Purdue Benefits IS A HIGH-DEDUCTIBLE MEDICAL PLAN YOUR BEST CHOICE? TAKING THE MYSTERY OUT OF...
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Transcript of Purdue Benefits IS A HIGH-DEDUCTIBLE MEDICAL PLAN YOUR BEST CHOICE? TAKING THE MYSTERY OUT OF...
Purdue Benefitswww.purdue.edu/benefits
IS A HIGH-DEDUCTIBLE MEDICAL PLAN YOUR BEST CHOICE?TAKING THE MYSTERY OUT OF HIGH-DEDUCTIBLE HEALTH PLANS AND HEALTH SAVINGS ACCOUNTS
Agenda
o High-Deductible Health Plan With HSA
High-Deductible Health Plan Basics
Health Savings Account (HSA) Basics
IRS Says
How It Works
Scenarios
Plan Tips (How To Make It Work For You)
Purdue Benefitswww.purdue.edu/benefits
High Deductible Health Plan Basics
HIGH DEDUCTIBLE HEALTH PLAN BASICS
High-Deductible Health Plan Plus HSA
Plan Basics
Health Plan
(HDHP)
Health Savings Account (HSA)
Purdue Health Plans Plus HSA
o Created as a way to help with rising health care costs
Offer tax advantages for medical expenses
Provide HSA owners with control of where dollars are being spento HSA owners are generally more
interested in how funds are being spent when they own the account
Health care providers have incentive to lower rates due to a more competitive environment
Background
o Intent of high-deductible health plans and HSA Improved version of FSA with retirement savings feature
Allows unspent funds to roll over every year Employers are not required, but are able to contribute Account earns interest and offers investment options Account goes with you if you leave Purdue Able to save funds for retirement medical expenses, including
premiums Remember that funds used for non-medical expenses are fully taxable
Prevalence of plans According to Mercer’s National Survey of Employer-Sponsored
Health Plans 2012: o 36% of 2,809 employers surveyed offer an HDHPo Up from 20% in 2008
Background
Plan Basics
Deductible
Premium
Coinsurance
Out-of-Pocket Maximum
Preventive Care Contributions
Account Management
High-Deductible Health Plan (HDHP)
Health Savings Account (HSA)
Withdrawals
o High-Deductible Health Plan Lowest premiums compared to more
traditional health plans
Higher deductible and maximum limit on out-of-pocket covered expenses in a calendar year
Includes both medical and prescription costs
100% coverage with in-network providers for preventive care and preventive generic medications for certain conditions (i.e. asthma, diabetes, heart disease and stroke,
prenatal vitamins, smoking cessation)
Plan Basics
High Deductible Health Plan (HDHP)
Deductible
Coinsurance
Out-of-Pocket
Maximum
Preventive Care
Preventive Care
Plan Basics
High Deductible Health Plan (HDHP)
Deductible
Coinsurance
Out-of-Pocket
Maximum
Preventive Care
Preventive Care
o Preventive care 100% covered with in-network providers, includes but not limited to: Annual exams, routine prenatal and well-child
care, and child and adult immunizations Preventive (non-diagnostic) screening services
e.g., cancer, diseases (heart and vascular, infectious) Conditions: metabolic, nutritional, endocrine, mental
health, obstetric and gynecological, and pediatric Disorders (musculoskeletal, vision and hearing)
Eligible preventive medications For certain conditions such as: asthma, heart disease
and stroke Prenatal vitamins, generic contraceptives approved by
the FDA, smoking cessation
Plan Basics
2014 Deductible
In-Network Out-of-Network
Purdue Health Plan Plus HSA 1
$1,750 employee only$3,500 family
$3,500 employee only$7,000 family
Purdue Health Plan Plus HSA 2
$ 2,500 employee only$ 5,000 family
$5,000 employee only$10,000 family
o Deductible Phase: You pay 100% of all eligible expenses up to
the plan's annual deductible. Includes: Non-preventive medical visits and services
o Doctor visits, labs, diagnostics, hospitalizations
Non-preventive prescriptions
High Deductible Health Plan (HDHP)
Deductible
Coinsurance
Out-of-Pocket
Maximum
Preventive Care
Preventive Care
Plan Basics
2014 Prescription CoinsurancePurdue Health Plan Plus HSA 1& HSA 2
Prescription Type
Home Delivery(90 day supply)
Retail(30 day supply)
Preventive Generic
0% 0%
Generic Ded. then $25 max Ded. then $10 maxPreferred Ded. then 25% Ded. then 35%Non-Preferred Ded. then 45% Ded. then 55%
2014 Medical Coinsurance In-Network Out-of-Network
Purdue Health Plan Plus HSA 1 20% 40%Purdue Health Plan Plus HSA 2 25% 45%
*Member Pays the Difference program is still in effect.
