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Employers

Employer Bulletin

Local Health Employers
Vol. 21, Local O
November 26, 2004

2005 Wisconsin Public Employers Group Health Insurance Reporting Forms; Dual-Choice Due Dates; Reporting and Assembly of 2005 Health Reports; Group Insurance Board offers Three-Tier Health Insurance Program for Local Governments; Payments to Employees in lieu of Health Insurance Coverage Prohibited

Review this bulletin carefully—there are important changes for Plan Year 2005, including changes to reporting forms. If you have questions regarding this bulletin, please contact the ETF Employer Communication Center at (608) 264-7900 or e-mail ETF from the Contact Us page of our Internet site, http://etf.wi.gov.

The following 2005 Wisconsin Public Employers (WPE) Group Health Insurance reporting forms and documents are enclosed:

The Department of Employee Trust Funds (ETF) recently revised the WPE Health Insurance Summary – 2005 and WPE 2005 Monthly Coverage Report to reflect new health insurance program options available to local employers. These forms display the new Program Option Code and Surcharge Code in the title of the reporting forms and include the 2005 premiums. Premiums for each health plan differ depending on the program option. You must use the reporting forms corresponding to the program option in which you are enrolled.

The 2005 reporting forms for the program option in which you are enrolled are attached. However, due to the complexity of the changes to reporting, please compare the forms provided to the list of forms below to verify that the correct forms are included.

Note: You will remain in the same program option as in past years - "Traditional HMO paired with the Classic Standard Plan" - until you submit a resolution electing an alternative program option and that resolution is approved by ETF.

The list below identifies the 2005 reporting forms (revised 10/2004) based on all of the program options available in 2005. Please use only the forms for the option in which you are enrolled:

Traditional HMO paired with the Classic Standard Plan (Current Program Option for most employers)

    1. WPE Traditional HMO/Classic Standard Plan PGM OPT 02 & SRCHG S01 Health Insurance Summary – 2005 (ET-1631)
    2. WPE Traditional HMO/Classic Standard Plan PGM OPT P02 & SRCHG S01 2005 Monthly Coverage Report (ET-1630)
    3. WPE Annuitants Traditional HMO/Classic Standard Plan PGM OPT 02 & SRCHG S01 Health Insurance Summary – 2005 (ET-1655)
    4. WPE Annuitants Traditional HMO/Classic Standard Plan PGM OPT P02 & SRCHG S01 2005 Monthly Coverage Report (ET-1657)

Traditional HMO paired with Standard Preferred Provider Plan (PPP)

    1. WPE Traditional HMO/Standard PPP PGM OPT P03 & SRCHG S01 Health Insurance Summary – 2005 (ET-1652)
    2. WPE Traditional HMO/Standard PPP PGM OPT P03 & SRCHG S01 2005 Monthly Coverage Report (ET-1643)
    3. WPE Annuitants Traditional HMO/Standard PPP PGM OPT P03 & SRCHG S01 Health Insurance Summary – 2005 (ET-1644)
    4. WPE Annuitants Traditional HMO/Standard PPP PGM OPT P03 & SRCHG S01 2005 Monthly Coverage Report (ET-1658)

Deductible HMO paired with Deductible Standard Plan

    1. WPE Deductible HMO/Deductible Standard Plan PGM OPT P04 & SRCHG S01 Health Insurance Summary – 2005 (ET-1649)
    2. WPE Deductible HMO/Deductible Standard Plan PGM OPT P04 & SRCHG S01 2005 Monthly Coverage Report (ET-1647)
    3. WPE Annuitants Deductible HMO/Deductible Standard Plan PGM OPT P04 & SRCHG S01 Health Insurance Summary – 2005 (ET-1653)
    4. WPE Annuitants Deductible HMO/Deductible Standard Plan PGM OPT P04 & SRCHG S01 2005 Monthly Coverage Report (ET-1645)

Deductible HMO paired with Deductible Standard PPP

    1. WPE Deductible HMO/Deductible Standard PPP PGM OPT P05 & SRCHG S01 Health Insurance Summary – 2005 (ET-1650)
    2. WPE Deductible HMO/Deductible Standard PPP PGM OPT P05 & SRCHG S01 2005 Monthly Coverage Report (ET-1648)
    3. WPE Annuitants Deductible HMO/Deductible Standard PPP PGM OPT P05 & SRCHG S01 Health Insurance Summary – 2005 (ET-1654)
    4. WPE Annuitants Deductible HMO/Deductible Standard PPP PGM OPT P05 & SRCHG S01 2005 Monthly Coverage Report (ET-1646)

It is critical that you use only the 2005 Summary and Monthly coverage reports when reporting for 2005.

