If you have ever been confused by the jargon used in
managed care or insurance policies, here are a few
definitions to help.
Note: These definitions are not tax advice. We recommend contacting licensed CPAs specializing in tax.
Section 6055 and Section 6056 forms & filing requirements mandated under ACA. These forms detail information provided by one of the following: Federal Exchange/State Exchange/IRS/Employer for self funded plans, or Employers of fully insured plans offered to employees.
1095-A is sent to INDIVIDUALS from the Federal Marketplace.
1095-B is sent from self insuring employers or insurance providers and detail compliance with minimum essential health coverage.
1095-C is provided by (ALEs) employers to employees.
The tax filer must use the information on Form 1095-A to complete Form 8962 (Premium Tax Credit) and file it with his or her federal tax return.
see: New Republican bill:
https://housegop.leadpages.co/healthcare/ Federal Info at HHS:
An organization allowed by CMS to enter into risk /non-risk bearing contracts to care for assigned Medicare and/or Medicaid lives. Commercial demonstration projects may also be submitted for review by CMS. ACO’s generally provide full range of medical services. Central to ACO purpose is the elimination of traditional FFS provider compensation within optional "Shared Services" at-risk 3 year term contracts. FFS contracts are also offered. ACO's actively focus upon outcomes of care and bundling of care surrounding chronic disease and high cost procedures case management. FYI: in 2015 the OIG estimated that 29% of the federal budget was spent on major medical programs by the Federal Government.
see Next Generation ACO ACO Risk Contract/CMS Fact Sheet
An MLR legislated ACA value requirement of "metallic" level plan pricing. "Issuers in the Individual Marketplace can choose to offer one or more “standardized options” with a specific cost-sharing structure at the Bronze, Silver, and Gold levels.
Each standardized option consists of a fixed deductible, fixed annual limit on cost-sharing, and a fixed copayment or coinsurance with specified applicability of the deductible for a key set of essential health benefits that comprise a large percentage of the total allowable costs for an average enrollee. Issuers that offer a Silver standardized option must also offer the three associated standardized Silver plan variations for cost-sharing reductions (i.e., 73% actuarial value, 87% actuarial value, and 94%" actuarial value). (source: MLM training by CMS)
An insurer that is both authorized and Eligible to place insurance within a given state. Admitted carriers enjoy protected status against competing Surplus Lines carriers who are not subject to the same premium taxation. Admitted carriers enjoy State Insurance Guarantee Association protection, whereas. Surplus Lines carriers do not.
Advance Premium Tax Credit: The premium discount amount a person earning between 100% - 400% of FPL is eligible. The credit is paid by the federal government directly to the health insurance company each month.
Advanced Aggregate is reinsurance provided to ERISA exempt entities. Reinsurance over multiple self funded employers is provided by advancing aggregated coverage recoveries for risk between specific retention and a percentage of the fully funded and underwritten major medical insurance premium.
Tax credit people earning between 100% -400% FPL are eligible related to commercial insurance premiums. It also refers to Medicare eligible beneficiaries that may also be purchasing a tax credit eligible plan.
Term used to calculate if a Group (QHP employer offered plan) is affordable for purposes of avoiding a employer tax penalty, or Individual employee eligibility for a ACA available tax credit. (for 2017) Mainland FPL for 2016 affordability determination is $11,770 (9.66%) = $94.75. Means if employee earing $11,770 is required to pay more than $94.75 per month for QHP, that employee is eligible for INDIVIDUAL marketplace tax credit, and the (ALE) employer gets fined $3,240 for EACH employee getting a marketplace plan with tax credit.
The Patient Protection Affordable Care Act is referred to as the Affordable Care Act/ACA/PPACA. The ACA (Affordable Care Act) is a 2310 page law encompassing all medical care in the US, but with very limited application to Veterans affairs, approved Limited Medical Plans and underwritten Medicare Supplemental plans. ACA compliant plans mandate: 10 minimum essential benefits (MEB) without annual benefit limits, tax credits for individuals earning below 400% of Federal Poverty Level (FPL), and Cost Sharing for people earning between 100%-250% of FPL. Cost sharing lowers deductibles and max-out-of- pocket costs, and limits personal total annual health expense (spend) from (about) 2% to a maximum of 9.66% (2017) AGI/MAGI. Small employers (under 25 FTEs) are now offered tax credited plans through SHOP. Small employers are now offered tax credited plans through SHOP. Shop tax credits can by 50% for year on and 35% for year 2. Insurance is provided be commercial carriers, not the government. See Eligibility for Advance Payment. Similar to Medicare Advantage plans, Individual and Small Group Insurance is offered and managed by commercial carriers, not the government.
Means: Patient Protection and Affordable Care Act
(Public Law 111-148), as amended by the Health Care and Education Reconciliation Act
of 2010 (Public Law 111-152), which are referred to collectively as the Affordable Care
Aggregate Pharmacy Reinsurance is a program of coverage which shifts the financial risk of pharmacy benefits from the employer, PBM or risk bearing entity to the reinsurer. Coverage typically triggers at 110%-125% of the expected annual budgeted amount.
Aggregate Stop Loss provides coverage against an entire population's budget overrun in a calendar year. Coverage typically reimburses the policy owner when claims exceed 110 percent - 125 percent of the expected annual claim volume.
A "second" deductible on top of the "specific" deductible that must be paid by the insured to "itself". I.e. If the Specific (per person per year deductible) is $50K and the ASD is $100K, then the insured will pay up to $100K (to itself) of all eligible claims excess of $50K until it reaches $100K. At that point, the reinsurer then reimburses "all" eligible claims excess of $50K. Properly done, the insured "self-funds" (deposits in a separate personal account each month), an amount equal to 1/12th of the $100K to be available for "expected" claims payment.
This process effectively avoids: Premium tax, agent commission, and carrier profit margin, carrier overhead load, reinsurance costs, and actuarial fudge factor thereby lowering "expected" costs" on an additional $100K of premium.
A term used by LAN (CMS or Medicare administrators under HHS) to describe the identification, reporting and/or creation of new provider payment methodologies, and whose goals include increasing (private payers, providers, employers, state partners, consumer groups, individual consumers, etc) engagement, to drive lower (Medicare, Medicaid, Commercial, Workers Comp, Auto, etc) medical costs and better medical outcomes. Many are watching as republicans move to scrap many methods being tested to align better outcomes with hospital and physician reimbursement incenting maximum procedure production versus "some" attempt at avoiding or curing the problem from happening in the first place.
ACA law eliminates annual limits on 10 essential health benefits. Grandfathered INDIVIDUAL may still have plan limits. Individuals are allowed to keep their grandfathered plan until Sept 2017 or after if their carrier is ACA compliant. All Group plans must be ACA compliant.
The applicable federal rate (AFR) is set monthly by the IRS and used for various purposes under the Internal Revenue Code, including for imputed interest and original issue discount rules. The AFR is normally available during the third or fourth week of the month. It is used for purposes of establishing a loan interest rate applied to Collateral Assignment Split dollar Life Insurance ( see SERP)
An employer of sufficient size (typically involving groups over 50 FTEs, but can also include smaller groups) to fall under section 6055 or 6066 of the ACA law, and who is required to file forms 1095B and 1095C (health plan and employee information) with the government.
A tax credit entitlement legislated by ACA that reduces the amount of monthly premium an eligible person must pay to buy commercial health insurance. Tax credit is applied to eligible insureds earning between 100% and 400% of FPL. Form 1095-A must be submitted annually with each tax return to qualify for the credit. The Form is provided by the commercial carrier and attached to the individual tax return to maintain eligibility for the tax credit.
Balance billing is the difference between an out of network (non contracted) provider billed charge, and "contracted rate" (insured by the policy), charged to the patient. Balance billing amounts do not attribute to deductibles or out of pocket expenses, and can create substantial uninsured liability for members receiving Out Of Network (OON) care. Balance billing issues are highly contentious, and subject to dispute.
The amount and limit of medical insurance provided within an insurance plan document, or Summary of Benefits. Benefits are typically summarized by: Deductible , Co Insurance, Copay, and out of pocket maximum. Additional benefits may also be part of the Package such as Dental, Life, LTC, STD, etc at customer option.
Recently polulgated DOL rule related to "investment" disclosures required of Financial Advisors, Financial Planners and some insurance agents placing retirement plan related investments involving qualified (non taxed retirement) funds. These may also include non-risk bearing Fixed Indexed Annuities (FIAs). Several challenges are in litigation now by very large entities, and exactly what settles is a guess. Compliance is mandated within by April 2016, or January 2017. Operationally speaking, it may well boil down to what types of "retirement - investment" illustrations will require a signed customer acknowledgement prior to final sale. Where a fiduciary standard is imposed (for any investments funded with qualified money), a BIC sign-off will be required by a "registered financial advisor".
Fact Sheet: https://www.dol.gov/ebsa/newsroom/fsconflictsofinterest.html
Best Interest Contract. A term used to convey a fiduciary standard in the best interest of the customer. Lots of rules related to part of implementation, but the two dates to remember are April 2017, and January 2018 for full compliance. Triggering a fiduciary rule standard may not necessarily apply to recommendations involving non qualified funds. Recommendations involving qualified monies trigger a fiduciary standard. This is not advice but only general information. Check with DOL for certainty of where the rule applies.
A single medical reimbursement amount defined however a medical provider wants to offer there services. (i.e. OB deliveries, dialysis, factor therapy, transplants, etc.) Services are typically stated in terms of a fixed reimbursement amount by specific diagnosis, or episode of care. Some refer to them as "full value-based reimbursement". An implied goal to the "value-based" amount is tied to EBM, or outcome of care.
A Capitation is a fixed dollar amount per member per month (PMPM) paid to providers regardless of medical utilization. This contract shifts the catastrophic financial risk from the insurance company to the physician and/or hospital. Provider Excess Loss is purchased to pay potential catastrophic claims and prevent insolvency.
In the context of medical second dollar risk contracts, it refers to deleted risk exposures like Transplant, Neonatal, Cancer, ESRD, out-of-network risk, pharmacy, or any medical benefit exclusion within a managed care agreement.
A process directed by a licensed nurse or physician, or an unlicensed specialist trained to manage, coordinate, steer and direct efficacious and efficient care in conjunction with an insured member’s physician. Goal is to increase patient well being and reduce cost.
A fixed hospital reimbursement by episode or diagnosis, and inclusive of all care. Outlier codes are also available to accommodate comorbidity issues and challenges. Typical case rates are promulgated by HHS on Medicare patients as defined Diagnostic Related Group (DRG codes).
Medical centers offering disease or procedure specific care that are known for favorable medical outcomes and or pricing. i.e. Transplants, Cardiac, Cancer, ESRD, Neonatal. These centers are typically defined by "condition specific nurse case management teams' that can also include hands on reinsurer personal "support" and steerage.
