Contract - Point of Service Amendment 1THE CITY OF
DUB E
~~
Memorandum
March 22, 2007
TO: Michael C. Van Milligen
City Manager
FROM: Randy Peck ~j (1
Personnel Manager V ~
SUBJECT: Point of Service Plan -Amendment I
As summarized in the August 17, 2006, memorandum from Karen Hoffman, Director of
Operations at Health Choices, this amendment brings us into compliance with federal
and state requirements related to qualified medical child support orders, mental health
parity, claims review procedures and continuation of coverage during military leave.
The amendment also modifies the plan document to reflect our employees' contribution
to the health insurance premium.
As indicated in Karen's summary, the mental health parity mandate expands the
coverage for biologically-based mental illnesses. The non-biologically-based benefits
remain unchanged. The amendment has been reviewed by Corporation Council Barry
Lindahl and he found it to be acceptable. The amendment has also been reviewed by
Bill Robinson, our Benefit Actuarial Consultant. The Health Committee has approved of
the amendment. Would you please sign the attached amendment and return it to me.
If you have any questions, please feel free to call.
RP:tlb
Attachments
.r .
HEALTH CHOICES
To: City of Dubuque Healthcare Committee
From: Karen Hoffmann, Director of Operations
Date: August 17, 2006
Re: Amendment I to POS Plan
This memo and attachments is to recap the changes in the above reference amendment:
1. #1 references termination of coverage upon the period of expiration of the period for
which the last premium was paid. This was added due to the addition of premium
contribution by employees.
2. #2, The Qualified Medical Child Support Order section of the plan was added to
maintain compliance with the federal requirements. These provisions have been in
place for sometime and this section explains the process.
3. #3 and #4 update the Schedule of Benefits and Covered Services Section relative to
Mental Health Services. A Mental Health Parity mandate was implemented by the
State of Iowa Department of Insurance 1/1/06. Public sector plans are required to
adhere to these rules for biologically based mental illness. The mandate expands
significantly the coverage for biologically based mental illnesses. The Non-
biologicallybased benefits are what the benefits were previously.
4. #5 updates the Claims Review Procedure to comply with the Department of Labor
regulations. This claims review procedure explains the rights or participants and sets
the timeline for review of urgent, pre and post service claims. Specifically in this
section I have highlighted various sections to ~?iscuss them in :amore detai?. (See Page 3
of this memo for these highlighted sections} The yellow section is new wording and
provides that various timeframes that the Department of Labor Regulations dictate to
payers on timeframes for review and payment decisions on urgent, pre-and post service
claims. (Note that these are defined in the amendment as well.) This section also
dictates the information that must be included in a denial per the DOL Regulations.
The section in green updates the "Appeals and Disputes" paragraphs in the current
document. The concept of the review committee is maintained. The timeframe for the
participant to file their request was increased from 90 to 180 which is a requirement of
the DOL. The remainder of the section dictates the things that the committee should
consider relevant to the claim in question-and again this follows the DOL regulations.
The blue sections-- "Decision & Authority to Interpret Plan" are included without
change from the POS Plan.
The red section-"External Review" was revised to provide more information and is in
compliance with the current Iowa regulations in this regard.
Memo
Page 2
August 17, 2006
5. #6 Continuation of Coverage during Military Leave was updated to comply with the
changes that went into effect in December, 2004. The time periods were altered under
these federal regulations.
6. # 7 amends reference to both the Employer and the Employee making contributions to
the Plan.
Page 1 of 10
City of Dubuque Point of Service Plan
Amendment I
Whereas City of Dubuque established the City of Dubuque Point of Service Plan Document and
Summary Plan Description effective May 1, 2004.
Whereas City of Dubuque wishes to amend said Plan Document and Summary Plan Description
effective (insert effective date).
Now, therefore the Plan Document and Summary Plan Description is amended as follows:
1.) Page 2 the following is added under Termination of an Active Employee's Coverage
effective July 1, 2005:
"4. The expiration of the period for which the last payment was made for coverage under
the Plan."
