Thursday, September 30, 2010

HHS posts update on claims submission process for Early Retiree Reinsurance Program

The Department of Health and Human Services (HHS) has posted an ERRP Update on their website regarding preparations for receiving plans’ retiree lists and claims data submissions for the Early Retiree Reinsurance Program (ERRP).

HHS states they will be ready to begin accepting retiree lists in early October, and plans are encouraged to begin preparing for the consolidation and submission of that information. HHS has not yet specified what information should be submitted in the retiree list, but it is likely to include the following member information:
• Social security number
• Name (first, last and middle initial)
• Gender
• Date of birth
• Relationship to early retiree
• Date of retirement (or of coverage under the early retirement plan)

The guidance further clarifies the ERRP reimbursement policy by describing the types of medical items and services which are generally excluded from Medicare coverage. These medical items and services will not credit the program’s cost threshold and will not be reimbursed.

The update also specifies that HHS will begin accepting summary-level claims data in mid-October. HHS also makes reference to submitting more detailed claims information at a later date. It is not yet clear what the format or frequency of either submission type will be.

Friday, September 24, 2010

Senate rejects repeal of 1099 provision in health reform law

In a series of procedural votes, the Senate chose not to move forward on two amendments that sought to completely or partially repeal a tax reporting provision in the new health reform law.

Respective amendments offered by Sens. Mike Johanns (R-Neb.) and Bill Nelson (D-Fla.) each sought a different solution for paring down the reform law's 1099 provision, which in 2012 will require any business that purchases more than $600 worth of goods or services from another business to submit a 1099 tax form to the Internal Revenue Service.

The requirement is expected to save $17 billion over 10 years, but lawmakers and business groups have called for its repeal, claiming it would put a huge tax burden on small businesses. “Even the White House now admits they went too far and their mandate will hurt small businesses,” said Senate Republican Leader Mitch McConnell (R-Ky.).

Nelson, who had suggested exempting businesses with 25 or fewer employees from the requirement, argued that Johann's approach would “gut the reform bill” in order to pay for the repeal.

Neither amendment achieved the 60 votes necessary to proceed to a final vote for possible inclusion in the Small Business Jobs Act.

The FDA restricts use of diabetes drug Avandia

The Food and Drug Administration announced Thursday that access to the diabetes drug Avandia will be restricted to patients with Type 2 diabetes whose condition cannot be controlled with other medications.

The drug has been linked to increased risks of cardiovascular events, such as heart attack and stroke, in patients taking the drug.

Also Thursday, the European Medicines Agency recommended that Avandia be taken off the market. The EMA is Europe’s counterpart to the U.S. Food and Drug Administration (FDA), and is responsible for the approval of all drugs and medical devices sold in Europe. This decision must be ratified by the European Commission before going into effect.

BCBSNC introduces Blue Points promotions for members

Blue Cross Blue Shield of North Carolina (BCBSNC) is introducing three promotions for their Blue Points wellness rewards program.

Blue Points Mailings
Beginning September 8th, two direct mail pieces were sent to the homes of all eligible Blue Points subscribers, approximately 750,000 households. Two different versions were mailed but each household will receive only one version.

Each version is designed to encourage members, whether they’ve used Blue Points before or not, to log into the program and receive 100 free bonus Blue Points. The promotion code Easy100 is provided in each mailing for the members to use.

Blue Points Scratch-off Card
Blue Points scratch-off cards are designed like a lottery card—the member scratches off a silver film to see how many bonus points they win. Members can win points for the following amounts:
• 100 points = $1.00
• 250 points = $2.50
• 500 points = $5.00
• 1000 points = $10.00

These cards are available through Senn Dunn for active group members and will expire on 12/31/10.

Blue Points 5K at the SAS Championship
BCBSNC is sponsoring the inaugural Blue Points 5K on Saturday, September 25 at 8:00 am at Prestonwood Country Club in Cary. Runners will run on the cart path of the golf tournament course before the pros tee off at 10:00 am. Participation in the race grants you access to the tournament on Saturday and there is no need to purchase a Grounds Pass ticket.

If you are interested in participating, you can register online or register on race day. The registration tables open at 7:00 am.

The SAS Championship is a Champions Tour series event. For more information, visit http://saschampionship.com/.