Relative to hospital billing, it is a schedule of maximum charges billed to a customer. Charge Master amounts are limited to contractual limits agreed to by hospitals. Those without insurance get hit with the maximum amount which can exceed 300% - 1000%more than a typical contracted rate. A charge master can also refer to the schedule a provider is obligated to accept as full payment.
A program of medical care usually directed at members with: asthma, diabetes, high blood pressure, back pain, and/or high cost or chronic disease conditions. The goal of these programs is to lower typical costs of treatment and improve medical outcome for the member.
An optional TERM life insurance policy feature that acts almost identically to a Long Term Care benefit allowing 2% - 4%/yr of death benefit payout in the event of satisfying pay out trigger. The insured qualifies when 2 out of 6 ADL's produce "significant cognitive impairment" thereby allowing BOTH coverage for unexpected death, AND a long-term-care-like benefit within the same policy.
In Stop Loss, Co Insurance is the percentage of eligible charges reimbursed to the stop loss policyholder after the deductible has been satisfied. In major medical insurance, Co Insurance is percentage of eligible charges the individual policy holder is required to pay the medical provider for services rendered after the deductible has been satisfied. In primary medical insurance, co insurance can be the percentage of medical claims paid by the insured up to the maximum allowed by ACA
Federal Law requiring employers with more than 20 employees to extend Medical Benefits to severed employees leaving employment for up to 18 to 29 months. Costs for insurance are born by the employee. Employers under 20 employees generally direct their employees to Mini-Cobra in Florida allowing them access to various benefits.
Affordable Care Act (ACA) included an optional program called Community Living Assistance Services and Supports, or CLASS, that would have paid caregivers, including family members with no professional training in caregiving, to help older Americans stay in their own home and not access long-term care in institutional settings.
The CLASS program was fashioned, however, as a voluntary endeavor with enrollees choosing whether or not to enroll, unlike traditional social insurance programs such as Medicare that mandate enrollment. But this voluntary enrollment feature, when combined with the ACA’s explicit mandate that the CLASS program be self-financing, made that program unsustainable and it was repealed in early 2013. Nevertheless, a publicly administered and funded social insurance program that would pay family caregivers remains an option beyond its present Medicaid context.
An employer premium rating method based on claims history by region (zip code). ACA promulgates rules employers (over 50 FTE) MUST apply (higher priced) community rating, thereby eliminating potential premium discounts associated with favorable claims experience.
CPC+ is a five-year model that will begin in January 2017.
CMS has provisionally selected 57 payer partners, including commercial insurers, state Medicaid agencies, Medicaid managed care organizations, and Medicare Advantage plans in 14 regions across the nation.
Comprehensive Primary Care Plus (CPC+) is a national advanced primary care medical home model that aims to strengthen primary care through a regionally-based multi-payer payment reform and care delivery transformation. CPC+ will include two primary care practice tracks with incrementally advanced care delivery requirements and payment options to meet the diverse needs of primary care practices in the United States (U.S.). The care delivery redesign ensures practices in each track have the infrastructure to deliver better care to result in a healthier patient population. The multi-payer payment redesign will give practices greater financial resources and flexibility to make appropriate investments to improve the quality and efficiency of care, and reduce unnecessary health care utilization. CPC+ will provide practices with a robust learning system, as well as actionable patient-level cost and utilization data feedback, to guide their decision making.
An ACA designated health plan authorized to sell insurance, and predicated on a community of care givers designed to lower cost and improve evidence based medical outcomes or quality. Many CO-OP's have failed leaving their insureds scrambling for coverage mid year, and leaving area medical providers with large unpaid bills.
A Contingency Fee is compensation to the agent above the commission. This fee is not usually discussed with the client. It can be similar or identical to an underwriting profit or override on profitable business sales. In larger brokerages, these "fees" are usually negotiated by senior management, where the local agent is unaware the fees exist. RIMS recently mandated a policy statement that these fees be clearly divulged by all agents to avoid the appearance of impropriety.
Credit Life Reinsurance is coverage provided to insurance companies writing mortgage payment insurance. It can take the form of Specific, Aggregate, Quota Share and/or Surplus Relief depending on the needs of the insurance company being served.
Sometimes referred to as Retention, or threshold, a Deductible is the dollar amount exceeded before a policy pays all, or part of an eligible claim. In most Stop Loss and Reinsurance, deductibles accrue independently of any co insurance or copays. In most individual and Group major medical insurance, a deductible includes most Copays and OOP spent on eligible care.
A Medicare assigned reimbursement by diagnosis code. Many rules apply. Some DRGs allow for "outlier" modifier codes causing certain events to qualify for greatly increased eligible reimbursement to reflect comorbidity events.
In context to medical stop loss or reinsurance, disclosure means the presentation of claims data and Large Claimants. Typical reporting includes reporting anyone in the hospital, not actively at work and/or whose claims exceed 50% of the solicited stop loss/reinsurance deductible. Most all carriers also demand reporting by "catastrophic" diagnosis as well. Successful disclosure is required prior to binding or firming stop loss offers.
In addition to the level of coverage plans, issuers in the individual market can offer catastrophic plans. Eligibility for catastrophic plans is limited to:
Individuals under age 30 before the plan year begins
Individuals who have a certification from the Marketplace that they are exempt from the responsibility requirement because they do not have an affordable coverage option, or because they qualify for a hardship exemption (Source Healthcare.com)
As part of the application process, the Marketplace determines an individual’s eligibility for advance payments of the premium tax credit and cost-sharing reductions based on projected household income relative to the FPL. Household income is the sum of a tax filer’s MAGI, and the MAGI of the tax filer’s dependents who are included in the tax filer’s family and required to file a federal income tax return. Additionally, the Affordable Care Act requires all states to determine eligibility for Medicaid and CHIP for the majority of individuals (essentially, all non-disabled, non-elderly individuals) based on their MAGI. MAGI is adjusted gross income within the meaning of the Internal Revenue Code, plus any excluded foreign earned income, tax-exempt interest received or accrued during the taxable year, and non-taxable Social Security benefits. Assets are not considered in determining eligibility. This income methodology is the same for determining eligibility for advance payments of the premium tax credit and cost-sharing reductions, and determining eligibility for Medicaid and CHIP, with the following exceptions: https://www.cms.gov/CCIIO/Resources/Regulations-and-Guidance/Downloads/ARR-2017-Guidance-051016-508.pdf
The ERISA Act provides federal laws and regulations pertaining to the operation of self funded health plans for single employers, unions, trusts, and associations. ERISA plans are effectively immune to state insurance laws and regulations regarding assumption of risk and solvency standards. However, Plans sponsored by municipalities may be regulated by the domiciled state. These plans may include Life, Health, Dental, etc as part of the Group plan(s) offerings. The purchase of Specific and Aggregate reinsurance is optional, but usually done to transfer the risk of unpredictable catastrophic claims.
Employee-Pay-REB Split Dollar Plan
When the employer owns the life insurance policy and pays the entire premium for it in a split dollar plan—the insured employee must pay the income tax on the reportable economic benefit (REB) which is the amount of premium paid by the employer each year.
ACA mandate requiring employers with more than 50 full time equivalent full-time-employees (FTEs) to buy medical insurance for their employees, or Pay $2,000 per head (after 30 FTE’s “deductible”). FTE is defined as an employee working more than 30 hours. ACA requires employers with sister corporations to count all their allied companies employees toward the 50 FTE mandate.
A term used to denote care delivered from beginning to end of treatment. Episode of care is the vernacular being used by Payors attempting to fashion reimbursements schedules or contracts with providers inclusive of all services delivered over a specified period, or by medical outcome desired.
Episode Payment Models (EPMs); Cardiac Incentive Payment Model; and Changes to the Comprehensive Care for Joint Replacement Model
On August 2, 2016, the Centers for Medicare & Medicaid Services (CMS) published four new payment models and refinements to a current model through a notice of proposed rulemaking to further advance care coordination for Medicare fee-for-service (FFS) beneficiaries, which will begin on July 1, 2017.
Three new episode payment models (EPMs) would test making participants financially accountable for the quality and cost of episodes of care helping achieve the goal of higher quality at a lower cost for the following episodes:
• An acute myocardial infarction (AMI), including both medical therapy and percutaneous coronary intervention (PCI),
• A coronary artery bypass graft (CABG), and
• A surgical hip/femur fracture treatment, excluding lower extremity joint replacements (SHFFT).
The Cardiac Rehabilitation (CR) incentive payment model for EPMs and Medicare FFS participants would test financial incentives for Inpatient Prospective Payment System (IPPS) hospitals that encourage the management of beneficiaries following an AMI or CABG toward greater utilization of CR services.
The proposed rule can be found on the Federal Register. See CMS fact sheet and press release.
Essential community providers (ECPs) include providers that serve predominantly low income
and medically underserved individuals, and specifically include providers described in
section 340B of the PHS Act and section 1927(c)(1)(D)(i)(IV) of the Social Security Act.
"The first of these proposals relates to network adequacy
review for QHPs. The modified approach would not only lessen the regulatory burden on
issuers, but also would recognize the primary role of States in regulating this area. The second
change would allow issuers to use a write-in process to identify essential community providers
(ECPs) who are not on the HHS list of available ECPs for the 2018 plan year; and lower the ECP
standard to 20 percent (rather than 30 percent), which we believe would make it easier for a QHP
issuer to build networks that comply with the ECP standard."
Also relates to Network Adequacy standards Source HHS https://s3.amazonaws.com/public-inspection.federalregister.gov/2017-03027.pdf?utm_campaign=hcgov_ab&utm_content=english&utm_medium=email&utm_source=govdelivery
10 categories of unlimited insurance coverage defined under ACA that create a Qualified Health Plan. Categories include: Maternity & Newborn care, Hospitalization, Emergency Services, Pharmacy, Laboratory, Pediatric Vision & Dental, Rehabilitative Services and devices, Emergency Services and Preventive/Chronic disease medical treatment.
This is a standard Clause that means coverage is afforded after all other available insurances have been exhausted. It can also be associated with language stating coverage being applied to all medical charges the client is at risk for unless specifically excluded by design.
Excess of Loss is a type of Stop Loss or Reinsurance coverage that triggers after a specific and or aggregate deductible is satisfied. These policies take many forms, and insure many types of risk. This coverage may employ a Specific deductible or variations within an aggregating specific deductible. It is “second dollar” coverage.
Meaning set forth in 45 CFR 155.20An online site accessing ACA compliant medical and dental plans that is managed/funded by the federal government (HHS).
14 states did not expand Medicaid or create their own commercial insurance exchange or Marketplace, and have relegated administration to the federal government.
The word MarketPlace or Exchange means the same. Technically, the exchange was detailed in the original ACA law, and can be referred to as the Federally Facilitated Market place or Exchange. Most refer to it as the MarketPlace, for either the 14 states the federal government sponsors or the individual state paid for service. Note, that a CO-OP or Cooperative may have different distribution and plan access parameters.