2.) Page 4 the following is added between Open Enrollment and Schedule of Benefits:
"QUALIFIED MEDICAL CHILD SUPPORT ORDERS
It is the intent of the Plan to comply with the regulations pertaining to Qualified Medical
Child Support Orders (QMCSO). The Participant must present a copy of the Order for
review and acceptance by the Plan Administrator. Only Orders which meet the
requirements of a QMCSO will be honored by the Plan to enroll any eligible dependents
outside of a Special Enrollment Period. The Employee will be required to elect Family
Coverage and pay any applicable contribution for said coverage.
The Child Support Performance and Incentive Act of 1998 (CSPIA) require the Employer
to take certain actions to help enforce state administrative and court orders for medical
child support.
The Employer adopts the following procedures to determine whether medical child
support orders qualify and thus are to be carried out. The Employer may modify or
terminate these procedures to satisfy legal requirements.
A qualified medical child support order (QMCSO) establishes a child's right to receive
benefits for which a plan participant or qualified beneficiary for continuation of coverage
is eligible, and which the Plan has determined meets the requirements to be a qualified
medical child support order.
To qualify, a medical child support order must:
(1) Specify the name and last known mailing address of the participant and the name
and mailing address of each child covered by the order; and,
(2) Include a reasonable description of the type of coverage to be provided by the
Plan to each child, or the manner in which such type of coverage is to be
determined; and,
(3) Specify each period to which such order applies; and,
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(4) Specify each plan to which such order applies.
A QMCSO must not require the Plan to provide any type or form of benefit or any option
not otherwise provided under the Plan, except to meet requirements of Section 1908 of
the Social Security Act (relating to enforcement of state laws regarding child support and
reimbursement of Medicaid).
Upon receiving a medical child support order, the Plan Administrator shall:
Promptly notify in writing the Participant, each child covered by the order, and
each representative for these parties of the receipt of the medical child support
order. The notice shall include a copy of the order and these QMCSO procedures
for determining if the order is qualified;
Permit the child to designate a representative to receive copies of notices sent to
the alternate recipient regarding the medical child support order;
Within a reasonable time after receiving a medical child support order, determine
if it is qualified and notify the participant and child(ren) subject of the order; and
Once the order is determined to be qualified, ensure the child is enrolled
according to plan terms and the order and is otherwise treated by the Plan as a
covered beneficiary for reporting and disclosure purposes. As such, the plan will
distribute to the child a copy of the Summary Plan Description (SPD) and any
subsequent material modifications adopted by the plan sponsor.
In the event the Plan receives a state administrative or court medical child support order
under CSPIA requiring the Employer to withhold employee contributions for group
health coverage for a child, the Employer will determine whether the employee is
covered or eligible under the plan, and whether the child maybe eligible under the plan.
After the Employer determines the employee is subject to income withholding to pay for
the child's coverage, the Employer will notify the Plan Administrator. The Plan
Administrator will then notify the employee, the child and the child's custodial parent
(when that is not the employee) that coverage is or will become available. The Plan
Administrator will furnish the custodial parent a description of the coverage available, the
effective date of the coverage and any forms, documents or other information needed to
put such coverage into effect, as well as information needed to submit claims for benefits.
The Plan Administrator will provide the appropriate enrollment information to the Employer,
who will then determine whether employee contributions are available to pay for the
child(ren)'s coverage. If such funds are available, the plan sponsor will withhold such
contributions from employee income and notify the employee to that effect.
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3) Page 7 deleting the "Mental Health Services" section in the Schedule of Benefits and
replacing with the following effective January 1, 2006:
MENTAL HEALTH SERVICES
Biologically Based Mental Illness
Inpatient
Pre-certification is required.
