Human Resources

Health Benefit Changes FAQ

Frequently Asked Questions for benefit changes effective 1/1/2013

This site is a list of questions frequently being asked about the upcoming benefits changes. To ask a question, contact your Benefits representative or email laurie.lus@srpmic-nsn.gov. Questions and corresponding answers should appear the following day, but this will depend on volume of questions asked.

Q: What is changing about the benefits?

A: The Gold and Silver plans are going away and there will be three completely new plans: a Low-Deductible, Mid-Deductible and High-Deductible plan. All three new plans will have deductibles and coinsurance. For more information, go to the main Benefits Changes 2013 site and click on Information.

Q: What is NOT changing about the benefits?

A: The services! All services as outlined in the Schedule of Medical Benefits (in the big “orange book” that gives the details of the plans) will remain the same. The only positive service change is that Mayo Clinic will now be in network for all plans. Dental, vision and pharmacy will not be changed in any way (please note under the High-Deductible Plan, pharmacy benefits are subject to the deductible first and then the copays kick in). There will be no change in Dental premiums. Finally, no copays will change for the plans that have copays (except Emergency Room copays). Copays in the new Low-Deductible Plan will be the same copays that were in the Gold Plan; copays in the new Mid-Deductible Plan will be the same copays that were in the Silver Plan.

Q: Can I stay in the plan I am currently in?

A: No. The current Gold and Silver plans will no longer exist as of January 1, 2013. Make a choice of one of the three new plans during Open Enrollment in November. If you do not make a choice, you will be defaulted into the plan closest to your existing plan (Gold participants will default to the new Low-Deductible Plan; Silver participants will default to the new Mid-Deductible Plan).

Q: What is the best Plan to choose?

A: This depends upon your individual circumstances. There will be tools coming out that will help give you an idea how much out-of-pocket expenses you might have to pay under each plan option. But out-of-pocket cost is not the only factor that should be considered.

Q: Will there be any changes to vision, dental or pharmacy/prescription?

A: No. There will be no changes to vision, dental or pharmacy.

Q: Will any of the covered services be changing?

A: The only change in covered services will be that Mayo Clinic will now be in network for all of the new plans. Otherwise, there are no changes in covered services.

Q: Do I have to pay a copay AND coinsurance for a service?

A: If you use a service that is a copay service, you only pay the copay. Coinsurance is for services for which there are no copays (i.e., a hospital stay, non inpatient lab tests, etc). So, depending on the service, and what plan you are on, you will either pay a copay or coinsurance, but not both. There is one exception to this rule, that is the surgeon fees for Bariatric Surgery. Note that under the High-Deductible Plan (HDHP), there are no copays except for pharmacy. In other words, under the HDHP, there is no such thing as a copay service other than pharmacy.

Q: What costs go toward the out-of-pocket maximum?

A: Only coinsurance applies toward the out-of-pocket maximum. Deductibles, copays and premiums do NOT count toward the out-of-pocket maximum.

Q: Will I be responsible for coinsurance on the original billed amount, or on the contracted/discounted amount?

A: The contracted amount. By being a Blue Cross provider, the provider has agreed to accept the Blue Cross contracted rates, so that is all you will have to pay coinsurance on.

Q: How do I know what plan I’m currently on?

A: There are a couple of ways to get this information. First, you can contact Benefits and they should be able to tell you. Or, you can look at your last paycheck where medical benefits were taken. Look in the “Before Tax-Deductions” box. Multiply the Current amount by two and match that back to the Rate Comparison sheet that was included in the pdf under Information in this website.

Q: Are the rates listed in the Rate Comparison monthly rates or per paycheck rates?

A: They are monthly rates. Divide them by two (2) to arrive at the per paycheck amount.

Q: How do deductibles work? Do I pay 100% of bills until deductible is met? Or 20% of each bill until deductible is met?

A: Like car insurance, you pay 100% of the bills until the deductible is met. Under the Low- and Mid-Deductible Plans, you will only receive bills for services that are not “copay services” (there is no such thing as a copay under the High-Deductible Plan (HDHP)). For example, if you go to an office visit or wellness visit, you will, like before, only be responsible for the copay for that visit. Note, however, that copays do not count toward deductibles. For non-copay services (like hospital, dialysis, DME, and many other covered services), or for any service received under the HDHP, you will pay 100% of the bills you receive until you have met the deductible. So, for example, if you are on the Low-Deductible Plan and you go into the hospital, and you have paid no other bills up until that point, you will pay the first $500 in bills for the hospital stay.