Experience Credit aka Premium Refund aka Minimum Premium aka Profit Commission aka Terminal liability aka Alternate Funding aka Experience Refund policy. A premium rebating feature that returns excess premium when claims are lower than a negotiated loss ratio typically under 70%.
An highly qualified medical professional accepted by a workers compensation court for purposes of determining the percentage of medical claims injury caused by a work related activity v the percentage caused by a preexisting medical condition. Expert Medical Advisors report on Major Contributing Cause (MCC) of medical claims loss. Findings of cause being 51%+ caused by a work related activity means the claim is eligible for workers compensation insurance response provided the court accepts the findings.
Orthopedic Surgeons are considered EMA's.
See MCC, IME, DWC25 form, MSA, MMI
A process that meets minimum standards set forth under ACA/HHS regulation related mostly to coverage exclusions or insurance denials. ACA details greater consumer appeal rights for denied or under-reimbursed medical claims. Self Funded (ERISA) plans are held to a different standard than Individual plans, mostly limited to review of insurance eligibility.
Facultative reinsurance is coverage where a Reinsurer evaluates a specific risk on a case- by-case basis. Typically, the primary insurer has no obligation to submit NEW risks to the reinsurer, and the reinsurer is free to accept or reject any risks submitted by the primary insurer or ceding company. Facultative reinsurance can also be referred to as Pro Rata or Excess of Loss coverage. Typically, the reinsurer accepts the same percentage of claim liability as billed premium. Each policy is different.
HHS Increases Civil Monetary Penalties
September 6, 2016 by Heather Landi
The U.S. Department of Health and Human Services (HHS) issued an interim final rule Sept. 2nd that raises various civil monetary penalty amounts to adjust for years of inflation.
“The Department of Health and Human Services (HHS) is promulgating this interim final rule to ensure that the amount of civil monetary penalties authorized to be assessed or enforced by HHS reflect the statutorily mandated amounts and ranges as adjusted for inflation. Pursuant to Section 4(b) of the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (the 2015 Act), HHS is required to promulgate a “catch-up adjustment” through an interim final rule. The 2015 Act specifies that the adjustments shall take effect not later than August 1, 2016,” HHS stated in the interim final rule.
The rule noted the new maximum penalties apply to any fines assessed after Aug. 1, 2016, as well as all penalties stemming from violations that took place after Nov. 2, 2015.
Under the interim final rule, some civil monetary penalties will nearly double due to inflation adjustments.
HHS increased the penalty for a HMO or competitive medical plan that implements practices to discourage enrollment of individuals needing services in the future by 106 percent from $100,000 to $206,000. Hospitals with 100 beds or more now face penalties of more than $103,000 if they dump patients needing emergency medical care. That’s up from the $50,000 penalty established in 1987.
Circumventing Stark Law’s restrictions on physician self-referrals will now cost $159,000, a 59 percent increase from the original $100,000 penalty established in 1994.
Some penalties are relatively small, such as the penalty for payments by a hospital or critical access hospital to induce a physician to reduce or limit services to individuals under the direct care of the physician or who are entitled to certain medical assistance, which increased 115 percent from $2,000 to $4,300.
Many updated penalties affect both Medicare and Medicaid managed-care companies. HHS raised the penalty for a Medicare Advantage organization that improperly expels or refuses to reenroll a beneficiary by 47 percent, from $25,000 to $36,794. Medicare Advantage organization that substantially fail to provide medically necessary, required items and services will now face penalties of more than $37,000, an increase from $25,000. The penalty for a Medicare Advantage organization that charges excessive premiums went up from $25,000 to $36,794.
And, a Medicaid MCO that improperly expels or refuses to reenroll a beneficiary now faces a $197,000 monetary penalty, up from $100,000.
The federally created and managed platform designed for accessing ACA eligible INDIVIDUAL and SHOP plans in states that opted out of creating their own state based exchange / Marketplace for medical insurance.
A Fee Schedule is an explicitly detailed schedule used by the carrier to determine the eligible amount charged. In many stop loss coverages, the RBRVS schedule is used for re-pricing physician fees The Medicare maximum allowable amount, and or DRG's are commonly used as well in pricing the hospital reimbursement. The fee schedule used dramatically effects eligible and reimbursable charges. Commonplace are variations of charges for the same service rendered by medical providers, contract and insurance type. Variations in what is considered the eligible and reasonable charge can be contentious.
Finite Reinsurance is defined by the Reinsurance Association of America as "a highly structured reinsurance contract where structured elements reduce the amount of risk assumed by reinsurers to the point that it may not meet the accounting requirements of risk transfer." Finite reinsurance is typically coverage transferring little or no risk, and is designed to pay known losses, or improve issues related to cash flow from irregular market conditions involving interest rates, and asset values. It typically improves financial ratios related to compliance, and capital surplus reserves. There are many types of finite loss development coverages. The essence of coverage may amount to a line of credit to pay known losses today and reimburse the reinsurer by amortized future premium payments. NAIC has recently agreed on a uniform policy form.
Sometimes called firm quote, or "a bindable" quote. It is the underwritten rate offered by an carrier who has priced a given policy premium (and quote deadline). This rate typically does not change if the policy proposal is accepted by the customer by deadline. Rules governing last minute claims disclosure & underwriting acceptance are specific to each carrier, and are subject to offering terms, conditions, deadlines, and coverage, etc.
Flexible spending accounts (FSAs) enable workers to contribute before-tax amounts to an account that they can then access tax-free to pay various out-of-pocket health-related expenses. Amounts left in the plan at the end of the year in excess of $500 are forfeited—up to $500 only may be rolled over for use in future years.
For the first time in 2013, the federal government imposed a limit on the amount that workers could contribute to their flexible spending accounts. The 2013 limit was $2,500, with that figure being subject to an inflation adjustment for future years. The figure was not adjusted for 2014 but rose to $2,550 in 2015 and remained at that level for 2016. (Source: FL Agent Licensing Exam study material through Web CE)
Fronting can refer to multiple types of reinsurance and insurance. Fronting can be the leasing of an authorized insurance policy form in an individual state. Sponsoring carriers may elect to assume all, part, or none of the risk being assumed by the entity attempting to establish an insurance program. Fronting carriers may, or may not act as reinsurers. A fronted and reinsured assignment can be a program of transferring an existing book ($1+M) of insurance into an existing authorized policy form that creates a less expensive "compliant" insurance alternative to a fully insured premium, and that allows agents to both commission on the sale, and share in profits. Assumption of “some” risk by the sponsoring agency/entity/ company/broker is usually required to assure a true risk partnership and comfort reinsurers.
Fronting and "reinsured" assignments take MANY forms. Where a larger company establishes a (n offshore captive, or on shore "compliant") program to assume and manage their own risk (General Liability, Major Medical, ERISA, Workers Compensation, etc.), the primary purpose is to fund "1st dollar" risk and cede "second dollar" (unpredictable) risk at a cost that can be much less than buying a fully insured coverage to satisfy compliance and/or manage risk. Program managers strive to balance premium savings and liquid-surplus-reserves- funding for known and unknown claims risk. There are many types reinsurance coverages designed to manage unpredictable risk, and/or help improve compliance ratios, and/or solvency risk management. See Finite Reinsurance.
A term defined under ACA meaning an employee working more than 30 hours per week. It is calculated by summing all part time employee hours and dividing by 30hrs to determine a FTE for purposes of ACA employer-employee count being above or below 50 FTE. Under ACA, the number is used to assess ACA tax penalties for employers employing over 50 FTEs. Employers over 50 FTE not providing ACA compliant medical insurance to their employees get fined $2,000 per employee (after the first 30 FTE exemptions).
An employee working more then 30 hours a week. It should be noted that ACA law calculates part time employees working under 30 hours a week – summed and in total to determine if an employer has over 50 full time employee “equivalents” and is subject to either a $2,000 or $3,000 penalty tax for non compliance.
A Fully Disabled Limitation is a condition of a self funded stop loss policy that excludes members not actively at work, and/or who might be in the hospital at time of “disclosure”. This provision is typically waived by the carrier by proper claims declaration.
A term to describe an "eligible" and "Authorized" ( or "admitted") insurance policy approved in a state characterized by a significantly LOWER deductible than a Self Funded Plan. The term fully-insured-rate can be associated with an "admitted" insurance policy form and cover offering premium rebates for favorable claims experience. See Minimum Premium Plans, which are a type of fully insured plan that charges the "fully-underwritten-rate", and rebates premium for favorable claims experience while adding no unfunded risk to the policy holder.
A Grace Period is the number of days past the premium due date the premium will be accepted before canceling the policy for non-payment of premium. A typical grace period is 30 days. Marketplace plans have an ACA mandated 90 day grace period.
An ACA compliant plan allowed that is not ACA compliant (with 10 EHB, etc.)
Under the new CCIIO notice, in states that let grandmothered coverage stay in force, an insurer can renew grandmothered coverage up until Oct. 1, 2018. The grandmothered coverage can stay in effect until Dec. 31, 2018
Failure to comply with ACA means individuals and employers are subject to tax penalties for NOT having ACA compliant coverage.
INDIVIDUAL Plans started before 3/23/10 are allowed to remain in effect until September 2017. Grandfathered plan members do not get fined 2.5% for ACA non compliance. Many Grandfathered plans have materially less coverage than ACA compliant plans. Group plans issued after 1/1/16 are ACA compliant. Grandfathered plans are exempted from ACA mandated changes like unlimited benefits for 10 essential health benefits. Grandfathered plans are typically prohibited from making any changes that increase MOOP. (Source Healthcare.com)
A HHS-CMS department assigned with tracking & communicating alternative (non FFS) medical provider reimbursement contract successes in lowering cost and maximizing evidence based medicine outcomes. “CMS is proud to achieve the 30% target almost a year ahead of schedule. Moreover, true transformation of our health system cannot be done through Medicare alone, and so CMS looks forward to continuing to work with partners across the country to achieve the goals of tying 30% of spending to APMs by the end of 2016 and 50% by the end of 2018 for the entire U.S. health care system.” “The Health Care Payment Learning and Action Network will bring together private payers, providers, employers, state partners, consumer groups, individual consumers, and many others to accelerate the transition to alternative payment models.” “HHS has set a goal (PDF) of tying 30 percent of Medicare fee-for-service payments to quality (PDF) or value through alternative payment models by 2016 and 50 percent by 2018. HHS has also set a goal of tying 85 percent of all Medicare fee-for-service to quality or value by 2016 and 90 percent by 2018.” (source: Health Care Payment Learning and Action Network (LAN))
Section 1561 of the Affordable Care Act requires the Department of Health and Human Services (HHS), in consultation with the Health Information Technology (HIT) Policy Committee and the HIT Standards Committee (the Committees),
Health insurance issuer means an authorized insurance company licensed to sell insurance in a state, and is subject to state law that regulates insurance (within the meaning of section 514(b)(2) of the Employee Retirement Income Security Act (ERISA)). This term does not include a group health plan. (Source Healthcare.com)
Federal Law created to help people keep their insurance between different employers, and ended up adding massive electronic personal information security requirements and (civil and criminal) penalties.
