Mod 3 set 2- Employer action-- EHC

Question 1

what is the EHC?

Answer 1

• Extended health care plan offered separate from dental
• tops up what is covered by the prov health plan
• “wrap around” or “2nd payer”

Question 2

who is covered under these plans?

Answer 2

• ee and their dependents up to 18 or 25 if in school

- their spouses

Question 3

what are the two cost-sharing strategies

Answer 3

1. deductibles
   - ee required to pay fixed amount either per claim (3$ per prescription) or fixed amount per year
2. co-insurance
   - ee and er split the cost with %
   - ex “80% co-insured” means er pays for 80% of what ee is eligible to get, ee pays rest

Question 4

what are the two types of drug plans EHC plans offer?

Answer 4

• prescriptions are biggest cost driver
  1. prescription drug plan
• covers drugs that legally require a prescription
  2. Prescribed plan
• covers any drug bought from a pharmacist and is prescribed
• covers over the counter

Question 5

what are the two ways that an employee is reimbursed for the drugs?

Answer 5

1. non-pay direct
   - they pay and then send the receipt
2. pay direct
   - show a card and then the amount is deducted right away

Question 6

what is covered by EHC in terms of hospitals

Answer 6

• covers up to private/semi-private rooms

- #of EHC plans that cover unlimited private hospital accommodation is decreasing …

Question 7

what is covered by EHC in terms of medical supplies and services

Answer 7

EHC covers most charges for services/supplies that are necessary and have been referred by a doctor

ex.
- private duty nursing
- ambulance services
- paramedical services (physio, chiro)

Question 8

what is covered by EHC in terms of vision care

Answer 8

reimbursement for eye exams

given a $ amount for every 12-24 month period for glasses

Question 9

what are the cost drivers for an EHC plan?

Answer 9

• prescription drugs
• changing demographics (working population is ageing and people living longer)
• gov’t cost shifting (provincial health plans transferring responsibilities to EHC)
• obesity

Question 10

cost containment measures for EHC:

3

Answer 10

1. raise deductibles, coinsurance
2. drug program modifications
   - generic substitution
   - therapeutic substitutions
3. HCSA - giving the ee a fixed $ amount that they can spend, will be more conscience of spending `

Question 11

what is the largest cost for the er in terms of health coverage

Answer 11

dental needs

Question 12

what are some dental benefits?

Answer 12

• basic services (cleanings, preventative care, x-rays, fillings)
• supplementary basic services (root canals)
• major services (dentures)
• ortho (braces)

Question 13

how do the ee’s contain the cost of dental coverage?

Answer 13

1. high coinsurance of basic services (preventative)

2. lower coinsurance of major services

Question 14

what happens when the ee needs a large surgery done? (costly)

Answer 14

• before the surgery, an estimate is sent to the er

- if ee dental work > dental guide, er reimburse up to a suggested fee

Question 15

what is the income tax on health plans?

Answer 15

• if ee pays for a proportion, the premiums are not tax deductible, meaning they pay tax on it
• er contributions are tax deductible meaning not considered as income
  basically they are given tax breaks for paying for health needs,

Question 16

Where has there been dramatic increases on costs?

Answer 16

• check ups

- periodontal aka gum surgery

Question 17

cost containment strategies?

Answer 17

• reduce frequency of check ups

- lowering coinsurance on periodontal aka gum surgery