An employee will not be able to pay dependent premiums on a pre-tax basis if the employee’s /plan holder’s dependent(s) CANNOT MEET ONE of these definitions: • Qualifying Child • Qualifying Relative

  17. Dependent Eligibility • Qualifying Child is a child who is unmarried and: • Family-type relationship to the plan holder • Lives with the plan holder in his/her household for more than half of the tax year (exceptions such a “temporary absences” if a full-time student) • Under age 19 and not a full-time student (or under age 24 if a full-time student) as of the end of the calendar year in which the member’s taxable year begins. A “student” means an individual who, during each of the five (5) calendar months during the calendar year in which the employee’s taxable year begins, is a full-time student at an educational organization.

  18. Dependent Eligibility • Qualifying Child (continued) • There is no age requirement if a child is permanently and totally disabled • Individual must not provide more than half of his or her own support for calendar year in which the taxable year of the employee begins.

  19. Dependent Eligibility • Qualifying Relative is a child or other individual who: • Family-type relationship to the member taxpayer (a child of the employee…etc.) and is someone who resides with the employee in his/her household for the member’s taxable year • A person cannot be a “qualifying relative” of the member if at any time during the taxable year the relationship between the member and the person violates federal, state or local law • Receives over half of his/her support from the member taxpayer. (Support includes food, shelter, clothing, medical and dental care education and the like.) • Is not anyone’s (including the member’s) “qualifying child”

  20. Dependent Eligibility • All dependents on the plan age 19-23 to be considered a qualifying child MUST be a full-time student. If they are not, they MUST meet the qualifying relative definition • Employees who choose to add a dependent on their plan year who will turn 24 or 25 during the 2009 plan year will pay their total premiums post tax unless they can show proof that they are eligible for pre-tax.

  21. Dependent Eligibility • Tax Consequences • Paying dependent premiums on a pre-tax basis for an individual who does not meet the definition of “qualifying child” or “qualifying relative” may be in violation of federal tax law • However, if a dependent child fails to meet the requirements of “qualifying child” or “qualifying relative” he or she may be eligible to be covered as a dependent on a post-tax basis pursuant to KEPH plan eligibility defined in KRS 304.17A-256. If you are electing to cover a dependent on a post-tax basis then you must acknowledge the post-tax status.

  22. 2009 Health Plan Choices • Commonwealth Optimum PPO • Commonwealth Maximum Choice* • Commonwealth Capitol Choice* • Commonwealth Standard PPO* *Three of the Four plan choices have no employee contribution for single coverage!

  23. Health Plans • Commonwealth Optimum PPO • Result of combining Enhanced and Premier • 85%-15% co-insurance in-network –70%-30% out-of-network • Single deductible $250, Family $500 • Single Out-of-pocket maximum $1125, Family $2250 • $10 co-pay for office visits • Prescriptions $5.00, $20.00 & $40.00

  24. Prescription Drugs • For the Commonwealth Optimum PPO and the Commonwealth Capitol Choice Plans the Prescription copays are different in 2009: 20082009 • 1st Tier $5 $5 • 2nd Tier $15 $20 • 3rd Tier $30 $40

  25. Health Plans • Commonwealth Maximum Choice • Replaces the Commonwealth Select Plan • Employees with the 2008 Select Plan who pick the Commonwealth Maximum Choice for 2009 will “roll over” any unused 2008 HRA funds into the HRA attached to the Commonwealth Maximum Choice Plan • Retirees are NOT eligible to take the Commonwealth Maximum Choice

  26. Commonwealth Maximum Choice HRA • The KEHP funds the Health Reimbursement Account (HRA) based on level of coverage (these funds are available first day of the plan year): Single $1,000 Couple $1,500 Parent Plus $1,500 Family $2,000 • When these funds are used to pay for medical and prescription services they reduce the deductible. You are responsible for all costs between the HRA funding, and the total deductible. Example: Single coverage has a $2000 deductible, HRA funds are $1000. The $1000 difference between the two, is member’s responsibility. Once the deductible has been met the plan pays 90%, member coinsurance is 10%. Because this plan has no co-pays, once the out of pocket maximum has been reached services are paid at 100%

  27. Example: How the HRA Plan Works • Kelly has the Commonwealth Maximum Choice PPO Plan with a $1000 Health Reimbursement Account (HRA), Kelly’s deductible is $2000: • She has minor surgery at an in-network facility • Humana calculates the provider discount and then Kelly’s doctor sends her a bill for $375 • Kelly writes her HumanaAcccess card number on the bill and sends it back to her doctor • The $375 she paid with her HRA also applies to her deductible • Kelly’s doctor prescribes a prescription drug that costs $125: • Kelly swipes her HumanaAccess card to cover the prescription cost at the pharmacy, paid out of her HRA funds. • The prescription cost also reduces Kelly’s deductible • Kelly’s out-of-pocket costs total is $0 (she used her HRA funds to pay for her services) • Kelly still has $500 left in her HRA • Kelly has now met $500 of her $2000 deductible