Limited to 30 days per calendar year
Hospital
Physician
$400 co-pay per admission 70% after deductible
Outpatient 100% 70% after deductible
Limited to 52 visits/days per
calendar year $15 co-pay 70% after deductible
Note: Biologically Based
days/visits apply to Non-
Biolo ically Based Maximums
Non-Biologically Based Mental
Illness
Inpatient
Pre-certification is required. Limit
of 20 days per calendar year in acute
care psychiatric hospital and 10 days
per calendar year of hospital day
care or partial care
Hospital $400 co-pay, then $20 co-pay/day 70% after deductible
Physician 100% 70% after deductible
Outpatient
Limited to 20 visits per calendar 50% co-pay 50% after deductible
year
Note: Non-Biologically Based
days/visits do not apply to
Biolo ically Based Maximums
4.) Page 14, Covered Services subsection (n) deleting all in subsection (n) and replacing with
the following effective January 1, 2006:
Biological Based Mental Health Services are covered. Biological based mental
illnesses include the following psychiatric illnesses:
a. Schizophrenia
b. Bipolar disorders
c. Major depressive disorders
d. Schizo-affective disorders
e. Obsessive compulsive disorders
f Pervasive developmental disorders
g. Autistic disorders
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All inpatient mental health services (except for Emergency Services) require Pre-
certification prior to receiving services and are eligible according to Plan guidelines.
LIMITATION: Inpatient days are limited to 30 days per calendar year and outpatient
visits are limited to 52 visits per calendar year. Medicine checks do apply to the
outpatient visit annual limit. The biologically based mental health service annual limits
do apply toward the non-biologically based mental health annual limits.
Non-Biologically Based Mental Health Services including evaluation, diagnosis and
short term therapeutic services. LIMITATION: Includes only short-term evaluation or
crisis intervention, mental health services, or both. A maximum of twenty (20) out-
patient visits and twenty (20) days of In-patient services and ten (10) days of hospital day
care or partial care are covered per calendar year. The twenty (20) out-patient visits or
office visits are payable at fifty percent (50%) of the allowed amount and subject to the
UCR charge if services are provided by a referral Physician or on an emergency basis.
The In-patient stay is subject to a co-pay per admission plus $20 per day for which the
Participant is liable. The ten (10) days of Hospital daycare or partial care are subject to a
co-pay of $20 per day. Psychiatric testing is counted as an out-patient mental health
office visit. If testing and an office visit occur on same day, it will count as one visit.
The Non-biologically based mental health service annual limits do not apply toward the
biologically based mental health annual limits.
5.) Page 33 under "Claims Review Procedure" by deleting the "Appeals of Claims and
Disputes" and replacing with the following:
Claims and Appeal Process
Following is a description of how the Plan processes Claims for benefits. A Claim is defined
as any request for a Plan benefit, made by a claimant or by a representative of a claimant that
complies with the Plan's reasonable procedure for making benefit Claims. The times listed
are maximum times only. A period of time begins at the time the Claim is filed. Decisions
will be made within a reasonable period of time appropriate to the circumstances. "Days"
means calendar days.
There are different kinds of Claims and each one has a specific timetable for approval,payment,
request for further information, or denial of the Claim. If you have any questions regarding this
procedure, please contact the Plan Administrator.
The definitions of the types of Claims are:
Urgent Care Claim
A Claim involving Urgent Care is any Claim for medical care or treatment where using the
timetable for anon-urgent care determination could seriously jeopardize the life or health of the
claimant; or the ability of the claimant to regain maximum function; or in the opinion of the
attending or consulting Physician, would subject the claimant to severe pain that could not be
adequately managed without the care or treatment that is the subject of the Claim.
A Physician with knowledge of the claimant's medical condition may determine if a Claim is
one involving Urgent Care. If there is no such Physician, an individual acting on behalf of the
Plan applying the judgment of a prudent layperson that possesses an average knowledge of
health and medicine may make the determination.
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In the case of a Claim involving Urgent Care, the following timetable applies:
Notification to claimant of benefit determination
72 hours
Insufficient information on the Claim, or failure to follow the Plan's procedure for filing
a Claim:
Notification to claimant, orally or in writing
Response by claimant, orally or in writing
Benefit determination, orally or in writing
Ongoing courses of treatment, notification of:
Reduction or termination before the end of treatment
Determination as to extending course of treatment
24 hours
48 hours
48 hours
72 hours
24 hours
If there is an adverse benefit determination on a Claim involving Urgent Care, a request for an
expedited appeal may be submitted orally or in writing by the claimant. All necessary
information, including the Plan's benefit determination on review, may be transmitted between
the Plan and the claimant by telephone, facsimile, or other similarly expeditious method.