Thursday, September 23, 2010

Early health reform provisions go into effect

Today, September 23, 2010, marks the effective date that some of the earliest provisions of the Patient Protection and Affordable Care Act (PPACA) will go into effect with the start of your new plan year. For example, if your plan renews on January 1st, these provisions will not be effective until January 1st, 2011.

As a reminder, below are the major changes that go into effect:
• Dependent coverage for eligible dependents extended up to age 26
• Restrictions of rescissions other than for fraud or intentional misrepresentation of an important fact on applications
• No pre-existing condition exclusion for children under age 19
• No lifetime dollar limits on health benefits and restricted annual dollar limits
• Ban on discrimination in favor of highly compensated workers*
• Preventive services with no cost-sharing*
• New requirements for internal claims and appeals and external review processes for all health plans and health insurance carriers*
• Right to designate a primary care provider and access to emergency services, pediatricians and OB/GYNs*

*not applicable to grandfathered health plans

These changes are being implemented by your insurance carrier to ensure requirements of the law are met. Remember, the provisions go into effect at the start of your new plan year.

Friday, September 17, 2010

Prescription drugs no longer available in 90-day supply at retail pharmacies through UHC

Effective August 1, 2010, UnitedHealthcare (UHC) members can receive a 3-month supply of certain maintenance medications through mail order only. Previously, members could receive a 3-month supply of these medications at any UHC network retail pharmacy.

To continue receiving a 3-month supply, members must mail order their medication or refill the prescription monthly at a network retail pharmacy. Members should be reminded that over 300 generic prescriptions are available in a 90-day supply for as little as $10 at several national chain retail pharmacies, including Wal-Mart, Target, Walgreens and CVS. This option may be less expensive than mail order through UHC depending on your medication.

PPACA event for small and mid-size employers

The Triad Association of Health Underwriters (TAHU) is hosting a special event on the Patient Protection and Affordable Care Act (PPACA) and its implications for small and mid-size employers. The purpose of this seminar is to educate stakeholders on the impact of the PPACA provisions on employer sponsored health plans. While most federal and state regulations have yet to be written, this seminar will share the most up-to-date information available. All business owners, CEOs, CFOs, HR professionals and CPAs who are responsible for employee benefit decisions are encouraged to attend.

The event will be held:
Monday, October 11, 2010
2:30 - 4:00pm
Embassy Suites, 204 Centreport Dr, Greensboro

This event is open to the public and space is limited. Click HERE to RSVP and reserve your seat!

BCBSNC announces formulary changes effective October 1

Effective October 1, 2010, several drugs will be moved from Tier 2 to Tier 3 of BCBSNC's commercial prescription drug formulary (for under-65 individual and group members). This may result in a higher copay for BCBSNC members taking these medications. Beginning this week, BCBSNC will mail letters about this change to approximately 38,000 impacted members.

Click HERE to view the formulary changes, frequently asked questions and sample member letter.

Friday, September 10, 2010

Further guidance issued on the use of FSA, HRA and HSA funds on over-the-counter drugs

On September 3, the IRS released further clarification on the health reform provision restricting the use of Flexible Spending Account (FSA), Health Reimbursement Account (HRA) and Health Savings Account (HSA) funds for over-the-counter (OTC) medications.

While some OTC items will maintain their current eligibility status, OTC drugs, medicines and biologicals will now require a prescription from a health care provider effective January 1, 2011. Additionally, participants will no longer be able to purchase these items with their debit card. These OTC items will have to be purchased using some other method and the participant will have to submit a Reimbursement Request Form with the receipt and prescription to be reimbursed.

The IRS uses the following example to illustrate proper substantiation: “A customer receipt issued by a pharmacy which identifies the name of the purchaser (or the name of the person for whom the prescription applies), the date and amount of the purchase and an Rx number satisfies the substantiation requirements for over-the-counter medicines or drugs, as does a receipt without an Rx number accompanied by a copy of the related prescription.”