Please use the most recently revised enrollment and information change forms for Plan Year 2005:

For additional reporting forms or applications, please contact ETF’s Supply and Mail Services Section at (608) 266-3302.

“Tiering” Change to 2005 Monthly Coverage Reports

The WPE 2005 Monthly Coverage Report for each program option includes a check box related to employer/employee premium share allocation, offered with the 2005 changes. This box is located in the lower right corner of the form. Each month, check the box corresponding with the method you use to determine employer/employee contributions — either the traditional 105% or tiering. For more information on tiering, see Legislature Adopts Three-Tier Health Insurance Program for Local Governments on page 6.

Tips for Completing Health Insurance Applications and Corresponding Reports Throughout 2005

Enrollment applications, monthly reporting forms, and premium remittances must be complete and accurate in order to ensure proper and prompt health insurance coverage for your employees. In addition, statistics generated from the monthly data submitted by employers is used to track the movement of individuals between the participating health plans and counties. This information is used in the rate setting process for the Group Health Insurance Program.

Consult Subchapters 501 and 502 of the Health Insurance Employer Administration Manual (ET-1144) for information concerning the “Prospective Date of Coverage” entered on the Health Insurance Application (ET-2301) and “Effective Date” entered on the Monthly Additions Report (ET-2610). Consult Subchapter 507 for information concerning effective dates of termination of coverage.

2005 Dual-Choice Due Dates and Reporting Instructions

The January 2005 health insurance reports are due Monday, December 20, 2004. Employers are encouraged to submit the January 2005 reports as early as possible, given the volume of changes resulting from Dual-Choice.

Note: Do not divide the January transactions between Dual Choice and “regular.” Both Dual-Choice and regular (non-Dual-Choice) transactions must be combined on the WPE Health Insurance Summary – 2005 form, WPE 2005 Monthly Coverage Report, Monthly Additions Report (ET-2610), Monthly Deletions Report (ET-2612), and the Monthly Changes Report (ET-2614).

January 2005 health insurance reports will include:

    1. Two copies of the completed WPE Health Insurance Summary – 2005 form for your appropriate program option and the corresponding WPE 2005 Monthly Coverage Reports for each health plan, indicating all of the contracts (Dual-Choice and non-dual-Choice) added and deleted for the coverage month of January 2005.
    2. Two copies of the Monthly Additions Report (ET-2610), Monthly Deletions Report (ET-2612), and Monthly Changes Report (ET-2614) on which regular monthly transactions and Dual-Choice transactions (enrollment Type Codes 40 and 43 titled “Dual-Choice”) are combined. ETF Coverage Report plies of the Dual-Choice and the regular (non-Dual-Choice) applications must be attached to the corresponding Monthly Additions Report (ET-2610). A Monthly Deletions Report (ET-2612) for each health plan, listing each employee leaving that health plan at year-end, must be submitted.

NOTE: Each entry on the Monthly Additions Report (ET-2610) must indicate the suffix number of the previous health plan in the ‘From’ column (the employee’s current health plan). Do not substitute the name of the health plan for the health plan suffix number.

Each entry on the Monthly Deletions Report (ET-2612) must indicate the suffix number of the newly elected health plan in the ‘To’ column. Do not substitute the name of the health plan for the health plan suffix number.

Written requests to use an alternate form of reporting or to deviate from completing/ assembling the reports in the manner described herein, must be submitted to ETF and must be approved in advance. Requests must be received by ETF no later than Friday, December 3, 2004, and must include the alternate form(s) and/or alternate assembly method. Mail or e-mail request to:

Ron Diehl
Division of Trust Finance & Employer Services
Department of Employee Trust Funds
P O Box 7931
Madison, WI 53707-7931

E-mail ron.diehl@etf.state.wi.us

Assembly of all Health Insurance Reports for 2005 (Including January Dual-Choice Reporting)

Assemble your reports in the following order (resulting in two sets of reports in descending order):

I. ETF Report Packet

    1. WPE Health Insurance Summary – 2005. Attach the premium remittance check to the front of the Summary. (Please see instructions above for additional requirements for the Dual-Choice reports.)
    2. WPE 2005 Monthly Coverage Report. Attach one Monthly Coverage Report per health plan with contracts to report. Assemble in the order in which the health plans are listed on the Monthly Coverage Report. (Please see instructions above for additional requirements for the Dual Choice reports.)

      Attach corresponding Monthly Additions Report (ET-2610), Monthly Deletions Report (ET-2612), and the Monthly Changes Report (ET-2614) with applications and other supporting documentation (stapled in the upper left corner) to the respective Monthly Coverage Report in the order listed below.