Insurance Portability and Accountability Act of 1996, Pub. L. No. 104-191, as amended,
and its implementing regulations. (source MLN Learning)
A law that sets standards for securing privacy of personal health information, and affording people changing jobs guaranteed insurance without preexisting medical condition exclusion or waiting period.
Health Insurance Portability and Accountability Act of 1996 (HIPAA), which establishes national standards for electronic healthcare transactions and national identifiers for providers, health insurance plans, and employers, and sets forth privacy and security standards for handling health information
Public Law 111–148, Patient Protection and Affordable Care Act, March 23, 2010, 124 Stat. 119,
Minimum Acceptable Risk Standards for Exchanges – Exchange Reference Architecture Supplement i
Version 1.0 August 1, 2012
Centers for Medicare & Medicaid Services Executive Overview
Department of Health and Human Services Final Rule on Exchange Establishment Standards and Other Related Standards under the Affordable Care Act, 45 CFR Parts 155, 156, and 157, March 12, 2012, which establishes privacy and security controls required for processing Exchange applicant information
Internal Revenue Code (IRC), 26 U.S.C. §6103, which establishes criteria for handling Federal Tax Information (FTI)
In addition, numerous other federal and state regulations impact the processes for securing information. For example, the Privacy Act of 1974 places limitations on the collection, disclosure, and use of certain personal information, including PHI. The e-Government Act of 2002 requires federal agencies to conduct privacy impact assessments (PIA) associated with collecting, maintaining, and disseminating PII. The Health Information Technology for Economic and Clinical Health Act of 2009 (HITECH) promotes the adoption and meaningful use of HIT. State statutes, such as the California Senate Bill CSB 1381, protect in varying degrees the privacy of PII and PHI.
There is no integrated, comprehensive approach to security. (Source HHS)
A Health Maintenance Organization (HMO) is a state-designated insurance entity authorized to sell commercial, Medicare or Medicaid health insurance in certain counties. HMO's are known for emphasizing preventative medicine, and paying their doctors and hospitals a fixed dollar “capitation” for each member assigned to a provider group. An HMO is typically separated from a PPO or Indemnity Health Insurance by two major things: a capitated primary care physician (PCP), and required referral from a PCP for specialty physician access.
HRA accounts are used to assist employees in paying typical deductible, co insurance and other eligible out-of-pocket medical expenses during a calendar plan year. These funds are deposited by employers and/or employees each year Pretax, and can be spent on eligible medical costs by typically using an assigned Debit card. Total annual deposits are regulated and limited per calendar year. Unlike Section 125 plans, unused HRA account balances do not roll over to a new policy year, and therefore are referred to as “use it or lose it”. See Section 125 plans. . Tax considerations and regulations are many, and must be confirmed with Licensed CPA’s or attorneys.
A tax exempt account used to fund medical expenses (your deductible) that can be funded by an: individual, employee, and / or employer. These accounts must pair with higher deductible plans ($1,300 single and $2,600 family for 2017) eligible under IRS quidelines.
Health Savings Accounts
A health savings account (HSA) is a special tax-exempt account an individual owns and establishes pretaxed funds to pay for qualified medical expenses. HSAs are used in conjunction with high-deductible health plans (HDHPs) offered by many insurance companies. The maximum amount that may be contributed to an HSA is set by law and subject to change each year.
Maximum HSA Contribution Limit 2017 2016
Single Coverage Family Coverage Single Coverage Family Coverage
Maximum HSA Contribution Limit $3,400 $6,750 $3,350 $6,750
Minimum HDHP Deductible $1,300 $2,600 $1,300 $2,600
Maximum HDHP Out-of-Pocket Limit $6,550 $13,100 $6,550 $13,100
(Source: FL Agent Licensing Exam study material through Web CE)
A contentious one to five star quality rating published on 3662 hospitals by Centers for Medicare and Medicaid Services (CMS) being released later in 2016. Teaching hospitals and hospitals dealing with the poor typically rank lower because of higher (previously untreated) comorbidity care.
A medical report from a qualified medical professional detailing percentage of work related injury and claim caused by a work related injury, and potentially insured by workers compensation insurance. See EMA & MCC & DWC25 form
An Independent Practice Association (IPA) is typically a group of physicians who organize themselves into a contracting entity to care for an HMO's and PPO's members. It can also be a licensed HMO owned by its member physicians.
Under the Affordable Care Act, the individual mandate requires individuals to have health care coverage or pay a tax penalty.
Information for 2016 and 2017
Open enrollment in the health insurance marketplace for 2017 begins on November 1, 2016, and runs through January 31, 2017. The penalty for not having coverage in 2016 is the greater of 2.5 percent of income in excess of the filing threshold, or $695 per adult ($347.50 for a child under 18) up to a maximum of $2,085. For 2017 and beyond, the percentage penalty will remain at 2.5 percent of income, but the flat fee will be adjusted for inflation. Source: Florida Agent Licensing Exam course.
Tax Credit applied against monthly medical insurance premiums available to people earning between 133% - 400% of FPL.
In states where Medicaid Expansion was adopted, tax credits are available from 138% - 400%. Practically speaking, the tax credit is meaningful (big enough to matter) under 300% FPL.
ISO (Insurance Services Office) and AAIS (American Association of Insurance Services) policy forms" Insurers deviate from industry standards and react to changing loss scenarios, underwriting challenges, legislative changes and court decisions before ISO or AAIS my change or accept such deviations in promulgated examples of policy forms. Compliance gets complicated.
Integrated Delivery Systems (IDS) are physician, hospital and insurance company joint ventures which are authorized to sell health insurance in a state. Sometimes simple unorganized Physician and Hospital groups refer to themselves as integrated despite their inability to coordinate care, manage their physicians or reduce cost.
An IRC § 162 bonus plan is a nonqualified retirement type of plan where an employer pays a bonus to a participating executive and directs the bonus toward payment of premiums on a life insurance policy owned by and covering the executive. Monies used to pay the premium are taxed prior to paying the premiums, and the death benefits are generally recovered tax free. Cash value is instantly available - generally without tax as well (through loans on the policy). See SERP
A commercial Group (employer) medical plan priced at full premium, but that refunds back unused premiums based on ACTUAL claims being below the "fully funded" rates. It is a single trigger, upside only "risk" contract. Employer is not at risk for any claims above the fully funded, paid and fixed monthly premium charge.
The length of time a person is expected to live. In Life Settlements, it is the length of time in months an insured person is expected to live. LE's are commonly estimated by physicians and entities involved with buying and selling life insurance policies. These estimations help entities purchasing life settlements budget expected premium cost through policy execution. See life settlements.
There are three to four basic types of life insurance: Term, Universal Life, Whole Life, and Variable life. Only Variable life policies can put cash values at risk to market crashes. Policies goals are typically designed to maximize or balance death benefits, debt relief and/or retirement distributions. Universal Life, Indexed Universal Life and Whole life can guarantee Principal safety & accumulated interest being locked-in MONTHLY. UL, IUL and WL also allow for tax deferred loans up to about 95% of their surrender value. Loans are available without penalty prior to age 59.5, and are pre-planned to remain IRS compliant and generally enjoy tax preferred spending (taken as loans againstt the Surrender Value). All loans are repaid after death with tax free death benefits while the policy remains IRS compliant. Because policy loans do NOT reduce Cash Value, the insured enjoys spending up to his policy Surrender Value in retirement, while still earning interest on the same values spent (taken as loans) for life. IUL, UL and Whole life never place an insured's cash value in the market, and have historically outperformed indexed investments exposed to market-crash risk. Our opinion is these policies generally offer exceptional "tax preferred" retirement benefits without market crash risk, WITH interest guarantees.
A term referring to the business of buying and selling life insurance policies. It can also be used interchangeably with the process of determining a market value for a given life insurance policy, or portfolio of policies being purchased by investors.
A policy that insures Activities of Daily Life that are considered “custodial, and excluded under typical medical insurance policies.
An insurance policy triggered by a member’s inability to perform 2 or more activities of daily life (ADL). ADL’s can include: bathing, shopping, transporting, toileting, check writing, cleaning, cooking, housework, banking, etc. These are explicitly defined in long term care policies. Long term care is considered custodial and not acute care, and is not insured by most major medical or Medicare plans beyond the period defined in the policy for rehabilitation. Coverage is generally of two types: lump sum to spend as needed, or lump budget doled out by a daily limit schedule (i.e. $250 per day up to $150,000 limit).
A multiple or factor used to assign good or bad experience when rating premiums typically used in rating workers compensation, premium.
NCCI manages major responsibility for overseeing application of retrospective rating. Application of LCF and retrospective ratings can become central to charged premium disputes.
A term used to determine potential compensability (eligibility) of a medical claim insured under workers compensation. The term addresses a determination of a medical claim being 51% or more caused by the job related injury event, and not from an uninsured preexisting medical condition.
IME's and EMA's can be used to determine if treatment is appropriate.
See IME, EMA, SA, MMI. These determinations are subject to contentious debate.
A Managing General Underwriter (MGU), sometimes called an MGA -- Managing General Agent, is an independent facility authorized by a carrier to rate, bind and issue policies. MGU's are legally bound to represent the best interests of their sponsoring carrier. They typically share in contingency fees and overrides on profitable business. MiniMed or Limited Medical Insurance Plans
ACA promulgated Federal Government position as umpire regarding Evidence Based Medicine (EBM) to certify efficacy of care standards for given alleged treatments. Carriers and self funded employers are charged a tax each year to fund NQOI management.
A schedule of rates typically created by actuaries that are filed and approved by state as required by each state. Underwriters use these "maximized" rating schedule(s) to rate individual opportunities for insurance. Sometimes underwriters refer to the "discounted" and underwritten rate at Book Rate". Sometimes underwriters refer to underwritten rate (s) as "Book to Manual" (BTM).
Term used in workers compensation to represent an injured worker's maximum recovery/medical state and expence for purposes of settling the medical claim payout. Generally, the file is closed after final medical bills are paid.
The maximum limit an insured pays before their medical plan insured 100% for eligible medical care. Deductibles, Co insurance and copay amounts typically attribute to MOOP. ACA regulations set MOOP each year. See Balance Billing.
This term is used to convey the maximum reimbursement of hospital charges a policy holder will recover each day. It is a figure compared to the average cost per day derived by dividing the total charges by the length of stay. Almost all HMO reinsurance and PEL policies have this provision that can tend to reduce coverage.