  28. HRA/FSA Integration: Commonwealth Maximum Choice Plan • A Health Care Flexible Spending Account (FSA) may be used to fund member responsibility expenses on a tax free basis • Premium savings from selection of the Commonwealth Maximum Choice plan versus other selections may fund or assist in funding a FSA

  29. Health Plans • Commonwealth Capitol Choice • Brand New Plan • $500 per family member “benefit allowance” that provides 100% coverage (subject to co-pays) for many in-network services before you start paying towards the deductible • Benefit Allowance is “use it or lose it” –Does not roll • Co-pays on office visits and prescriptions • After payment of $100 per admission co-pay and $500 annual deductible, you pay nothing for additional hospital facility charges.

  30. How Commonwealth Capitol Choice Works • Steve has the Commonwealth Capitol Choice PPO plan with the $500 benefit allowance, a $500 deductible, office visit co-pay $15 and a 20% co-insurance • Steve’s first claim is for a routine care (annual exam) office visit. • Total charge, after provider discount is $125 • Steve pays his $15 office visit co-pay • The plan pays 100% of the approved balance ($110). The benefit allowance is still $500 • Steve’s second claim is for strep throat, he has an office visit and receives a prescription • Total charge, after provider discount is $85. • Steve pays his $15 office visit co-pay. • The plan pays for the approved balance of $70 from the benefit allowance. The benefit allowance is reduced to $430. • Steve pays his $20 co-pay and picks up his prescription at the pharmacy. • The cost of this prescription does not affect the benefit allowance.

  31. How Commonwealth Capitol Choice Works • Steve has physical therapy following minor surgery, the physical therapy benefit is subject to the deductible then 20% coinsurance. • Total cost of the service after provider discount is $1500 • The Benefit Allowance covers the first $430 ($70 was used on previous service) • Steve is responsible for his $500 deductible, this reduces the claim balance to $570. • Steve is also responsible for $114, which is his 20% coinsurance amount. • Steve has now used all of his benefit allowance and has met his $500 deductible • If Steve had chosen a plan without the benefit allowance, his total member responsibility for this claim would have been $700 ($500 deductible and $200 coinsurance). • Total Bill 1500 • Minus benefit allowance 430 Plan pays • 1070 • Minus Steve’s deductible 500 Steve pays • 570 • Steve’s 20% coinsurance 114 Steve pays • Balance 456 Plan pays

  32. Health Plans • Commonwealth Standard PPO • Replaces the Commonwealth Essential Plan • Higher member deductibles • Higher member co-insurance • Higher annual maximum out-of-pocket • Lower premiums • NEW: A single coverage option is now available

  33. Health Plan Comparisons

  34. Waiving Health Insurance • If you waive health insurance coverage, the employer contribution towards a HRA will be $175 per month for a total of $2100 for the year • If employee is hired with an effective date later that January 1, 2009, the $175 per month for the waiver will be prorated. • Example: Employee is hired on March 1st, with an effective date of May 1st on their waiver with an HRA. The employee would receive $175 per month beginning with the month of May

  35. Health Reimbursement Accounts (HRAs) • Who is NOT eligible for HRAs • If employee or spouse has a Health Savings Account (HSA), you are NOT allowed to have an HRA. If you have an HSA and elect our HRA, you will be in violation of federal tax law. • A retiree who has gone back to work and elects coverage under the retirement system • Retirees • Spouse of a hazardous duty retiree

  36. HRA Two Separate Health Reimbursement Accounts • Embedded HRA • Offered in conjunction with Commonwealth Maximum Choice • Funded with employer money only • Administered by Humana and the DEI • Stand alone HRA • Available only to employees who waive health insurance • Funded with employer money only • Administered by Chard-Snyder (Humana materials may refer to an HRA as a Personal Care Account (PCA)

  37. FSA vs. HRA • In addition to the HRA, an employee may fund a Health Care FSA to reimburse unpaid qualified medical expenses (ex: Deductible, Co-pays, Co-insurance, Dental, Vision, etc.) • May fund with employee contributions • If waiving or have single health coverage, may use all or part of the $50 Benefit for funding • For Commonwealth Maximum Choice Plan participants, when using your HRA, only plan covered expenses will count towards the plan deductible and out-of-pocket maximum (Excludes: Dental, Vision, Over the Counter Medications)

  38. FSA vs. HRA • If you have both a Health Care Flexible Spending Account (FSA) and a Health Reimbursement Account (HRA), reimbursement will come from your FSA account balance first. • The FSA balance is forfeited at the end of the plan year (12/31/08) and 2 ½ month grace period (3/15/09). • The HRA balance will roll-over from year to year as long as you remain a waiver or enrolled in the Commonwealth Maximum Choice Plan. • Will not roll-over if you change your plan selection. NOTE: If you use the Benny PrePaid Benefits Card from Chard-Snyder, reimbursements will automatically be from your FSA first until that annual election amount is depleted. Then, reimbursement will be from your HRA.