Until further IRS guidance regarding the definition of medical expenses is released, it is likely that the following OTC products will no longer be eligible without a prescription:
• Acid Controllers
• Digestive Aids
• Allergy & Sinus
• Feminine Anti-Fungal/Anti-Itch
• Antibiotic Products
• Hemorrhoidal Preps
• Anti-Diarrheals
• Laxatives
• Anti-Gas
• Motion Sickness
• Anti-Itch & Insect Bite
• Pain Relief
• Anti-parasitic Treatments
• Respiratory Treatments
• Baby Rash Ointments/Creams
• Sleep Aids & Sedatives
• Cold Sore Remedies
• Stomach Remedies
• Cough, Cold & Flu

Special Temporary Statutory Change
In order to allow retailers some time to adjust their inventory systems, the IRS reports that it “will not challenge the use of Health FSA and HRA debit cards for expenses incurred through January 15, 2011. However, on and after January 16, 2011, over-the-counter medicine or drug purchases at all providers and merchants (whether or not they have an inventory information approval system (IIAS) must be substantiated before reimbursement may be made.” Participants should be prepared to obtain receipts and manually submit claims for reimbursement as some merchants may not be ready to allow for the January 15, 2011 statutory change for debit card purchases.

Additional Information for Clients of Flores & Associates
Flores is updating all plan communication materials with this change in mind to be ready for the enrollment of 2011 calendar year plans. Any groups with plans that renew before January 1, 2011 will need to insure that their participants are aware of the change in order to appropriately budget for their FSA. For groups that have already enrolled plans that extend past the January 1, 2011 date, Flores will be preparing an electronic notification to be e-mailed to all participants notifying them of this change before the end of the year.

Thursday, September 9, 2010

Disclosure requirement for grandfathered health plans

To maintain grandfathered status, a plan must include a statement, in any plan materials provided to a participant or beneficiary describing the benefits provided under the plan, that the group believes it is a grandfathered health plan within the meaning of the Patient Protection and Affordable Care Act (PPACA). The plan must also provide contact information for any questions or complaints.

This requirement applies to the first plan year that begins on or after September 23, 2010. The following model language can be used to satisfy this disclosure requirement:

This [group health plan or health insurance issuer] believes this [plan or coverage] is a “grandfathered health plan” under the Patient Protection and Affordable Care Act (the Affordable Care Act). As permitted by the Affordable Care Act, a grandfathered health plan can preserve certain basic health coverage that was already in effect when that law was enacted. Being a grandfathered health plan means that your [plan or policy] may not include certain consumer protections of the Affordable Care Act that apply to other plans, for example, the requirement for the provision of preventive health services without any cost sharing. However, grandfathered health plans must comply with certain other consumer protections in the Affordable Care Act, for example, the elimination of lifetime limits on benefits.

Questions regarding which protections apply and which protections do not apply to a grandfathered health plan and what might cause a plan to change from grandfathered health plan status can be directed to the plan administrator at [insert contact information]. [For ERISA plans, insert: You may also contact the Employee Benefits Security Administration, U.S. Department of Labor at 1-866-444-3272 or www.dol.gov/ebsa/healthreform. This website has a table summarizing which protections do and do not apply to grandfathered health plans.] [For individual market policies and nonfederal governmental plans, insert: You may also contact the U.S. Department of Health and Human Services at www.healthreform.gov.]

New BCBSNC processes for late payments and reinstatement

Please note the following process changes BCBSNC has made regarding late premium payments.

Overdue Payment Notice
Effective September 10, BCBSNC will begin notifying groups of their account status earlier. For groups that have not yet paid their premiums for the current month, a notice will be mailed on the 10th day of the month. Currently, this notice is mailed on the 21st. Claims for services rendered after the paid-through date will be suspended as of the 10th day of the month. Employees will still be able to fill prescriptions during the claim suspension period.

Additionally, the BCBSNC Overdue Payment Notice has been revised to include more detail regarding the employer group’s legal and contractual obligations to their employees with health benefits.

Termination Letter
For groups that have not paid their premiums for the previous month of coverage, BCBSNC will continue to mail notices of termination 37 days from the first day of the month for which payment is due. The BCBSNC Termination Letter has been revised to provide clear guidelines and accurate information about the termination.

Due to new process efficiencies, BCBSNC will begin processing terminations (for non-payment) 38 days from the first day of the month for which payment is due. Today terminations are processed between the 45th and 50th day from the first day of the month in which payment is due.

Reinstatement Policy
BCBSNC has revised and clarified its reinstatement policy, effective October 1, 2010, as follows:
• Requests must be made within 30 days from the date of the group’s cancellation letter.
• Only one reinstatement per group will be permitted in a 12-month period.
• A group cannot have had more than one instance of non-sufficient funds within the last 12-month period.
• The group must be able to pay to the current billed period noted in BCBSNC’s systems.
• Payment must be in the form of a cashier’s check or money order and received within 3 business days of the approval to reinstate.