      1. Monthly Additions Report (ET-2610)
        • Assemble ETF Coverage Report plies of Health Insurance Application (ET-2301) in the order in which the specific subscriber information is listed on the Monthly Additions Report.
      2. Monthly Deletions Report (ET-2612)
        • Assemble any necessary supporting documents (such as the Group Health Insurance Cancellation Report [ET-1616]) in the order in which the specific subscriber information is listed on the Monthly Deletions Report.
      3. Monthly Changes Report (ET-2614)
        • Assemble ETF Coverage Report plies of Health Insurance Application (ET-2301) and/or Medicare Eligibility Statement (ET-4307) in the order in which the specific subscriber information is listed on the Monthly Changes Report.

II. Health Plan Report Packet (Carrier Copies):

    1. Copy of WPE Health Insurance Summary – 2005
    2. Copy of WPE 2005 Monthly Coverage Report. Attach one copy of Monthly Coverage Report per health plan with contracts to report. Assemble in the order in which the plans are listed on the Monthly Coverage Report. Attach corresponding Monthly Additions Report (ET-2610), Monthly Deletions Report (ET-2612), and the Monthly Changes Report (ET-2614) in the order listed below.
      1. Monthly Additions Report (ET-2610) – No supporting documentation attached.
      2. Monthly Deletions Report (ET-2612) – No supporting documentation attached.
      3. Monthly Changes Report (ET-2614) – No supporting documentation attached.

Mail both sets of reports to:

Division of Trust Finance & Employer Services
Department of Employee Trust Funds
P O Box 7931
Madison WI 53707-7931

For questions on the proper way to assemble your monthly health insurance reports, call Ron Diehl at (608) 266-2737 or e-mail ron.diehl@etf.state.wi.us.

Late Dual-Choice Applications

Follow the instructions in Subchapter 406 of the Local Health Insurance Employer Administration Manual (ET-1144, Revised 6/97) for late 2005 Dual-Choice Applications. Please forward a photocopy of the Health Insurance Application (ET 2301) or Health Insurance Application (ET 2302), the letter from the employee, and your memo to Wendy Pink, Division of Trust Finance & Employer Services, Department of Employee Trust Funds, P.O. Box 7931, Madison, WI 53707-7931, or send via fax at (608) 266-5801. ETF will review the material and issue a letter approving or denying the request, along with reporting instructions.

Legislature Adopts Three-Tier Health Insurance Program for Local Governments

The State Legislature, acting on a Group Insurance Board (Board) recommendation, recently adopted a three-tier health insurance premium model option for local governments effective January 1, 2005. This option provides local employers with additional flexibility in setting premium contributions. The rule amended Wis. Adm. Code s. ETF 40.10 (1) and (2) and created ETF 40.10 (2)(d).

The Board believes that a three-tiered approach to health insurance purchasing will aid both state and local employers in combating escalating health care costs. Currently, participating local employers are required to pay at least 50%, but not more than 105%, of the lowest-cost health plan in their service area. The Board determined that the 105% formula had several shortcomings, including a lack of incentive for health plans to hold down premium costs. In addition, the 105% formula played a major role in driving up the cost of the Standard Plan to the point where it is no longer affordable for many employees.

The three-tier premium option is designed to address these problems without curtailing high-quality, low-cost health care coverage. While maintaining a uniform benefit package, the Board has assigned each health plan to one of three tiers based on the relative efficiency with which a health plan is able to provide the benefits and the quality of care required by the Board. Health plans attain extra credit in the tier assignment process when they score well on measures of quality, patient safety, and customer satisfaction. This approach creates significant incentives for health plans to hold down premiums charged to the State while guaranteeing that all employees have access to a Tier 1 health plan. The 2005 Plan Tiering is as follows:

2005 Health Plans by Tier for Active WPE Employees

TIER 1
ATRIUM HEALTH PLAN
COMPCAREBLUE - AURORA/FAMILY
COMPCAREBLUE NORTHWEST
COMPCAREBLUE SOUTHEAST
DEAN HEALTH PLAN
GHC EAU CLAIRE
GHC-SOUTH CENTRAL
GUNDERSEN LUTHERAN
HEALTH TRADITION
HUMANA-WESTERN
MEDICAL ASSOCIATES HMO
MERCYCARE HEALTH PLAN
NETWORK-FOX VALLEY
PHYSICIANS PLUS
PREVEA HEALTH PLAN
UNITEDHEALTHCARE
UNITY-COMMUNITY
UNITY-UW HEALTH
STATE MAINTENANCE PLAN

