BCBSKC Broker Reform Presentation
	Broker Brochure

To view Blue KC’s broker handouts, click below:

	Dependant Coverage
	Employer Early Retiree Reinsurance
	Employer Mandate
	Grandfathering Existing Coverage
	Individual Mandate Subsidy
	Product Design Mandates
	Summary of Employer Taxation Provisions
	Summary of Insurer Tax Provisions
	Summary of Key Provisions
	Summary of Medicare Advantage and Part D Provisions
	Summary of Provisions on Exchanges
	Summary of Provisions on New Insurers
	Summary of Rating Reforms
	Temporary Federal High Risk Health Pool
	Uniform Coverage Documents and Definitions
	Wellness Programs

Background on Health Coverage for Early Retirees

• Nationwide, early retiree coverage has dropped from 66% in 1988 to 31% in 2008.
• The Affordable Care Act provides $5 billion to employers to help them maintain coverage for early retirees age 55 and older who are not eligible for Medicare.
• Employers can use this financial assistance to reduce their own health care costs, provide premium relief to workers or a combination of both.

Who is eligible?

• Private or governmental employers that provide insured or self-funded health benefits to retirees age 55 and older (and their dependents including surviving spouses) and who are not eligible for Medicare.

How to participate in the program?

• To be eligible, the group health plan must apply to and be certified by the Secretary of Health and Human Services (HHS). The program will go into effect on June 1, 2010 and applications are expected to be available by the end of June.
• Companies can apply for reimbursement if they believe they are eligible and offer early retiree insurance.

What is the amount of reimbursement?

• The amount of reimbursement to the employer is up to 80% of claim costs for eligible retirees for health benefits between $15,000 and $90,000. In 2010, claims incurred between the start of the plan year (often January 1) and June 1st are credited towards the $15,000 threshold for reimbursement. However, only medical expenses incurred after June 1, 2010 are eligible for reimbursement under this program.

Funds allocated for the program are not expected to last through 2014, when the program will cease existence. Funds will be available on a first come first serve basis, creating a sense of urgency for eligible employer groups. In 2014, early retirees will be able to obtain insurance through the State Exchanges that will be established.

Will Blue KC apply for funds on behalf of its client?

• Blue KC cannot apply on behalf of our clients under this program. The employer must apply.

What if clients need help determining whether they should apply?

• Blue KC will be developing a process to provide historical claims data to clients in an aggregated format to facilitate a decision by the group on whether to apply. We expect this process to be in place by the end of May.

How will Blue KC support clients during the application process?

• The application will require that employers demonstrate that they have implemented programs/procedures that have generated or have the potential to generate cost savings for participants with chronic and high cost conditions. For those clients where Blue KC provides case management and disease management, Blue KC will provide necessary information to employers upon request so that they can complete this part of the application.
• The application also requests that employers project expected claims under the reinsurance program for the first two years. Blue KC will provide expected claims experience to employers upon request to meet this application requirement.
• The application requires that employers ensure that policies and procedures are in place to protect against fraud, waste and abuse for this program and that if requested by HHS, that the policies be produced as well as any documentation or data to substantiate the implementation of the policies and their effectiveness. Blue KC is evaluating this requirement and how our internal policies may or may not be applicable to this requirement.

NOTE: The regulations require that employers have a signed agreement with their insurance carrier or third party administrator at the time of application. As a result, Blue KC will require a signed agreement with the employer prior to providing the assistance outlined above.

Blue KC is currently developing this agreement and expects to have it available by the end of May. We are also currently building internal processes/documents to support this assistance and Sales team members will be trained to handle inquiries as this process is finalized.

How will Blue KC support the need for claim reimbursements once an employer has been certified under the program?

• Under HIPAA privacy rules, Blue KC cannot provide non-aggregated claims data to our insured and cost plus clients unless the Plan Sponsor has amended its plan documents to restrict uses and disclosures of PHI by the Plan Sponsor consistent with the HIPAA Privacy Rule. We anticipate most of our insured and cost plus clients do not have these procedures in place. For these clients, Blue KC will submit claims on behalf of our clients who have obtained certification for the program upon request.
• For ASO (Administrative Services Only) clients, Blue KC will provide data directly to the employer for submission. Alternatively, Blue KC will submit claims directly for the ASO client upon request, but the submission will be limited to those claims that are administered by Blue KC.

Further guidance on claims file formats and content is expected. A team has begun to evaluate the requirements that were included in the regulation in an effort to be able to support these requests timely once employers are certified. Sales team member will be trained to handle inquiries on our business processes related to these claim reimbursement requests as internal processes are finalized.

Will I be charged for the Blue KC Assistance?

• Blue KC will provide this assistance as a service to our clients and no separate fee will be charged.

Five billion dollars has been allocated by the government for this program. We do not expect these funds to last through 2014, when the program will cease existence. It will be first come, first served, creating a sense of urgency for eligible employer groups. In 2014, early retirees will be able to obtain insurance through the State Exchanges that will be established.

The program will go into effect June 1, 2010, and applications will be available by the end of June. Companies can apply for the reimbursement, if they believe they are eligible and offer early retiree insurance currently. Upon request, Blue Cross and Blue Shield of Kansas City can provide certain information necessary as part of the application process, such as projections of claims and a summary of the chronic/high cost condition programs we offer. More details on this, including the cost of these reports, will be available by the time the program starts.

The program is somewhat complicated, and as we receive more information we will determine how best to put a process in place to assist our employer groups in taking advantage of the program. We expect to have further clarification on this within a couple weeks. We will keep you informed as more information and details become available.