o Coinsurance Phase: After meeting your deductible, you pay a
smaller percentage of expenses High Deductible Health Plan (HDHP)
Deductible
Coinsurance
Out-of-Pocket
Maximum
Preventive Care
Preventive Care
Plan Basics
Annual Out-of-Pocket Maximum
In-Network Out-of-Network
Purdue Health Plan Plus HSA 1
$3,500 employee only$7,000 family
$7,000 employee only$14,000 family
Purdue Health Plan Plus HSA 2
$ 5,000 employee only$ 10,000 family
$10,000 employee only$20,000 family
o Out-of-Pocket Maximum Phase: Plan pays 100% of eligible medical and
prescription drug costs once you meet the annual maximum
This is the most you will pay for medical and prescription drugs during 2014
High Deductible Health Plan (HDHP)
Deductible
Coinsurance
Out-of-Pocket
Maximum
Preventive Care
Preventive Care
Purdue Benefitswww.purdue.edu/benefits
High-Deductible Health Plan
HEALTH SAVINGS ACCOUNT (HSA) BASICS
o What Is An HSA? A bank account – called a health savings
account (HSA)
Offers tax advantages and allows savings to build over time
Available with high deductible health plans only
Administered by PayFlex
Debit card allows convenient access to funds in the account
Account access via web and mobile File claims, view account balance,
transfer funds, etc.
Plan Basics
Health Savings Account (HSA)
Contributions
Withdrawals
Account Management
2014 HSA
IRS Contribution Limit
Purdue Contributions
Remaining Employee Contribution Allowed
Employee $3,300 $650 $2,650
Family $6,550 $1,300 $5,250
o HSA Contributions
Purdue contributes, and you have the option to contribute to the same account
Plan Basics
Health Savings Account (HSA)
Contributions
Withdrawals
Account Management
o HSA Contributions
Contributions are deposited pre-tax and available for use on or after each pay date
Age 55 or older any time during 2014, eligible to contribute an additional $1,000
Update contributions any time during year through EBenefits
Option to contribute after-tax
Plan Basics
Health Savings Account (HSA)
Contributions
Withdrawals
Account Management
Plan Basicso HSA Funds
Remaining funds in account roll over every year, never lose contributions Even if you separate or retire
Funds earn interest and grow tax-free with investment options available once minimum balance is met Potential for long-term, tax-free savings
No limit on account balance
Funds available to beneficiary in the event of death
Health Savings Account (HSA)
Contributions
Withdrawals
Account Management
o HSA Withdrawals Funds never taxed when used for eligible
expenses such as: Medical (e.g. doctor visit, hospital stay) Prescription and Over-the-counter drugs
(with doctor's prescription) Vision (e.g. contacts, glasses) Dental (e.g. fillings, braces)
Upon retirement , use funds tax-free for medical premiums and eligible medical expenses Including COBRA, Medicare premiums and supplement
plans, and long-term care premiums
Age 65 or older able to pay tax and withdraw funds with no tax penalty for any reason
Plan Basics
Health Savings Account (HSA)
Contributions
Withdrawals
Account Management
o HSA Withdrawals Pay eligible expenses of any family member
who qualifies as a dependent on your tax return, even if you cover only yourself Dependent must be covered under plan, for
expenses to apply toward your plan’s deductible
Same-sex domestic partners are eligible to be covered under an employee’s HDHPo Partner must be employee’s qualified tax
dependent for University’s HSA family contribution to apply
o Tax-free distributions can be made from the HSA for the qualified tax dependent’s health expenses
Plan Basics
Health Savings Account (HSA)
Contributions
Withdrawals
Account Management
Plan Basicso HSA Withdrawals
Flexibility to pay expenses from HSA or pay out-of-pocket and reimburse yourself Direct deposit option available
