Miscellaneous 1 Flashcards
“Pendelum Effect” between the Medicare program & MA plans
~Republicans - free markets & competition
~Democrats - regulation & accountability for MA plans
Rx - coverage is considered creditable if..
it is at least as good at Medicare Part D
2 special Part D groups
~dual eligibles
~limited-income beneficiares
PDPs (prescription drug plans) defined as:
~must offer “standard benefit”
~may offer supplemental benefits - “enhanced benefits”
~can be flexible in plan design
~must follow marketing guidelines
those who benefit most from Part D
~no current drug insurance
~those who qualify for low-income subsidy assistance
~patients in MA with no drug coverage
~those who spend > $800 per year on Rx
MSP applies if the member has
Medicaid or a commercial health plan
Rx - coverage is considered creditable if it passes the
gross test
The ACA added the ________ for Medicare part D
Coverage Gap Discount Program
True or False
Employer Group plans do not submit part D bids
True
Medicare Supplement plans are filed with who?
state insurance departments
cost of employer groups relative to individual Medicare beneficiaries
substantially lower
For Rx benefits, employers or unions can provide benefits to Medicare eligible beneficiaries in the following ways:
- EGWP from 3rd party (800 series)
- primary coverage without a retiree drug subsidy (RDS)
- primary coverage with an RDS that offsets plan costs
- direct PDP contract with CMS & administering the plan directly
Which states provide disability wage replacement to workers
~California ~Hawaii ~New Jersey ~New York ~Rhode Island
social security - OASDI acronym
old-age, survivors, & disability insurance
level of utilization for Medicaid enrollees compared to commercial usue
significantly higher, particularly for the aged, blind, & disabled recipients
source of Medicaid funding
- Federal Government: 50-73% for each state
- state budgets
- federal government covered all of expansion costs til 2016, phased down to 90% by 2020
Impacts of ACA on Medicare Advantage
- Introduced payments based on quality measures (star rating)
- Minimum Loss Ratio of 85%
- Reduced benefits/ funding & increased premiums
Medicare Advantage - if a bid is over the benchmark..
member pays a premium
CMS - HCC.
What is it and 2 characteristics.
~risk adjustment methodology for MA-PD
~additive for multiple conditions
~uses IP, OP, age, sex, & eligibility status
Medicare Advantage - if the bid is below the benchmark..
the plan keeps a % of the difference to increase benefits or reduce cost sharing or premiums. rest of % is kept by CMS
Medicare Advantage started in what year?
1984 with the Tax Equity & Fiscal Responsibility Act (TEFRA)
Medigap policy many not be sold to beneficiaries enrolled in ___________
a Medicare Advantage Plan
when did Medicare Part D become available
2006 under the MMA (Medicare Prescription Drug, Improvement, & Modernization Act)
Funding & cost challenges Medicare & Medicaid face
- rising health care costs
- increasing enrollment
- longer life expectancies
Medicare & Medicaid began in what year?
1965
way for employers to be exempt from SG ACA requirements
be self-funded - usually also purchase reinsurance to protect themselves
Grandmothered plans (transitional plans)
employees renewed these plans in 2013 before the ACA when into effect, most states are allowing them to continue through 2017
grandfathered SG plans
existed before the ACA and are allowed to continue indefinitely as long as their benefits & cost sharing structures do not significanlty
SHOP marketplace
Small Business Health Options Program
- allows small employers to shop, compare, and buy health insurance coverage
- part of the exchange
ACA SG coverage requirements
- Minimum EHB & standardized tiers of coverage
- 1st dollar coverage of approved preventive services
- Eliminates dollar benefit limit & exclusions based on pre-existing conditions
- caps enrollees’ annual OOP liability
natural adverse selection to phase out high-cost employee health insurance option
price option based on actual experience, adverse selection causes the option to price itself out of the market over time
Adverse selection on medical coverage is not sever for the following reasons
- claims are relatively unpredictable (especially for a family)
- decisions are often clouded by emotion. Employees want the best coverage regardless of the cost
- Coverage decisions are often made based on the availability of other coverage, such as through a spouse’s employer.
Rollover options for Canadian HSAs
- 1 year rollover of unused balances
2. 1 year rollover of unpaid claims
may change coverage elections based on these qualifying events
- change in legal marital status
- change in # of dependents
- change in place of work or residence
- significant change in coverage based on spouse’s employment status
- dependent satisfies or ceases to satisfy the dependent eligibility requirements for a particular benefit
a “qualified” cafeteria plan must include the following provisions:
- specific description of each benefit period of coverage applicable
- rules governing eligibility & participants
- procedures for making participant elections
- manner in which contributes may be made
- max amount of employer contributions
- definition of plan year
- description of nondiscrimination testing & optional admin features
2 items that can’t be funded through a cafeteria plan
- LTC insurance
2. whole life insurance
“Vendor Summits” serve the following purposes
- allow various providers to meet & form relationships
- education to all vendors on entire admin process (not just their own specialty area)
- forum where plan sponsor can explain benefit philosophy, customer service expectancies, & specific policy clarification
Quality of care for CDHP participants
- did not forgo necessary care
- significantly higher use of preventive services
- same or higher levels of care for chronic conditions
- greater use of generic drugs & higher overall drug utilization. Increased utilization may be substitution for more costly medical treatment.
Federal laws surrounding CDHPs
- how HSAs must be structured
- minimum deductibles & OOP limits for the HDHPs that accompanied HSAs for the accounts to receive available tax benefits
major forces driving private exchanges
- popularity of defined contribution approaches to health insurance purchasing
- evolution of online purchasing technology
“benefit rush”
individual increases utilization in anticipation of an upcoming benefit change
Actuarial Communications ASOP #
41
Credibility Procedures ASOP #
25
Data Quality ASOP #
23
ACA risk mitigation strategies
- reinsurance
- risk corridors
- risk adjustment
3 ways premium can be expressed
- received
- written
- earned
rate increase (formula)
= Projected loss ratio / desired loss ratio - 1
3 fundamental pricing methods
- tabular method
- buildup & density functions
- simulation
Major medical uses which fundamental pricing method
buildup & density functions
Tabular method of pricing is used for which product
DI
- tables don’t exist for other coverages
Reasons company’s own experience is preferable to using other sources
Reflects its practices regarding
- Underwriting
- Claims administration
- Marketing
- Other functions
Area residence may impact rates for various reasons:
- Patterns of care may be different by area
- Prevailing charges & provider contracts vary by location
- availability of nursing homes in area may impact LTC costs
- varying legal requirements by state can cause large differences (DI)
coverage where occupation is considered
DI
coverage where marital status is concerned the most
LTC
- live-in caregiver
durational deterioration usually due to underwriting which is no longer allowed due to the ______
ACA
Durational Trends
Trends in excess of those generated by insured age alone.
2 sources:
- initial underwriting
- cumulative antiselection
Duration
measures the age of the policy
DI & LTC use ________ structures since they are non-inflation-sensitive coverages
age-leveling premium
average charge per service is based on
negotiated provider payments
medical cost PMMPM formula
annual utilization per 1,000 members * average allowed charge per service / 12,000
community rating
- the experience of a group or individual is not used when calculating rates
- only the collective experience of the entire pool is used
Renewability categories for DI
- Non-cancellable
- guaranteed renewal @ guaranteed premium level - guaranteed renewable
- premium can change - conditionally renewable
- insurer can refuse to renew
- “optionally renewable”