Tuesday, September 7, 2010

HHS issues guidance on waiver from annual limit requirements for mini-med plans

Late last week, the Department of Health and Human Services (HHS) ruled that a plan or insurer may apply for a waiver from the annual limit requirements for the plan year beginning between September 23, 2010 and September 23, 2011.

Waiver applications must be submitted to HHS (by mail or e-mail) at least 30 days before the beginning of the plan year, and will be processed within 30 days of receipt. However, for a plan year that begins before November 2, 2010, the application must be submitted 10 days before the beginning of the plan year. HHS will process the application no later than 5 days in advance of such a plan year.

The waiver will only last one year and a plan or insurer must reapply for any subsequent plan year prior to January 1, 2014, when the waiver process will expire in accordance with future guidance issued by HHS.

The waiver must include:
• The terms of the plan for which a waiver is sought;
• The number of individuals covered by the plan;
• The current annual limits and rates of the plan;
• A brief description of why compliance with the restricted annual limits would result in a significant decrease in access to benefits or a significant increase in premiums paid by those covered, along with supporting documentation; and
• An attestation, signed by the plan administrator or CEO of the insurance issuer, certifying (1) that the plan was in force prior to September 23, 2010; and (2) that the application of the restricted annual limits would result in a significant decrease in access to benefits or a significant increase in premiums paid.

For more information, click to access the HHS Sub-Regulatory Guidance.

Requirement for federal external review process for self-funded plans

In July, the IRS, DOL and HHS issued an Interim Final Rule (IFR) containing expanded rules for internal claims and appeals of those claims. The IFR also covers a state-based external review process, but did not provide complete guidance on the required federally-based external review system.

On August 23, the DOL published Technical Release 2010-01, which creates a safe harbor that will apply to non-grandfathered, self-funded plans that are subject to the federal external review process for plan years beginning on or after September 23, 2010. This interim safe harbor will apply for plan years beginning on or after September 23 until superseded by future guidance on the federal review process that is currently being developed, to be released by July 1, 2011.

While the safe harbor is in effect, the DOL and IRS will not penalize any plan that complies as follows:

Compliance with NAIC Uniform External Review Model Act
The DOL and IRS will not take enforcement action against any plan that complies with the procedures set forth in the Technical Release 2010-01, based on the Uniform Health Carrier External Review Model Act from the National Association of Insurance Commissioners (NAIC).

Compliance with state external review processes
Alternatively, self-insured employers who do business in a state that already has an external review requirement can be exempt from federal requirements if they agree to comply with the state’s existing external review process AND the state agrees to apply its program to self-insured employers.

For more information, click to view the DOL Fact Sheet, NAIC Uniform Health Carrier External Review Model Act, and the Interim Final Rule.

Friday, September 3, 2010

2010 Mid-Market Survey Seminar cancelled, details on webinar to follow

Thank you to all who participated in our 2010 Employee Benefits Mid-Market Survey! We would like to inform you that we have decided to share the survey results via webinar. As a result, we have cancelled the seminar scheduled for September 16.

A member of your Senn Dunn team will coordinate delivery of your complimentary Individual Custom Report to you prior to the webinar. Details on the webinar date and time will be provided shortly.

We look forward to reviewing the local and national survey results with you!

Enrollment opportunity due to elimination of lifetime dollar limits

Under the Patient Protection and Affordable Care Act (PPACA), health plans can no longer limit overall plan lifetime dollar amounts for plan benefit years beginning on or after September 23, 2010.

According to the interim final rule, plans must provide a notice and enrollment opportunity to otherwise eligible individuals who reached a lifetime limit prior to the effective date of these rules.

The plan must provide the notice and enrollment opportunity by the first day of the first plan year that begins on or after September 23, 2010. Below is model notice language that employers should provide to employees in conjunction with their open enrollment period.

Model Notice
The lifetime limit on the dollar value of benefits under [Insert name of group health plan or health insurance issuer] no longer applies. Individuals whose coverage ended by reason of reaching a lifetime limit under the plan are eligible to enroll in the plan. Individuals have 30 days from the date of this notice to request enrollment. For more information contact the [insert plan administrator or issuer] at [insert contact information].