Use funds for you, your spouse, and your tax dependents, even if you cover only yourself
Keep your receipts for expenses If not an eligible expense:
o Pay tax on purchase(s)o 20% tax penalty
Health Savings Account (HSA)
Contributions
Withdrawals
Account Management
o Limited Purpose Flexible Spending Account (LPFSA) In addition to the HSA, you
have the option to contribute pre-tax to a Limited Purpose FSA (LPFSA)
May only be used for eligible dental and vision expenses
Funds are available for use immediately
Must use funds by end of year (use it or lose it rule)
2014 contribution limit of $2,500 per employee
Plan Basics
o Limited Purpose Flexible Spending Account (LPFSA) If you choose the LPFSA with
your HSA, you will receive one card
PayFlex’s technology will understand which purchases should be applied to your Limited Purpose FSA before your HSA
Claim forms and direct deposit available if you choose to pay out of pocket and reimburse yourself
Plan Basics
Purdue Benefitswww.purdue.edu/benefits
IRS SAYS
High-Deductible Health Plan Plus HSA
o To offer an HSA with a high-deductible health plan, certain IRS rules apply
Higher deductible and out-of-pocket maximum with lower premiums than traditional plans
Must combine medical and prescription expenses to one deductible and out-of-pocket maximum
Offer preventive care and certain preventive medications at no cost
Charge fair market value for services (i.e., No “low or no” cost services)
IRS Says
o To participate in an HSA, certain IRS rules apply You must be covered under a high-
deductible health plan (HDHP)
You cannot be covered under any non-HDHP plan in addition to your Purdue HDHP plan
If your spouse has non-HDHP coverage, you cannot be covered by that plan
If you elect an HSA, your spouse cannot have a health care FSA
You cannot be claimed as a dependent on someone else's tax return
IRS Says
Insurance or accounts not allowed with an HSA: Non-HDHP medical
coverage Health care flexible
spending account (HCFSA) or a Spouse's HCFSA
Part A and/or Part B Medicare
TRICARE or TRICARE For Life
Any VA benefits used within previous 3 months
IRS Says
You can have additional insurance that provides benefits for the following items: Accident Disability Dental care Vision care Long term care Specified disease or illness Insurance that pays a fixed
amount per day for hospitalization
o To participate in an HSA, certain IRS rules apply
o To participate in an HSA, certain IRS rules apply You must keep records to show:
Funds were used exclusively to pay or reimburse qualified medical expenses,
qualified medical expenses had not been previously paid or reimbursed from another source, and
medical expenses had not been taken as an itemized deduction in any year
Expenses incurred before you establish your HSA are not qualified medical expenses
IRS Says
o To participate in an HSA, certain IRS rules apply If funds are withdrawn for
anything other than a qualified medical expense prior to retirement, you are subject to taxes plus a 20% tax penalty
IRS Says
o Special Limitation Groups Long Term Disability
Not eligible for HSA
COBRA Not eligible for HSA
Over 65 Active Employees Eligible for HSA, if not covered
under Medicare (including Part A)
Under 65 Retirees Not eligible for HSA
Over 65 Retirees Not eligible for HSA
Purdue’s Special Rules
Purdue Benefitswww.purdue.edu/benefits
HOW IT WORKSHigh-Deductible Health Plan Plus HSA
o Doctor’s office
Show your Anthem ID card
Doctor’s office processes through Anthem
Your doctor’s office will bill you for any amount owed
Amount owed will count toward your medical/prescription deductible and out-of-pocket maximum
Choose to use your HSA card or another form of payment
How It Works