ACA "Meaningful Access" Time Line
September 13, 2016
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Section 1557 of the Affordable Care Act (ACA) applies to protected classes of individuals whose health coverage may not be denied, cancelled, limited or refused on the basis of race, color, national origin, sex, age, or disability and it builds on other federal civil rights laws to do so. The rule was effective July 18, 2016, with a couple of exceptions.
•First, provisions that require changes in health insurance or group health benefits design are applicable on the first day of the plan or policy year beginning on or after January 1, 2017.
•Second, portions of the law that address meaningful access for persons with limited English proficiency are effective beginning on Oct. 16, 2016.
The law is broad and will affect health insurance issuers and employers that receive federal financial assistance from Health and Human Services (HHS). One part of the law provides expanded protection for transgender individuals, which we covered in the July Broker Connection. The other parts cover meaningful access regulations that address the following requirements.
Access to Language Assistance
Covered entities must provide language assistance services free of charge, and the services must be accurate, timely, and protect the privacy of an individual with limited English Proficiency. Language assistance includes interpretation (oral) and translation (written). Covered entities must offer a qualified interpreter to an individual with limited English proficiency free of charge and use a qualified translator when translating written content in paper or electronic forms.
Access to Auxiliary Aids and Services
The Final Rule also requires covered entities to make communications with individuals with disabilities as effective as communications with others, including the use of appropriate auxiliary aids and services to persons with impaired sensory, manual, or speaking skills.
Assess to Electronic and Information Technology
Covered entities must ensure their health programs or activities provided through electronic and information technology are accessible to individuals with disabilities. This includes technology used by individuals on portals and mobile phone applications. The disabilities contemplated in the final rule include vision, hearing or sensory impairments, such as a person who in unable to use a mouse or keyboard.
Distribution of Nondiscrimination Notice and Taglines
Covered entities must take appropriate initial and continuing steps to notify beneficiaries, enrollees, applicants, and members of the public:
1.That the covered entity does not discriminate on the basis of race, color, national origin, sex, age, or disability in its health programs or activities;
2.How to request assistance in another language or format and that these services are free of charge;
3.How to file a discrimination complaint and get assistance;
4.How to file a discrimination complaint with OCR.
This “non-discrimination notice” is required to be included for all significant communications sent by the covered entity whether written, electronic or both.
Covered entities must also post the non-discrimination notice and taglines to alert individuals that language assistance services are available.
•The regulations uses a state threshold, requiring covered entities, generally, to post taglines in at least the top 15 non-English languages spoken in the state in which the entity is located or does business.
•Covered entities that serve individuals in more than one state can aggregate the top languages to determine the top 15, or for small sized communications such as postcards or tri-fold brochures, to the top two languages. Languages are determined by census data.
A covered entity must submit an assurance on a form specified by the Director of the Office of Civil Rights of HHS that its health programs and activities will be operated in compliance with Section 1557.
Access to Buildings and Facilities
Each facility or part of a facility in which health programs or activities are conducted that is constructed or altered by or on behalf of, or for the use of, a recipient, must comply with the 2010 Americans with Disabilities Act (ADA) standards for accessible design if the construction or alteration was commenced on or after July 18, 2016. There are exceptions related to facilities that depend on the date of building construction and compliance with ADA standards. Requirements are limited to the public facing areas of entities.
Oversight and Grievance Procedures
Each covered entity that employs 15 or more persons has to:
•Designate at least one employee to coordinate its efforts to comply with and carry out its responsibilities, including the investigation of any grievance alleging noncompliance with Section 1557.
•Adopt grievance procedures that incorporate appropriate due process standards that provide for the prompt and equitable resolution of grievances.
Applicability to Fully Insured and Self-Funded Employers
Coverage changes will apply to fully insured clients insured by covered entities. Self-funded clients should consult their own counsel to determine what is required or what changes they may wish to make beyond those required under Section 1557.
Notice and taglines are complete and are being put onto required documents and website.
UnitedHealthcare facilities comply with the regulation as well as earlier regulations governed under the ADA. A UnitedHealthcare Civil Rights coordinator is in place as well as a grievance policy based on the model notice in the law.
HHS has established a website with links to fact sheets and FAQs on Nondiscrimination Section 1557. (Source: United Healthcare Broker advisory 2016)
A state health insurance program for people earning under 100% of FPL, and eligible for Medicaid. Medicaid is different in each state. Medicaid can have about 15 categories of eligible people, and coverage. Typically, the federal government gives 50% of a state’s Medicaid budget. Under ACA, Medicaid eligibility was expanded from 100% to 133% of FPL for eligibility in states electing to expand Medicaid eligibility. 13 states elected not to expand Medicaid under ACA
A voluntary state expansion of Medicaid eligibility offered under ACA by the Federal Government for three years. The provision allows poor people access to free or less expensive Medicaid insurance by increasing income cut-off eligibility from 100% to 138% of FPL.
A program that the Supreme Court allowed individual (13) states to opt out, despite the federal government funding the first three years of added cost. Under the Affordable Care Act, states have the option to expand Medicaid eligibility to cover non-elderly, non-pregnant adults ages 19-64 with a household MAGI at or below 138% of the FPL. This is known as "Medicaid expansion."
However, some states have chosen not to expand Medicaid eligibility. Regardless of whether a state chooses to expand its Medicaid eligibility, all state Medicaid programs:
Use MAGI as the income methodology for the majority of applicants (generally, all non-elderly, non- disabled populations)
Do not consider assets in determining eligibility for individuals whose financial eligibility is based on MAGI
Streamline income-based rules, systems, and verification procedures (Source Healthcare.com)
Medical Loss Ratio is typically defined as Total Premiums/Total claims. It is also a the ACA legislated percentage a carrier must pay in claims to avoid mandatory premium refunds to their insured customers. ACA sets MLR for Individual, and Medicare Advantage at 80%, and 85% for Employer Group medical insurance.
A statutorily regulated account individuals can deposit pre-tax income into that is designated to pay eligible medical expenses not insured under a persons medical insurance policy. Ex. Deductible(s), co insurance, copays & Maximum out of pocket charges.
A bipartisan billed signed in 2015 that stopped the automatic 21% discount of Medicare reimbursements, and replaced it with value based reimbursements. See QPP
see: http://www.squirepattonboggs.com/~/media/files/insights/publications/2017/02/ahla-executive-summary-implementing-the-medicare-access-and-chip-reauthorization-act-of-2015-the-merit-based-incentive-program-and-alternative-payment-models/macra_mb.pdf?spMailingID=53371093&spUserID=MTQ2NTQ3NjkzNTYS1&spJobID=1101239756&spReportId=MTEwMTIzOTc1NgS2 http://www.usnews.com/news/articles/2017-01-25/health-groups-urge-trump-congress-to-maintain-push-for-value-based-care
HMO and PPO plans offered by commercial carriers, but paid for by the HHS to people over 65 years of age. Unlike Medicare Supplemental plans, MA plans mandate in-network provider access to reduce or eliminate out of pocket costs. See MAPB
A federal entitlement to eligible Medicare beneficiaries that insures up to 150 days of acute-inpatient-hospital care (plus 20 days), and also outpatient hospital care. Up to 100 days of Skilled nursing facility are covered for qualifying care. Medicare Part A does not insure Long term (custodial ) Care.
A federal entitlement insurance available to people over 65 years of age who are eligible for Medicare Part A, and that covers eligible physician charges. Any person wishing to elect a low cost Medicare Advantage (HMO or PPO) must first enroll in part B, and pay the additional premium each month - in addition to a small charge for the HMO or PPO. Pharmacy plans may also need to be purchased at additional charge as well, depending on if the carrier includes the MA-PD in the (HMO) plan or not.
Legislation enacted to offer HMO & PPO options to Medicare eligible people. The law also details PSO's or Provider Services Organizations designed to engage physicians into deliver care within several types of reimbursement scenarios.
Medicare Part D
Medicare Part D offers optional prescription drug benefits for those entitled to Medicare Part A and Part B. Eligible individuals can obtain Medicare Part D coverage from either a stand-alone prescription drug plan or through Medicare Advantage (Part C) plans that include prescription drug coverage.
In contexts to workers compensation claim and the total estimated medical expense to establish maxium medical improvement (MMI), of a Medicare eligible injured worker (IW), it is the amount NOT paid directly to the worker available to pay medical bills. This is done to avoid workers pocketing the cash, and not paying the medical providers, exposing Medicare to the liability.
A contract offered by the federal government that shares savings from the successful management of Medicare or Medicaid members with physicians and or hospitals who are able to manage care under the expected budget for that population. These contracts are typically over a three year term. See ACO contract. See: https://www.cms.gov/Medicare/Medicare-Fee-for-Service-Payment/sharedsavingsprogram/index.html
The successor to meaningful use, known as Advancing Care Information.
Eligible professionals (EPs) will no longer have to meet every requirement, as they do under the current program, he emphasized. The proposal allows physicians and other EPs to get 50% credit just for reporting on the measures, which no longer include clinical decision support or computerized physician order entry. The other 50% of the score will depend on the EPs' performance on those measures, and clinicians can choose the metrics that are most meaningful to their practices. The number of measures has been reduced to 11 from the current 18.
The three priorities for this program are improved interoperability to facilitate health information exchange, increased flexibility, and "user-friendly" technology, according to a blog post by Slavitt and Karen DeSalvo, MD, national coordinator for health information technology (IT) and assistant secretary of health.
Slavitt and Dr DeSalvo both emphasized that the government wants developers to use open application programming interfaces that the Office of the National Coordinator for Health IT will soon publish. One of the goals for Advancing Care Information is to provide the means for patients to access their health information through such interfaces. At the press conference, Dr DeSalvo said application programming interfaces would also help developers meet providers' expectations for more usable health IT systems.
Meanwhile, EPs need EHRs that are capable of meeting the criteria for Advancing Care Information. Dr DeSalvo notes that the proposed rule is "aligned" with the 2015 edition of certified EHR technology, but because that version is not mandated until 2018, the new criteria were tweaked to fit the 2014 versions of EHRs most providers are using, said Kate Goodrich, MD, director of the Centers for Medicare & Medicaid Services Center for Clinical Standards and Quality. EPs can use the 2014 EHRs until 2018, she said.
Media reports state that the reporting period for Advancing Care Information will be the full calendar year, although the subject was not discussed at the news conference
(Source: Medscape) https://qpp.cms.gov/docs/CMS-5517-FC.pdf
MiniMed is non ACA compliant insurance offering a limited medical benefit typically under $50,000 a year. It typically limits hospital, pharmacy, surgical and physician charges to a maximum amount or per diem. Vision, Mental, Dental and Pharmacy benefits may be included within the insured benefit schedule, or as a discounted network access benefit or feature. The program is generally purchased by groups unable to afford traditional major medical insurance.
MSR is the percentage of claims saved under an ACO Shared Savings contract period (typically three years), and is used to convey how efficient and effective medical care was delivered under budget, MSR denotes a Shared Savings provider bonus. See MSSP.