TIER 2
COMPCAREBLUE NORTHEAST
HUMANA-EASTERN

TIER 3
STANDARD PLAN

Local employers establish employee and employer premium contribution amounts in accordance with collective bargaining and/or compensation plans in effect. The new legislation provides employers with an additional option to consider when determining employer and employee contributions, but employers must pay an employer share of contributions as explained below:

Options if Employer Selects Tiering
Current "105%" Formula
Employer Contributions
Employer Contributions
  1. To determine the employer contribution, subtract the employee contribution a mount for the plans in the tier from the total plan premium for either single or family.
  2. Minimum contribution is unchanged at 50% of the lowest cost qualified health plan in service area for full time insurance employees.
  3. No contribution requirement of 105% of lowest cost health plan in service area for full time insured employees
  4. Minimum contribution is 25% of the lowest cost qualified health plan for insured part-time employees appinted to work less than 1044 hours.
  5. Optional for retirees, surviving dependent or eligible employees on leave of absence.
  1. Contribution must fall within 50% to 105% of lowest cost qualified health plan in service area for full time insured employees.
  2. Minimum contribution for insured part-time employees appointed to work fewer than 1044 hours is 25% of the lowest cost qualified health plan.
  3. Optional for retirees, surviving dependent or eligible employees on leave of absence
Employee Contributions
Employee Contributions
  1. In accordance with collective bargaining and/or compensation plans.
  2. Single or family coverage premiums remain constant for all health plans within the same tier, regardless of the total premium amount.
  3. Premiums must increase a minimum of $20 for single and $50 for family coverage between successively higher cost premium tiers.
  1. In accordance with collective bargaining and/or compensation plans.

The following example illustrates how employers determine either the minimum or maximum full time employee contribution toward the overall premium cost.

Example: Assume there are only three plans in the service area of the employer and all are qualified. One plan falls into each tier, and the single and family premiums are shown in the following table along with the potential minimum OR maximum full time employee premium contribution:

Tier
Total Single Premium
Minimum Employee Contribution
Maximum Employee Contribution
Total Family Premium
Minimum Employee Contribution
Maximum Employee Contribution
1
$400.00
$0.00
$200.00
$900.00
$0.00
$450.00
2
$440.00
$20.00
$240.00
$1,000.00
$50.00
$550.00
3
$950.00
$40.00
$750.00
$2,000.00
$100.00
$1,550.00

Employers electing to implement the tiering premium option to employees need only inform ETF on the monthly WPE 2005 Monthly Coverage Report. No resolution to adopt the tiering premium is required (see “Tiering” Change to 2005 Monthly Coverage Reports, above.)

Payments to Employees in lieu of Health Insurance Coverage Prohibited

Employers are reminded that the 2005 Group Health Insurance contract prohibits payments made to employees in lieu of the health insurance coverage under the Wisconsin Public Employers (WPE) Group Health Insurance Program. To reiterate previous guidance, ETF does not intend to penalize a municipality for having such a provision in its collective bargaining agreements or personnel rules as long as the municipality makes a good faith effort to remove the provision as soon as practicable.

As this provision is removed from personnel rules and collective bargaining agreements, you will need to provide an enrollment opportunity to employees who formerly opted to accept payments in lieu of health insurance coverage. If otherwise eligible, these employees will have a special 30-day enrollment period to become insured in the WPE Group Health Insurance Program without waiting periods for pre-existing conditions.

Notify all affected employees of this special enrollment opportunity in writing and provide these employees with a Health Insurance Application (ET-2301). Employees must complete and return the application to the employer no later than 30 days after written notification. Coverage is effective on the first of the month following the receipt of the application. Check the “Other” box in section A of the application and insert “opt out provision” in the space provided. However, employees declining coverage must also complete an application, marking the appropriate box above the signature block.

In the notification, employees should be reminded that enrollment is optional; they are not required to enroll once the provision is removed from personnel rules and collective bargaining agreements. Many employees who have opted out do so because they have other coverage in place and eligible employees declining coverage may take advantage of other special enrollment periods if other coverage is lost or if there is a marriage, birth, or adoption. Employees who decline coverage but later wish to enroll without benefit of a special enrollment period are restricted to the Standard Plan with a 180-day waiting period for pre-existing conditions. Refer to the 2005 It’s Your Choice booklet (ET-2128) for information on other enrollment opportunities.

Please submit a complete list of employees offered enrollment during the special 30-day enrollment opportunity to ETF’s Employer Communication and Reporting Bureau as soon as you inform employees of this opportunity. Applications to accept or decline coverage should be submitted as soon as received. If you have questions regarding this process, please contact the ETF Employer Communication Center at (608) 264-7900 or e-mail ETF from the Contact Us page of our Internet site, http://etf.wi.gov/.

 

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