For your convenience, we have created a template Enrollment Opportunity Notice to address both the lifetime dollar limit and adult children enrollment opportunities. You can use this notice to communicate these opportunities to employees.

For more information on lifetime and annual dollar limits, please refer to the previous post: Agencies issue guidance on several reform provisions, including annual and lifetime limits.

Thursday, September 2, 2010

Adult children enrollment opportunity notice requirement

Under the Patient Protection and Affordable Care Act (PPACA), adult children up to age 26 can be covered under their parents’ health plan for plan benefit years beginning on or after September 23, 2010.

As part of the interim final rule, plans are required to provide newly eligible children a special 30-day enrollment period, including written notice of the opportunity to enroll in the plan.

The plan must provide the notice and enrollment opportunity by the first day of the first plan year that begins on or after September 23, 2010.

Notice of this enrollment right may be provided to an employee on behalf of the employee’s child and can be provided with other enrollment materials. Below is model notice language that employers should provide to employees in conjunction with their open enrollment period.

Model Notice

Individuals whose coverage ended, or who were denied coverage (or were not eligible for coverage), because the availability of dependent coverage of children ended before attainment of age 26 are eligible to enroll in [insert name of group health plan or health insurance coverage]. Individuals may request enrollment for such children for 30 days from the date of notice. Enrollment will be effective retroactively to [insert date that is the first day of the first plan year beginning on or after September 23, 2010]. For more information contact the [insert plan administrator or issuer] at [insert contact information].

Grandfathered Plans
Grandfathered plans may exclude otherwise eligible adult children under age 26 until 2014 if they are eligible for insurance coverage through their employer or, if married, through their spouse’s employer. This stipulation should be added to the notice provided by grandfathered plans.

For your convenience, we have created a template Enrollment Opportunity Notice to address both the lifetime dollar limit and adult children enrollment opportunities. You can use this notice to communicate these opportunities to employees.

For more information, please refer to the previous post: Interim final rule released on provision extending dependent coverage to age 26.

BCBSNC to implement changes to prescription drug prior review and restricted access lists

Effective October 1, 2010, Blue Cross and Blue Shield of North Carolina (BCBSNC) is implementing changes to their prior review/certification and restricted access drug lists in an effort to continue providing high-quality, cost-effective health care. All of the drugs impacted are covered as part of a member’s prescription drug benefit.

All users of the following drugs will be subject to the new prior review/certification requirement:
• Naproxen/esomeprazole (Vimovo ®) – for chronic arthritis conditions in patients at risk of gastric bleeding
• Dalfampridine (Ampyra®) – used to improve walking in patients with multiple sclerosis
• Antinarcoleptic Agents (Provigil®, Nuvigil®) – for certain wake-sleep disorders

New users of the following drugs will be subject to the new prior review/certification requirement:
• Disease-modifying drugs for multiple sclerosis (Betaseron®, Extavia®, Avonex®, Rebif®, Copaxone®)
• Oral drugs for pulmonary arterial hypertension (Letairis®, Tracleer®, Revatio®, Adcirca®
• Cyclosporine ophthalmic (Restasis®) – for moderate to severe dry eyes

Members using one of the nonpreferred brand-name tetracyclines (Doryx® or Solodyn®) will be required to have their physician submit written certification to BCBSNC stating that the member has previously tried at least one of the preferred medications.

Communications to Providers and Members
BCBSNC participating providers were notified of these changes in July. BCBSNC will mail letters to impacted members in early September. Because prior review/certification will only be required for new users of the drugs listed in the second bulleted item above, no member notification will be sent to members who are already taking one of these medications.

HSA rule changes effective in 2011

The enactment of the Patient Protection and Affordable Care Act (PPACA) is expected to have little impact on Health Savings Accounts (HSAs), except for the following changes:

Reimbursement for over-the-counter drugs and medicines
Beginning January 1, 2011, the list of qualified medical expenses for HSAs will exclude over-the-counter drugs unless the drug is a prescribed drug or insulin.

Additional tax on HSA distributions used for ineligible expenses
Beginning January 1, 2011, the additional tax on disbursements from HSAs that are not used for qualified medical expenses will be increased from 10% to 20% of the disbursed amount.

For more information, please refer to our previous post: Health reform to restrict the use of FSA, HRA and HSA funds on over-the-counter drugs.