A modified endowment contract is a life insurance contract entered into on or after June 21, 1988, that fails to meet the seven-pay test. Meaning the cumulative premiums paid into the policy during the first seven years exceed the amount needed to produce a paid-up policy based on seven net level annual premiums.
If the policy is considered a modified endowment contract, FIFO tax treatment is forfeited, and last in, first out (LIFO) tax treatment takes its place—causing withdrawals to be taxed on an income-first basis.
Meaning that if you plan to borrow funds from life insurance surrender values in retirement, any loans must remain in compliance with what IRS considers legitimate life insurance contracts. IRS uses two primary tests to determine if a policy is, or is not life insurance.
A MEWA is a Multiple Employer Welfare Association. It is a protected class of health insurance regulated by the Department of Labor under ERISA that provides various exemption from state insurance regulation. Practically speaking, most states despise MEWA’s and will legally challenge them regardless of ERISA standing. Of the protected classes ERISA legislation governs: (Associations, Trusts, Self funded Employers and Unions), MEWAs are rare. The over-reaching purpose of self funding any of these organizations is to reduce the cost of providing insurance benefits to employees. Self funded MEWAs offer many small employers a group structure to command greater buying power. But, because each member employer is small, they may not be capitalized to sustain unexpected or unpredictable deductible losses which is one reason states dislike MEWA’s. A Fully Insured Health Plan MEWA may not be federally required to possess a state issued Certificate of Authority. However there is long history of many states aggressively moving to eliminate them unless the MEWA’s reinsurance meets “their” specific coverage standard. Material legal assistance is required to set these up and maintain them successfully within state guidelines despite ERISA exemption.
The purchase of Specific and Aggregate reinsurance is usually required to transfer the majority of risk to an approved insurance carrier. Historically, placement of MEWA stop loss is the hardest part of the program
Multiple Loss Medical Reinsurance is a feature found in high deductible employer stop loss policies. It provides additional coverage for medical charges incurred from the same trauma, or within a 50-mile radius, or within a period of 7 days. I.e. On a traditional $500,000 specific policy, the deductible drops from $500,000 to $10,000, and pays a benefit up to $490,000. Coverage is defined in terms of a maximum, minimum and 3 life warrants.
A term typically related to auto insurance that pays the owner of the policy for damages to their vehicle or for medical expenses caused in an accident without assignment of fault. Limits are statutorily assigned at $10,000 per person and $20,000 per accident, and applied to both medical and property losses. These limits pay Primary, and additional limits (if purchased) pay secondarily.
An agency funded by carriers responsible for setting employee Class Codes, and applicable insurance rates charged on payroll.
"• NCCI, which serves as the filing agency and rating organization for workers compensation insurance in the majority of states, promulgates a standard workers compensation and employers liability insurance policy (WC 00 00 00 C). The 2015 edition of that policy is in used in all 46 states (and the District of Columbia) that allow private insurers to write workers compensation insurance. (The other four states require all workers compensation insurance to be purchased from a monopolistic state fund.) Most states allow insurers to file their own forms, although few insurers choose to do so. Consequently, almost all workers compensation policies issued in the United States are written on the 2015 NCCI form." (Source Web CE for Florida Agent licensing exam)
The NCCI is an association funded primarily by insurance companies, that compiles and distributes workers compensation rating, underwriting guidelines and job-typed "Classification" codes used to calculate workers compensation premiums in non-monopolistic states. NCCI collects loss information and calculates "advisory" rates that many Workers Compensation carriers use to bill employers.
Because carriers also calculate their own underwritten rates, differences between NCCI calculated losses and carrier calculated losses cause disputes.
Reference materials, such as the Basic Manual, Experience Rating Manual, and Scopes for Basic Manual Classifications published by NCCI, and IRMI’s Classification Cross-Reference (i.e. conversions) guide accuracy in determining the basis of premium, the proper classification(s), and other relevant pricing factors.
The Next Generation ACO Model is a healthcare delivery and payment model created by the CMS Innovation Center. The goal of the Next Generation ACO Model is to test whether strong financial incentives for ACOs can improve health outcomes and lower expenditures for Original Medicare fee-for-service beneficiaries. Additionally, it allows participating providers to assume higher levels of financial risk and reward than are available under the Shared Savings Program or were offered in the Pioneer ACO Model. The Next Generation ACO Model previously accepted organizations into the initiative for January 2016 and 2017 start dates. As of January 2017, there are a total of 45 Next Generation ACOs all over the nation—from Los Angeles, California to Boston, Massachusetts. (source CMS) https://innovation.cms.gov/initiatives/Next-Generation-ACO-Model/
A type of medical insurance plan offering access to specialty physician care without the requirement of a primary care physician referral. Plans requiring referral from a primary care provider to access specialty care are called Gatekeeper plans.
An informal term used to describe a licensed or Certificate holding “admitted” carrier in a particular state or country. These carriers are both eligible and authorized in states. Surplus lines carriers are eligible, but not authorized to conduct insurance business in a state.
The Patient Protection Affordable Care Act is referred to as the Affordable Care Act/ACA/PPACA. The ACA (Affordable Care Act) is a 2310 page law encompassing all medical care in the US, but with very limited application to Veterans affairs, approved Limited Medical Plans and underwritten Medicare Supplemental plans. ACA compliant plans mandate: 10 minimum essential benefits (MEB) without annual benefit limits, tax credits for individuals earning below 400% of Federal Poverty Level (FPL), and Cost Sharing for people earning between 100%-250% of FPL. Cost sharing lowers deductibles and max-out-of- pocket costs, and limits total annual health spend from (about) 2% to a maximum of 9.66%. Small employers are now offered tax credited plans through SHOP. Similar to Medicare Advantage plans, Individual and Small Group Insurance is provided by commercial carriers, not the government. https://s3.amazonaws.com/public-inspection.federalregister.gov/2017-03027.pdf?utm_campaign=hcgov_ab&utm_content=english&utm_medium=email&utm_source=govdelivery
An out of pocket cost to an insured member admitted to a hospital for an inpatient stay. These costs are typically in addition to annual plan deductibles, and are subject to maximum out of pocket maximum stated in the policy.
Per Diem Contracts are contracts reimbursing hospitals a flat amount per day for specified hospital services. Per Diems are common stop loss and reinsurance coverage limitations consisting of average daily maximum allowable amount per day. Per diem contracts can also be vender related pricing sold to various self funded employers or carriers offering insurance in an area.
A Per Diem Maximum is typically an in-patient hospital coverage in a stop loss or reinsurance contract limiting the carrier's exposure per day for eligible charges. It is generally required in all Provider Excess and HMO reinsurance policies. Special care should be taken to understand how large claims incurred within a small number of days are affected. Expressed as either a Maximum Daily Limit or Average Maximum Daily Limit, this coverage usually reduces the total eligible hospital charges reimbursable in the policy. The Average Daily Maximum Limit is richer coverage and should be sought.
A complex law governing auto insurance liability, and providing PRIMARY coverage response for property or medical claims without assignment of fault. I.e. each party gets paid by his own policy up to $10,000 per person, and $20,000 per accident. i.e. "No-Fault insurance". Legal remedy may also be available where damage are severe and/or excess of the $10,000 per person limit. No-Fault insurance is designed to reduce court congestion on low dollar claims.
Personal Information as defined by HHS within non FFM agency contract: APTC percentage and amount applied
Auto disenrollment information
Applicant Telephone number
Applicant Social Security Number
Applicant spoken and written language preference
Applicant Medicaid Eligibility indicator, start and end dates
Applicant CHIP eligibility indicator, start and end dates
Applicant QHP eligibility indicator, start and end dates
Applicant APTC percentage and amount applied eligibility indicator, start and end dates
Applicant household income
Applicant Maximum APTC amount
Applicant CSR eligibility indicator, start and end dates
Applicant CSR level
Applicant QHP eligibility status change
Applicant APTC eligibility status change
Applicant CSR eligibility status change
Applicant Initial or Annual Open Enrollment Indicator, start and end dates
Applicant Special Enrollment Period eligibility indicator and reason code
Contact Telephone number
Contact spoken and written language preference
Enrollment group history (past six months)
Enrollment type period
FFE Applicant ID
FFE Member ID
Issuer Member ID
Net premium amount
Premium Amount, start and end dates
Credit or Debit Card Number, Name on Card
Checking account and routing number
Special enrollment period reason
Subscriber Indicator and relationship to subscriber
Tobacco use indicator and last date of tobacco use
American Indian/Alaska Native status and name of tribe
Requesting financial assistance
Applicant/Employee/dependent sex name
Subscriber indicator and relationship to subscriber
Total individual responsibility amount
See HIPPA for uncertainty.
A Pharmacy Benefit Manager is a company specializing in the administration of commercial, Medicare, Medicaid and/or Workers Compensation pharmacy benefits. A PBM may also be a specialized entity in high dollar Rx such as factor agents for hemophiliacs, cancer infusion, dietary feeding, and an array of infusion therapies.
CMS downloadable database for individual eligible professionals (EPs) - means everyone does not have access to it.
In addition to the recently released quality data, the Physician Compare Downloadable Database also includes demographic information and Medicare quality program participation for individual EPs, which is updated every two weeks. https://data.medicare.gov/data/physician-compare
Physician Hospital Organizations (PHO) are physician and hospital joint ventures typically organized to attract members from HMOs and self-insured employers. Many PHO’s become employed doctor practices acquired by hospitals or larger multispecialty groups.
A Point Of Service (POS) Plan is a program of commercial or Medicare health insurance which offers the customer two options of how they can receive care-in-network and/or out-of- network plan care. In-plan care allows members to save 30-40 percent of out-of-pocket expenses when they receive care from a provider within the panel of contracted providers. Point of service plans are designed to provide members greater choice of medical provider selection. POS plans typically insure out of network care, and are not the same as HMO, EPO, or “National Network” offered plans.
A term with roots in disease management (DM) related historically to managing hospital admissions and readmissions from the same diagnosis or DRG. PHM can also refer to management of health groups of people& keeping them healthy.
Portfolio Aggregate Reinsurance is coverage that responds when the expected claims value on a book or "portfolio" of coverage exceeds a specified percentage above the Expected claim value, typically between15%-25%. It is a layer of protection to the primary insurer for a catastrophic year on a specific block of business intended to cap the maximum probable loss on a book of business. Coverage typically responds at 115%-125% of the expected claims value.
A statistical method used to analyze data sets of targeted high cost medical procedures and/or conditions, and whose goal is to identify and treat conditions prior to onset of severe illness attack. Many "population based management" (i.e. Disease Management) approaches have been used over the years - with many falling short of accurately producing cost savings or better medical outcomes.