  39. Using Benny PrePaid Benefits Card for HRA at Pharmacies – “Waivers” Only • If employee is covered under spouse’s health plan, they would use that health insurance card first. • Employee would then use Chard-Snyder Benny card for any copay or coinsurance amounts due.

  40. Save Your Receipts: HRA Reimbursed Expenses • It is important to save all itemized receipts • The IRS requires proof (substantiation) that expenses are qualified under your plan’s benefits • For the Commonwealth Maximum Choice Plan -Humana automatically verifies transactions, in most cases, as they occur. However, Humana may ask members to submit receipts for verification of an expense • For Waivers, Chard-Snyder automatically verifies transactions, in most cases, as they occur. However, Chard-Snyder may ask members to submit receipts for verification of an expense • Always save all receipts and explanation of benefits (EOB) in case you are contacted to verify an expense that could not be matched automatically • If a refund is needed: • Card should be credited by the provider • If providers refund the member directly the member will be required to refund the card (per IRS guidelines)

  41. Flexible Spending Accounts (FSA) • Employee Money Only • There are two kinds of FSA’s • Health Care Spending Account for medical expenses: • Minimum $ 5 per paycheck( including $50 benefit); total annual maximum : $ 5,004 ($208.50 per paycheck) • Dependent Day Care Account for Dependent care expenses • Minimum $ 5 per paycheck; total annual maximum $4,992 Please refer to the FSA booklet for further information • Maximum Contribution based on tax filing status

  42. Flexible Spending Accounts • Money does not roll from year to year; use it or lose it rule • Can either use the Benny card or file a paper claim for reimbursement • Over-the-counter expenses can be reimbursed • Can be used to get reimbursed for any dependents residing in your household • Substantiation for Benny card may be required.

  43. Flexible Spending Accounts (FSA) • Federal regulations require that employees that wish to enroll in a FSA do so every year • Re-enrollment is necessary to participate in a FSA account either with employee contributions or employer contributions due to the $50 Benefit • The carrier for 2009 will continue to be Chard Snyder and Associates

  44. Flexible Spending Account“Grace Period” • Use left over money from 2008 plan year until March 15, 2009 • (applies to KCTCS personnel system employees only) • Will also apply to 2009 Plan Year (2 ½ monthly grace period will be January 1 – March 15, 2010) • Will apply to all enrolled employees regardless of personnel system

  45. Flexible Spending Account“Grace Period” Reminder • You may use your FSA Benny Prepaid Benefits card for grace period expenses. The Reimbursements will automatically be applied to the correct year • Or, you may also pay for these expenses and then file for reimbursement from Chard-Snyder by mail or fax

  46. Dependent Care Flexible Spending Account • Retirees are not eligible to participate • Amount that can be contributed is based on your tax filing status • Reimbursement by claim form • Benny Card is not available for use with the Dependent Care FSA

  47. Web Enrollment: FSA Flexible Spending Account: FSA Coverage • KCTCS employees will NOTbe able to web-enroll for FSA coverage through the DEI Website • A message will appear that states that KCTCS is non-participating and to contact the Insurance Coordinator

  48. Web Enrollment: FSA FSA Coverage: • FSA Enrollment is a separate process. KCTCS employees will be able to web-enroll for FSA Coverage through the Chard-Snyder Website at www.chard-snyder.com • If employees are currently enrolled in FSA, they will use their current password to web-enroll • Detailed instructions will be available in the Chard-Snyder material available for distribution • You will be able to sign up for your employee health care and/or dependent care elections and any $50 Benefit allocations NOTE: If you are signing up for both a FSA and a HRA, you will be able to do both through the same screen

  49. Web Enrollment: HRA HRA Coverage: • HRA Enrollment is a separate process. KCTCS employees will be able to web-enroll for HRA Coverage through the Chard-Snyder Website at www.chard-snyder.com • If employees are currently enrolled in FSA, they will use their current password to web-enroll • Detailed instructions will be available in the Chard-Snyder material available for distribution NOTE: If you are signing up for both a FSA and a HRA, you will be able to do both through the same screen

  50. $50 Benefit Allowance • Eligibility is open to KCTCS personnel system regular, full-time employees who are enrolled in single healthcare coverage or who have waived healthcare coverage. • You may use the $50 monthly benefit by electing coverage: • To pay for health insurance • To pay for dental insurance • To be placed in Healthcare FSA (FSA form must be completed) • To purchase voluntary supplemental benefit • You mustcomplete a new $50 Benefit Enrollment Form to participate in 2009 • You may notuse this benefit to purchase Group Life Insurance or Supplemental Long Term Disability

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