o Pharmacy
Show your Anthem ID card
Pharmacy processes through Express Scripts
Payment due at time of purchase
Choose to use your HSA card or another form of payment
Amount owed will count toward your medical/ prescription deductible and out-of-pocket maximum unless you choose a brand name prescription over generic (Member Pays The Difference)
How It Works
o Eye care provider
Show your Purdue ID card
Choose to use your HSA/LPFSA card or another form of payment
o Dentist’s office
If you are covered under a Purdue dental plan, show your Purdue ID card
Choose to use your HSA/LPFSA card or another form of payment
How It Works
Purdue Benefitswww.purdue.edu/benefits
SCENARIOSHigh-Deductible Health Plan Plus HSA
Purdue Health Plan
Purdue Health Plan Plus HSA 1
Purdue Health Plan Plus HSA 2
Annual deductible
= $750
Annual deductible
= $1,750
Annual deductible
= $2,500
Sandy pays: Sandy pays: Sandy pays:
Annual premium $747 $178 $0
+
Deductible + $750 + $1,000 + $1,000
Coinsurance + $50 N/A N/A
Claims paid using Purdue contribution
N/A - $650 - $650
Sandy pays medical expenses + annual premium
$1,547 $528 $350
Scenarios Sandy: Employee only with $1,000 in medical costs*
Under $44,000 annual salary $44,000 and above annual salary
Purdue Health Plan
Purdue Health Plan Plus HSA 1
Purdue Health Plan Plus HSA 2
Annual deductible
= $750
Annual deductible
= $1,750
Annual deductible
= $2,500
Sandy pays: Sandy pays: Sandy pays:
Annual premium $1,496 $497 $0
+
Deductible + $750 + $1,000 + $1,000
Coinsurance + $50 N/A N/A
Claims paid using Purdue contribution
N/A - $650 - $650
Sandy pays medical expenses + annual premium
$2,296 $847 $350
*Scenario assumes in-network providers are used in all cases.
Purdue Health Plan
Purdue Health Plan Plus HSA 1
Purdue Health Plan Plus HSA 2
Annual deductible
= $750
Annual deductible
= $1,750
Annual deductible
= $2,500
Sandy pays: Sandy pays: Sandy pays:
Annual premium $747 $178 $0
+
Deductible + $750 + $1,750 + $2,500
Coinsurance + $850 + $650 + $625
Claims paid using Purdue contribution
N/A - $650 - $650
Sandy pays medical expenses + annual premium
$2,347 $1,928 $2,475
Scenarios Sandy: Employee only with $5,000 in medical costs*
Under $44,000 annual salary $44,000 and above annual salary
Purdue Health Plan
Purdue Health Plan Plus HSA 1
Purdue Health Plan Plus HSA 2
Annual deductible
= $750
Annual deductible
= $1,750
Annual deductible
= $2,500
Sandy pays: Sandy pays: Sandy pays:
Annual premium $1,496 $497 $0
+
Deductible + $750 + $1,750 + $2,500
Coinsurance + $850 + $650 + $625
Claims paid using Purdue contribution
N/A - $650 - $650
Sandy pays medical expenses + annual premium
$3,096 $2,247 $2,475
*Scenario assumes in-network providers are used in all cases.
Purdue Health Plan
Purdue Health Plan Plus HSA 1
Purdue Health Plan Plus HSA 2
Annual deductible
= $750
Annual deductible
= $1,750
Annual deductible
= $2,500
Sandy pays: Sandy pays: Sandy pays:
Annual premium $747 $178 $0
+
Deductible + $750 + $1,750 + $2,500
Coinsurance + $1,650* + $1,750* + $2,500*
Claims paid using Purdue contribution
N/A - $650 - $650
Sandy pays medical expenses + annual premium
$3,147 $3,028 $4,350
Scenarios
Purdue Health Plan
Purdue Health Plan Plus HSA 1
Purdue Health Plan Plus HSA 2
Annual deductible
= $750
Annual deductible
= $1,750
Annual deductible
= $2,500
Sandy pays: Sandy pays: Sandy pays:
Annual premium $1,496 $497 $0
+
Deductible + $750 + $1,750 + $2,500
Coinsurance + $1,650* + $1,750* + $2,500*
Claims paid using Purdue contribution
N/A - $650 - $650
Sandy pays medical expenses + annual premium
$3,896 $3,347 $4,350
Sandy: Employee only with $40,000 in medical costs*Under $44,000 annual salary $44,000 and above annual salary
*Scenario assumes in-network providers are used in all cases.