The Department of Health and Human Services (HHS), as part of health care reform, is allocating $5 billion for the program nationwide for people with health conditions that have prevented them from obtaining health insurance coverage. The program will cease in 2014 when guaranteed issue and a mandate go into effect. Secretary Kathleen Sebelius calls the high risk pool a “bridge strategy for those who can’t get insurance.”

The federal government will step in to administer a high risk pool in those states which choose to opt out of the program. We expect further clarification on the high risk pool on or around July 1, 2010.

Effective for 2010, many small businesses and not-for-profit organizations providing health insurance to their employees will qualify for a special tax credit of up to 35% (25% for tax-exempt organizations). This tax credit is designed to encourage small businesses to offer or continue to offer health insurance to their employees. There are certain eligibility criteria that must be met, and that information is available at www.IRS.gov. In general, the tax credit is available to small businesses that pay at least half the cost of single coverage for their employees, employ fewer than 25 employees AND pay wages averaging less than $50,000 per year.

The maximum credit (i.e. 35%) is available to smaller employers, those with ten or fewer employees, paying annual average wages of $25,000 or less per year. In 2014, the tax credit will increase to 50% of premiums paid by eligible small businesses and 35% of premiums paid by eligible tax-exempt organizations.

Phase I – Launched July 1, 2010
Basic information on each plan offered by insurance carriers will be provided on the Web portal. Information such as Plan name, what type of plan (individual or group), geographic availability, and links to further information/brochures/formularies will be required at this time.  The Web portal will also provide information on Medicaid, CHIP and high risk pools.

Phase II – Launched in October
More detailed information on each plan is required from insurers by September 3, 2010, and will include information regarding premiums, rating methods, benefits and cost-sharing. Insurers will be required to submit information on their plans that have at least one percent of the insurers total enrollment for each market type in a zip code that is open for enrollment. We are currently evaluating the plans we provide to determine which ones will be included on the Web portal.

Future phases of the HHS portal will require insurers to display additional information, including percent of policies that are rescinded; percent of claims denied; and the number of appeals on denials to insure, pay claims and provide pre-authorizations.

Blue Cross and Blue Shield of Kansas City Proactively Helps Parents Keep Their Children Covered, Avoid Coverage Gap

Kansas City, Missouri (April 22, 2010) — Blue Cross and Blue Shield of Kansas City announced today that it is taking steps to allow young adults to remain on their parents’ health plans until the end of the calendar year in which they turn 26 years old. This proactive measure is effective June 1, 2010, and ensures all individuals graduating college in May will not experience a gap in insurance coverage.

Health care reform legislation, signed in March, will extend the dependent age for coverage to 26 years for plan years beginning September 23, 2010. Blue Cross and Blue Shield of Kansas City’s proactive steps today will make sure that all dependents graduating from college in May can still be insured under their parents’ plans. The company is working in collaboration with the U.S. Department of Health and Human Services and state regulators in providing this expanded coverage.

Most Blue Cross and Blue Shield of Kansas City’s member dependents are already covered until the end of the year in which they turn 25 years old. When dependent children lose coverage, they can be enrolled in one of the company’s direct pay plans, ensuring no one is left without coverage.

“Implementing these measures in June, instead of waiting until the end of September, makes sense and it’s the right thing to do,” said David Gentile, President and CEO Elect of Blue Cross and Blue Shield of Kansas City.

This is just one way Blue Cross and Blue Shield of Kansas City is committed to working to provide an effective and workable implementation of the new health care reform law.

The Count On Us campaign was started to give members, employer groups and brokers the assurance that Blue Cross and Blue Shield plans are here to help people make sense of the new health care reform legislation, and we will do what it takes to comply with the regulations as they are established. While we still have some concerns about reform, namely the cost increases we see as inevitable, there are also other elements of reform that we are pleased to see. As a result of reform, 32 million Americans will now have access to coverage, and pre-existing health conditions will no longer be excluded.

We hope you find this advertorial reassuring and helpful.

Count On Us

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For the last year, the nation’s attention has been focused on reforming our healthcare system. On behalf of our 100 million members coast to coast, including nearly one million members here in Kansas City, Blue Cross and Blue Shield is committed to working with the Administration and other parties to implement this new law.

As we have throughout our 73-year history, we will continue to help people navigate the healthcare system, especially now when many are confused and unsure about what reform means to them. Being a part of the Blue Cross and Blue Shield of Kansas City family offers the advantage of local decisionmaking and responsiveness along with national reach. More than just a membership card, it means receiving the best service regardless of where you live or what kind of health plan you have. It’s about financial security in times of healthcare necessity. It’s also about investing in the Kansas City community where we live and work.

We acknowledge the need for reform, and support the expansion of care to more Americans. We also support the issuance of coverage despite health status or pre-existing conditions. In addition, we have already begun the process of change by collaborating with local physicians and hospitals on ideas for a smooth implementation of the reforms.

However, while our nation has enacted new healthcare laws, much work remains. We all have a role to play in building a better healthcare system. We must make fundamental changes to how care is delivered so that people don’t just have access to care, but that everyone receives the highest quality care. We must address the rising cost of healthcare and bring spending in line with costs in other areas of our economy. And we all must become more responsible for our own health by exercising more and living healthier lives.

At this moment of change, our members can rest assured that we will remain true to the not-for-profit heritage that always has differentiated Blue Cross and Blue Shield of Kansas City. In that spirit, we are committed to moving forward and helping make this legislation work for all Americans.

Count on us.