Q: If my spouse is on my insurance, or if it is just me and one child, will we have to meet the “household” annual out-of-pocket amount, or the individual one?

A: You would have to reach the sum of the individual ones. So, for coverage of just two people, you would have to reach $4k in-network/$8k out-of-network under the Low-Deductible Plan; $6k in-network/$12k out-of-network for the Mid-Deductible Plan; or $6k in-network/$12k out-of-network under the High-Deductible Plan.

Q: Will there be different copays/coinsurance on preventive services (wellness visits, etc.)?

A: For required Health Reform wellness services, those are paid by the plan at 100% with no deductible. Check the Schedule of Medical Benefits when it comes out or contact Benefits for a list of services that fall under this category.

Q: Will there still be FSAs?

A: Yes. For Low- and Mid-Deductible plans, you can still participate in the same type of FSAs that were available under Gold and Silver. Those FSAs can be used to pay for qualified (per IRS), unreimbursed medical, dental and vision expenses, including any deductibles. For the High-Deductible plan, you can only have what is called a “limited” FSA in addition to your HSA (see “Questions about HSA” section of the FAQs for info about HSAs). Limited FSAs can only be used for eligible (per IRS) non medical dental and vision expenses and cannot be used toward the High-Deductible deductible.

Questions about HSA

Q: Is the HSA available under all three plans?

A: No, the HSA is only available if you choose the High-Deductible Plan.

Q: If I am eligible for IHS, am I eligible to have an HSA?

A: Per IRS guidance: “An individual who is eligible to receive medical services at an IHS facility, but who has not actually received such services during the previous three months, is an eligible individual … who may establish and make tax-free contributions to an HSA. However, an individual generally is not an eligible individual if the individual has received medical services at an IHS facility at any time during the previous three months.”

Q: What are the contribution limits for an HSA?

A: These limits are tax-year specific and the limits may be different for 2013. Check Publication 969 at www.irs.gov for specific 2013 limits when that information becomes available. For reference only, for 2012, for self-only High Deductible Plan (HDHP) coverage, eligible individuals could have contributed up to $3,100; for family HDHP coverage the maximum contribution was up to $6,250. Note, that no one at the Community was “eligible”, though, in 2012 because the Community did not offer an HDHP for that year.

Q: What are the limits for use of HSA funds?

A: If you use funds from your HSA to pay or be reimbursed for qualified medical expenses you incur after you establish the HSA, those funds are tax-free. If you withdraw and use HSA funds for other reasons, the amount you withdraw will be subject to income tax and may be subject to an additional 20% tax. Please note, unlike an FSA that is a “use it or lose it” type of account, you do not have to make distributions from your HSA each year – in other words, the funds stay in the account and carry over from year to year without penalty.

Q: What can I use my HSA funds to pay for?

A: You can use your HSA to pay for eligible (per IRS) unreimbursed medical, dental and vision expenses, including deductibles.

Q: Can I use my HSA funds to pay my deductible?

A: Yes.

Q: What is the difference between an FSA account and an HSA account?

A: First, an FSA is a spending account (FSA stands for flexible spending account). You must spend the money within the year it is set aside. An HSA is a savings account (HSA stands for health savings account). This means you may save your HSA money until you need it, even if you don’t need it until many years later.

Second, FSA’s can be made available regardless of the type of healthplan you participate in. HSA’s are only for those who participate in a high-deductible plan (HDHP).

Third, the Community does not contribute funds into FSA’s, but does contribute $40/month into HSA’s.

Fourth, the contribution limits set by the IRS are different for FSA’s than they are for HSA’s. These limits are subject to change by the IRS each year. For 2012, if you had self-only HDHP coverage, you can contribute up to $3,100. If you have family HDHP coverage you can contribute up to $6,250. For tax years beginning after 2012 your contribution to your FSA is limited to $2,500.

Q: Does an HSA account earn interest?

A: Yes. And the interest is tax exempt.