A now defunct GOVERNMENT plan that was created in the first days of ACA that allowed sick people to enroll in insurance prior to federal exchange and state marketplace enrollment availability. The plan was eliminated with the Federal marketplace was established. Key is its cost data derived whish is cited with ambiguous new Trump ACA replacement initiatives centered on giving block grants to states to prevent the un-insurability problem (at any price of premium) public protections fixed by ACA passage. ($32,108 PMPY plus administrative/sales costs per CCIIO in 2013)
Prepaid Health Plans (PHP) sometimes referred to as MPHP's (Medicaid Prepaid Health Plans) or LHSO's (Limited Health Services Organizations), are state-approved organizations which accept a capitation for services rendered to Medicaid members. An LHSO can be just about any special state-authorized entity approved to insure a limited risk, i.e., psychiatry HMO, dental HMO, etc. It is possible to include commercial and or Medicare lives as permitted by law/regulation.
A corporation that derives its income from providing traditional Human Resource services (i.e., employee benefits) to a client employer on an outsourced basis. The PEO corporation may be the same employer, and lease the employees back to itself. The PEO can be a completely separate corporation selling their outsourced HR services to multiple employers in the area too. Less expensive liability and health insurance are typically attributes of "leasing" one's own employees. If the health insurance is to be provided on a partially self funded basis, either an ERISA or MEWA type plan is typically used.
Programs of All-Inclusive Care for the Elderly (PACE) for new populations, including individuals with physical disabilities, under the authority provided by the PACE Innovation Act. The PACE Innovation Act of 2015 (PIA) provides authority to test application of PACE-like models for additional populations, including populations under the age of 55 and those who do not qualify for a nursing home level of care, under Section 1115A of the Social Security Act.
A Provider Maintenance Organization is a state or federally authorized physician and/or hospital owned entity that owns an HMO. These entities typically enjoy a three year period of not having to come up with the minimum state mandated solvency capitalization required of traditionally licensed HMO's. They may also enjoy a start up period requiring lower reserve requirements (i.e. In GA a PHSCC, Federally a PSO).
A Provider Sponsored Organization (PSO) is a federal designation under Medicare Part C - given to physician and/or hospital groups which accept capitation for services rendered to enrolled Medicare members.
The public option is an ongoing progressive movement to create a government health plan that competes directly with commercially provided plans, and that would be available to both individuals and businesses. Medical Provider Reimbursements have been proposed at 100% of Medicare allowable causing little physician support.
The Affordable Care Act reorganizes, amends, and adds to the provisions of title XXVII
of the Public Health Service Act (PHS Act) relating to group health plans and health insurance
issuers in the group and individual markets.
Federal law H.R. 34, the 21st Century Cures law - allowing (qualified small) employers to give individual employees up to $4,950 (pretax - like a section 125 plan HRA group medical and/or ancillary benefit employer paid funding) in reimbursement for INDIVIDUAL (not Group medical) major medical premiums for 2017, and up to $10,000 in reimbursement for family coverage premiums. The intent of the law is to allow employers provide pretax funds to employees to buy INDIVIDUAL insurance on the Marketplace. The problem is that Group plans allow EMPLOYEE enrollment (without Preexisting medical condition exclusion) within 60 days of employee eligibility, and the Marketplace Rules apply to INDIVIDUALS applying during OEP and SEP. https://www.congress.gov/bill/114th-congress/house-bill/34
On April 27, 2016, CMS released a notice of proposed rulemaking (NPRM) for MACRA. MACRA makes three important changes to how Medicare pays those who give care to Medicare beneficiaries. These changes create the Quality Payment Program (QPP), which:
1. Ends the Sustainable Growth Rate (SGR) formula for determining Medicare payments for health care providers’ services.
2. Creates a new framework for rewarding health care providers for giving better care not just more care.
3. Combines our existing quality reporting programs into one new system.
These proposed changes replace a patchwork system of Medicare reporting programs with a flexible system that allows participants to choose from two paths that link quality to payments: the Merit-Based Incentive Payment System (MIPS) and Advanced Alternative Payment Models (APMs). Source Healthcare.com
Plans for the Quality Payment Program in 2017: Pick Your Pace by Andy Slavitt, Acting CMS Administrator
As the baby boom generation ages, 10,000 people enter the Medicare program each day. Facing that demand, it is essential that Medicare continues to support physicians in delivering high-quality patient care. This includes increasing its focus on patient outcomes and reducing the obstacles that make it harder for physicians to practice good care.
The bipartisan Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) offers the opportunity to advance these goals and put Medicare on surer footing. Among other policies, it repeals the Sustainable Growth Rate formula and its annual payment cliffs, streamlines the existing patchwork of Medicare reporting programs, and provides opportunities for physicians and other clinicians to earn more by focusing on quality patient care. We are referring to these provisions of MACRA collectively as the Quality Payment Program.
We received feedback on our April proposal for implementing the Quality Payment Program, both in writing and as we talked to thousands of physicians and other clinicians across the country. Universally, the clinician community wants a system that begins and ends with what's right for the patient. We heard from physicians and other clinicians on how technology can help with patient care and how excessive reporting can distract from patient care; how new programs like medical homes can be encouraged; and the unique issues facing small and rural non-hospital-based physicians. We will address these areas and the many other comments we received when we release the final rule by November 1, 2016.
But, with the Quality Payment Program set to begin on January 1, 2017, we wanted to share our plans for the timing of reporting for the first year of the program. In recognition of the wide diversity of physician practices, we intend for the Quality Payment Program to allow physicians to pick their pace of participation for the first performance period that begins January 1, 2017. During 2017, eligible physicians and other clinicians will have multiple options for participation. Choosing one of these options would ensure you do not receive a negative payment adjustment in 2019. These options and other supporting details will be described fully in the final rule.
First Option: Test the Quality Payment Program.
With this option, as long as you submit some data to the Quality Payment Program, including data from after January 1, 2017, you will avoid a negative payment adjustment. This first option is designed to ensure that your system is working and that you are prepared for broader participation in 2018 and 2019 as you learn more.
Second Option: Participate for part of the calendar year.
You may choose to submit Quality Payment Program information for a reduced number of days. This means your first performance period could begin later than January 1, 2017 and your practice could still qualify for a small positive payment adjustment. For example, if you submit information for part of the calendar year for quality measures, how your practice uses technology, and what improvement activities your practice is undertaking, you could qualify for a small positive payment adjustment. You could select from the list of quality measures and improvement activities available under the Quality Payment Program.
Third Option: Participate for the full calendar year.
For practices that are ready to go on January 1, 2017, you may choose to submit Quality Payment Program information for a full calendar year. This means your first performance period would begin on January 1, 2017. For example, if you submit information for the entire year on quality measures, how your practice uses technology, and what improvement activities your practice is undertaking, you could qualify for a modest positive payment adjustment. We've seen physician practices of all sizes successfully submit a full year’s quality data, and expect many will be ready to do so.
Fourth Option: Participate in an Advanced Alternative Payment Model in 2017.
Instead of reporting quality data and other information, the law allows you to participate in the Quality Payment Program by joining an Advanced Alternative Payment Model, such as Medicare Shared Savings Track 2 or 3 in 2017. If you receive enough of your Medicare payments or see enough of your Medicare patients through the Advanced Alternative Payment Model in 2017, then you would qualify for a 5 percent incentive payment in 2019.
However, you choose to participate in 2017, we will have resources available to assist you and walk you through what needs to be done. And however you choose to participate, your feedback will be invaluable to building this program for the long term to achieve outcomes that matter to your patients.
We appreciate the sincere and constructive participation in the feedback process to date and look forward to advancing step-by-step in that same spirit. We look forward to releasing the final details about the program this fall. Most importantly, we look forward to further engagement with physicians and other clinicians toward our shared goal of the highest quality of care and best outcomes for patients. (source: CMS advisory)
HHS and IRS mandated medical cost, and detail reporting aka Patient Centered Outcomes Research (PCORI). The $2.17 Tax per enrollee for this federal “umpire on efficacy of care” are charged to Carriers and self funded employers, and set to expire Sept 30,2019.
Quota Share reinsurance sometimes referred to as "Proportional" or "Pro Rata" is coverage providing a specified percentage of premiums, expenses and claims losses between the primary insurer (ceding company) and the Reinsurer. Risk transfer can assume up to 100% of the total premium risk. It is typically a first dollar coverage, where the reinsurer receives the same percentage of premium as it funds claims.
A term used to convey a companies financial strength and or reputation for paying claims on times. i.e. Standard and Poors, Moodies, AM Best, Fitch, D&B, etc. For insurance, AM best specifically includes reputation for paying claims promptly.
Reasonable and Customary charges are sometimes referred to as Usual Customary and Reasonable charges (UCR). R&C is not a fee schedule with precise amounts by medical procedure, device, service or hospital charge. Determining R&C can be guided by reasonable location, and relative comparison to various statutory, and/or regulatory fee schedules used to establish reimbursement for purposes of insurance subject to the policy language, policy type, and general convention(s). Reasonable and customary and medical necessity are two separate issues. Many if not all states have at least two statutes guiding two, if not three medical billing limits. Federal regulations can also guide nationally recognized maximum allowable charge limits standard(s). The vast majority of medical insurance plan documents, and medical stop loss policies detail R&C language and/or direct fee schedule reference to avoid ambiguity when it comes time to pay claims.
As a general rule, it is not uncommon to see medical billings invoiced at about 4 times (400%+)what most physicians and or hospitals "expect and accept" (after managed care contractual adjustments subject to stated policy coverage limits, exclusions, and/or legislated limits). Coverage for out of network care can be materially reduced posing real problems to members who thought they were protected against unlimited and uninsured medical charges. This is a growing problem - especially in ACA compliant unlimited EHB coverage(s). Balancing the primary promise of reasonable insurance against ACA compliant policy language excluding care, or care received "out of network" can be complicated and contentious.
The attached link references a Johns Hopkins study showing median physician charges to "Medicare Allowable" billed was at 2.5 times more. The future looks even more interesting - see QPP and MACRA
see bill H.R. 2 Medicare Access and CHIP Reauthorization Act of 2015 http://www.medscape.com/viewarticle/874584?src=wnl_mdplsnews_170120_mscpedit_wir&uac=166293CV&impID=1275798&faf=1
Reinsurance is an insurance which provides coverage for catastrophic medical charges incurred by a plan member. Generally, the three types of medical reinsurance are HMO reinsurance, Workers Compensation reinsurance, and CHAMPUS/Tricare reinsurance. Reinsurance applies to re-insuring an insurance policy.
An insurance policy provision allowing for all or part of premiums being refunded where the policy coverage was never accessed by the insured, These are not uncommon in Long Term Care policies. Sometimes the provision is combined with a term life insurance death benefit payout offering both LTC payout to the insured, with up to 20% of death benefit inuring to the beneficiaries. Read the policy carefully.
The termination of the split dollar (life insurance plan paid for by the employer - SERRP)plan and the resulting transfer of sole ownership to the insured employee is called a rollout. Not the same as roll-up, which is typically a term used when describing interest rate performance in an annuity.