Purdue Benefitswww.purdue.edu/benefits
PLAN TIPSHigh-Deductible Health Plan Plus HSA
Tipso Take advantage of your 100% covered preventive
benefits, including preventive medications
o Talk with your doctor or pharmacist Be open and honest, keep the line of communication open As the patient, you have the right to know
Ask the tough questions Make sure to get copies of medical records and imaging to reduce
duplicate services
o Use Tier 1 labs for the best savings www.purdue.edu/hr/Benefits/Medical/purdueChoiceFund.html#Tier1labs
o Check out the Center for Healthy Living for a high quality, low cost option $45 flat fee for center visits No-cost health coach services
Tobacco cessation Medication therapy management Nutritional counseling Employee assistance counseling
Convenient online scheduling option Tier 1 lab location
o Lower your costs for prescriptions Use generics Try home delivery Check with retailers for low cost
prescription programs
Tips
Tipso Always show your insurance
information, even when you have to meet your deductible Medical and prescription
expenses In-network provider discounts
o Keep your receipts and explanations of benefits (EOBs)
o Consider a Limited Purpose Flexible Spending Account Vision/dental expenses
o Check in to additional coverage with accident / critical illness insurance options
Tipso Benefit from the triple tax advantages
Contributions you make are pre-tax Consider contributing what you
would have paid for 2013 premiums
Add what you would typically contribute to your FSA
Funds in HSA grow with interest tax-free You have option to allow HSA to build
now, save funds for later
Funds are tax-free when used for eligible expenses Continue to use HSA funds tax-free on
eligible expenses after retirement, including Medicare premiums
Tipso Choose the right level
of care and save Sample costs for
established patient visit for sinus infection symptoms Assumes 2014 cost No labs/tests included
Convenience Care ClinicAmount Billed $89.00
Discount* $28.00
What’s left to pay $61.00
Immediate Care/Urgent CareAmount Billed $148.00
Discount* $46.35
What’s left to pay $101.65
Center for Healthy LivingAmount Billed $45
Discount $0
What’s left to pay $45.00
* Based on 2013 Cigna discount
o Use available technology Center for Healthy Living
Schedule appointments online
Castlight Shop around for care
Express Scripts Price medications and
order home delivery refills
PayFlex (Healthhub) Track your expenses
EBenefits Update HSA contributions anytime
Tips
Center for Healthy Living
1.Schedule an appointment
2.View lab results from your visits with the center
Castlight1.Search personalized cost and quality information for in-network providers and services
2.Track how close you are to meeting your deductible
3.Connect seamlessly to Express Scripts for prescription pricing, ordering and more
4.See tips to help manage you health care
Castlight1. View your
family’s spending, including:
medical prescription what Purdue
paid
2. Review past medical spending to see how much you paid and why
CastlightCastlight Mobile
Available for iPhone, Android and other smartphones
View personalized cost and quality information
View provider details Check your deductible and out-of-
pocket maximum status
Castlight Guides By Phone Full access over the telephone Call toll-free 888-272-9572, Monday -
Friday, 8 a.m. - 9 p.m.
Castlight www.purdue.edu/castlight
Express Scripts1. Order home
delivery prescriptions
2. Make the switch from retail to home delivery
3. Track your prescription expenses and view history
Express Scripts1. Price
medications and compare costs:
Retail vs. home delivery
Brand name vs. generic equivalent
PayFlex1. View account
details and history
2. File claims, view eligible expenses, and order additional debit cards
3. Update settings to receive email/text notifications
4. Enroll in direct deposit, submit documents online
PayFlex1. Link your bank
account to transfer funds to and from your HSA with ease and view investment options
2. Set up recurring transactions, print claim forms, and use planning tools
PayFlex Mobile Access real-time account information Account balances Claims status Transaction details
Account alerts
Submit claims
Take pictures of receipts and submit from your phone
PayFlex
EBenefits1. Increase and
decrease HSA contributions at any time during the year
Resources
Purdue Benefits
www.purdue.edu/benefits
www.purdue.edu/hrhelpTry HR’s new secure message tool!
765-494-2222
Anthemwww.anthem.comCheck out Anthem’s tools and resources today!
Castlight www.purdue.edu/castlightMobile app available!
888-272-9572
Center for Healthy Living
www.purdue.edu/healthylivingNow schedule appointments online!
765-494-0111