A DOL issued exemption from a fiduciary standard disclosure requirement related to facts and circumstances surrounding an investment alternatives, and making a RECOMMENDATION involving qualified money. (i.e. some IRAs, 401, etc.).
Investment recommendations involving investment funding from qualified accounts DOES require separate sign off and management from a registered financial advisor or institution.
4 Federal cases are in litigation to further define what does not invoke a fiduciary standard.
Compliance is slated for April 2016 and January 2017.
SEE DOL explanation of who is and is not subject to BIC or BIR
A Run Out is the amount of time after the policy year to notify the carrier of pending claims. New claimants presented after the deadline are ineligible for reimbursement. The Run Out can be significantly affected by the conditions of claim payment at the end of the Run Out term.
CMS term for Safety Net Providers. The “Low-Income Health Access” Open Door Forum (ODF) has been renamed as the “Safety-Net Providers” ODF. A forum for issues of concern to Medicare and Medicaid providers and suppliers who furnish services to low-income and vulnerable populations. Federally-Qualified Health Centers (FQHCs), Rural Health Clinics (RHCs), Tribal Clinics, Hospitals, and others are encouraged to participate on the calls.
Medical benefit plans employers can establish to pay for eligible insurances with pretax funds, and thereby save approximately 7.65% of payroll taxes. Many eligibility rules and regulations apply to maintaining tax preferred funding of employee benefits. Section 125 plans are different from HRA accounts. Section 125 account balances NOT spent on eligibile medical expenses during the policy year DO roll over to subsequent years, and can be used in retirement too. Tax considerations and regulations are many, and must be confirmed with Licensed CPA’s or attorneys.
A plan typically operating under ERISA that offers medical insurance to employees. Sometimes referred to as "Self Insured", a Self Funded insurance is a statutorily compliant plan of insurance characterized by high deductible. These plans are typically less expensive and more flexible than buying "Fully-Insured" medical plans with lower deductibles. Self funded plans take many forms, and contractual structure. Self Funded Plans are typically characterized by deductibles (to the employer, not the individual employees) over $35,000. Most common are ERISA (employer) Group plans, General Liability, Professional Liability and Workers Compensation self funded plans, etc. Many payment rules, statutes, regulations and standards apply to claims settlements. See Fronted and Reinsured Assignments.
Blue Cross defines, " service area means 1) the geographic area certified by the Marketplace through QHP; or 2. if not a QHP, the geographic area approved by the Agency for Health Care Adminstration (AHCA); and in which rates have been approved by the Florida Office of Insurance Regulation (OIR)."
The association health plan is a self funded ERISA major medical group insurance that is exempt from community rating, and operates under ERISA. Advantages include an advanced aggregate reinsurance coverage, lower agent & TPA fees, favorable experience discounts and other significant savings. Typical minimum program requirements include 1,000 lives and retention at $50,000. Pooling of first dollar risk among multiple employers is prohibited (except for possible MEWA where permissible). Favorable experience is rewarded by refunding unused premium and discounting future premium. A single employer trust offers a middle ground between the higher risk of traditional self funding, and the higher cost of a fully insured benefit while providing a fixed monthly premium easily budgeted by the employer. They are different from Level Funded plans by offering higher retention levels which means managing more risk.
A federal medical insurance program generally available to small business under 50 FTE's (who average under $50K income excluding business owners), that offers potential BUSINESS tax credit up to 50% of what the employer contributes towards an employees premium. Tax credits are offered up to two years. Second year tax credit it up to 35%. Enrollment is 100% electronic, and premium payments must be in no later than the 15th of each month. See: Small Employer Tax Credit
Small Employer Tax Credit
Small employers (those with fewer than 25 full-time employees) may be eligible to receive a tax credit for premiums paid for employee health insurance coverage. The credit may be carried back one year and forward 20 years.
The available credit is subject to limitations based on:
• the number of employees
• the average annual wages paid to employees
The maximum small employer health insurance premium credit available to eligible small (For Profit)employers is 50 percent of workers’ health care premiums paid by small employers and 35 percent of such premiums paid by small tax-exempt (Not for profit) employers, such as charities. It is only available if an employer obtains coverage through a Small Business Health Options Program (SHOP) in the ACA Healthcare Marketplace.
Source: Florida Agent Licensing Exam Course
Under ACA, A special enrollment period is a 60-day period during which individuals may sign up for permanent major medical insurance coverage through the health insurance marketplace. A special enrollment period must be triggered by certain qualifying life events or extraordinary circumstances. see www.Healthcare.org
Individuals who miss open enrollment generally cannot sign up for coverage until the next open enrollment period begins, unless they qualify for a special enrollment period due to a qualifying life event such as:
• getting married
• having or adopting a child
• placing a child in adoption or foster care
• involuntary loss of other health coverage due to:
o turning age 26 under a parent’s coverage
o termination of employment
o expiration of COBRA coverage
o loss of Medicaid or CHIP eligibility
o closing of a plan year
o decertification of a health plan
• moving one’s residence out of the area served by an existing plan
• becoming newly eligible to sign up due to:
o gaining citizenship
o gaining status as a member of an Indian tribe
o leaving incarceration
• if already enrolled, having a change in household status or income that affects eligibility for subsidies
However, individuals who qualify for Medicaid or for the Children’s Health Insurance Program (CHIP) can enroll at any time of the year. Also, small business owners (those with 50 or fewer full-time employees) can obtain employee coverage through the Small Business Health Options Program (SHOP) Web site (www.healthcare.gov/small-businesses) at any time of the year.
Steerage refers to managed care procedures that direct members inside a contracted network of providers. Sometimes referred to as repatriation, Steerage also refers to the effectiveness of utilization review functions to get out-of-area members back into the local contracted network. This is especially important to the management of transplant, burn, rehabilitation and neonatal patients.
Stop loss is an insurance which provides reimbursement for catastrophic medical claims incurred by a self-funded employer's employee or by a capitated HMO member. There are two primary types of medical stop loss - employer stop loss and provider stop loss (provider excess loss).
Subrogation is the right of recovery of one party against another party. This can refer to the rights of the HMO or provider group to recover additional monies from a second insurance policy. In managed care, it refers mostly to an obligation of the provider group to use all legal remedies to repay the reinsurer for any claims paid, and whatever else they can collect.
Suitability refers to the appropriateness of recommended transactions when considering the risks and benefits associated with a transaction relative to a customer’s age, assets, current insurance holdings, financial situation (income and net worth), financial needs, and investment objectives.
A retirement/disability/life insurance plan paid by taxed (non qualified)employer funding, that may also allow complete employer reimbursement of the benefit (deferred compensation) at death of a key executive.
Typically refers to an insurance company that is Eligible but not Authorized to write policies in a given state. Surplus lines carriers are usually referred to as "non-Admitted" markets/carriers. Surplus Lines policies do not enjoy State Insurance Guarantee Association support in the event of insolvency. States mandate special disclosure to policy holders of Surplus Lines carrier status. Surplus Lines carriers can be extremely large, and extremely well funded. As a general rule, surplus lines coverage is attractive when the carrier rating is A or better and used when desired coverage terms are unavailable in the "admitted carrier" market. There are entities like Citizens JUA (joint underwriting association) that insures windstorm risk in Florida. Citizens is not a surplus lines carrier, and does not enjoy State Guarantee Association. Citizens is an UNRATED insurer.
Surplus Reinsurance is coverage that effectively transfers premium from the primary insurer to the Reinsurer thereby improving capital reserve ratios and financial ratings. Typically, these reinsurance agreements are in the form of a Quota Share arrangement with profit sharing reverting back to the primary insurance carrier for a risk charge. Coverage typically responds at 125%+ of the expected claims value. See Finite Reinsurance
Sometimes referred to as a Contract Basis, or Contract Period - Term refers to the policy year and claims submission period deadline. A typical stop loss term is for a 12/18 period. Here the policyholder's claimant has 12 months to accrue the claim, and 6 months after the policy year to report it to the carrier. Policies can be written on either a "Reported" or "Paid" bases. The Reported bases is richer coverage. Other Terms are 12/12, 12/15 and 12/24.
The Health Information Technology for Economic and Clinical Health Act of 2009 (HITECH) promotes the adoption and meaningful use of HIT. State statutes, such as the California Senate Bill CSB 1381, protect in varying degrees the privacy of PII and PHI.
The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) changes the way Medicare rewards clinicians for providing quality care by streamlining multiple quality programs into a new Quality Payment Program tied to Part B Fee-For-Service payments. With the implementation of MACRA and the replacement of the Sustainable Growth Rate, we will pay clinicians participating in the Merit-based Incentive Payment System or Advanced Alternative Payment Models of the Quality Payment Program beginning in 2019
A quality insurance vernacular which is the same or similar to Total Quality Improvement, Medical Pathways, Critical pathways, Total Quality Improvement, etc, and whose goal is to lower costs, and improve outcome of medical care delivery.
Treaty reinsurance is reinsurance of specified types or classes of insured exposures that are automatically "ceded” or accepted by the Reinsurer within the terms of the reinsurance contract or "treaty" without evaluation of each individual exposure. The reinsurance takes effect as soon as the primary insurance is sold. Treaty reinsurance is a general term used to discuss several types of coverages that can include profit sharing features.
This type of financial guarantee bond is placed between the capitating HMO and the provider group as a safeguard against insolvency or bankruptcy. Different from the standard types of surety bonds which require 75% collateral, approved provider groups do not have to freeze their assets through an ILC. It is priced at 2% of face.
Jargon used to describe adverse selection caused by sick (high medical claims) members staying on a plan, and/or healthy people leaving a plan. Generally, most plans will not survive more than 1-3 years in such circumstances.
See Bundled Payments.
VBR is an amorphous term used to define various types of "bundled", DRG, per diem, cost per confinement, etc priced care packaged as is deemed "valuable" by whatever index the buyer or seller fines valuable. Its implied goal is to improve medical outcomes at a lower cost, improve medical outcomes, and prevent up-coding single procedures into multiple procedures/charges. see Bundled Payments
A life insurance policy that is typically sold to investors by an insured with less than two years to live. Viaticals offer a terminally ill person access to funds prior to death. There are primary, secondary and tertiary markets for Viaticals. (See LE)
Benefit offerings paid for by employer and/or employees. Sometimes referred to as “Ancillary Benefits” these insurances typically insure: Life, Dental, Short term Dissability, Long term care, Critical Illness, Accident only, Cancer, Cardiac,stroke/transplanct, long term disability, Hospital lump sum per diem GAP, etc.
A state mandated insurance coverage offering: Unlimited Medical insurance, Life insurance, disability insurance, and liability cover. Each state is different. Employers purchasing compliant comp enjoy some liability immunity. Employers not purchasing statutory cover may be guilty of a third degree felony.
See MCC, IME, EMA, DWC25 form, MSA, MMI, IW, etc.