Pre-Service Claim
A Pre-Service Claim means any Claim for a benefit under this Plan where the Plan conditions
receipt of the benefit, in whole or in part, on approval in advance of obtaining medical care.
These are, for example, Claims subject to pre-certification. Please see the Cost Management
section of this booklet for further information about Pre-Service Claims.
In the case of aPre-Service Claim, the following timetable applies:
Notification to claimant of benefit determination 15 days
Extension due to matters beyond the control of the 15 days
Plan
Insufficient information on the Claim:
Notification of 15 days
Response by claimant 45 days
Notification, orally or in writing, of failure to follow the 5 days
Plan's procedures for filing a Claim
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Ongoing courses of treatment:
Reduction or termination before the end of the treatment 15 days
Request to extend course of treatment 15 days
Review of adverse benefit determination 30 days
Post-Service Claim
A Post-Service Claim means any Claim for a Plan benefit that is not a Claim involving Urgent
Care or aPre-Service Claim; in other words, a Claim that is a request for payment under the Plan
for covered medical services already received by the claimant.
In the case of aPost-Service Claim, the following timetable applies:
Notification to claimant of benefit determination
Extension due to matters beyond the control of the Plan
Insufficient information on the Claim:
Notification of
Response by claimant
Review of adverse benefit determination
30 days
15 days
15 days
45 days
60 days
Notice to claimant of adverse benefit determinations
Except with Urgent Care Claims, when the notification may be orally followed by written or
electronic notification within three days of the oral notification, the Plan Administrator shall
provide written or electronic notification of any adverse benefit determination. The notice will
state, in a manner calculated to be understood by the claimant:
(1) The specific reason or reasons for the adverse determination.
(2) Reference to the specific Plan provisions on which the determination was based.
(3) A description of any additional material or information necessary for the claimant to
perfect the Claim and an explanation of why such material or information is
necessary.
(4) A description of the Plan's review procedures, incorporating any voluntary appeal
procedures offered by the Plan, and the time limits applicable to such procedures.
(5) A statement that the claimant is entitled to receive, upon request and free of charge,
reasonable access to, and copies of, all documents, records, and other information
relevant to the Claim. "You and your Plan may have other voluntary alternative
dispute resolution options, such as mediation. One way to find out what may be
available is to contact your local U.S. Department of Labor Office."
(6) If the adverse benefit determination was based on an internal rule, guideline, protocol,
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or other similar criterion, the specific rule, guideline, protocol, or criterion will be
provided free of charge. If this is not practical, a statement will be included that such
a rule, guideline, protocol, or criterion was relied upon in making the adverse benefit
determination and a copy will be provided free of charge to the claimant upon
request.
(7) If the adverse benefit determination is based on the Medical Necessity or
Experimental or Investigational treatment or similar exclusion or limit, an explanation
of the scientific or clinical judgment for the determination, applying the terms of the
Plan to the claimant's medical circumstances, will be provided. If this is not practical,
a statement will be included that such explanation will be provided free of charge,
upon request.
Appeals
When a claimant receives an adverse benefit determination, the claimant has 180 days following
receipt of the notification in which to appeal the decision. A claimant may submit written
comments, documents, records, and other information relating to the Claim. Upon receipt of the
appeal, a meeting of the grievance committee shall be convened within thirty (30) days. The
grievance committee shall consist of five (5) persons. The Claims Administrator Staff and Plan
Medical Director shall be ex-officio and non-voting members of the committee. Each party to
the complaint and/or their representative shall be heard by the grievance committee. Each party
may present their case as to why the original decision was rendered and why that decision should
be sustained or rejected. Upon conclusion of the presentation or arguments, the grievance
committee shall have seven (7) days in which to deliberate and issue their recommendation to the
City or its designated agent. If the claimant so requests, he or she will be provided, free of
charge, reasonable access to, and copies of, all documents, records, and other information
relevant to the Claim.
The period of time within which a benefit determination on review is required to be made shall
begin at the time an appeal is filed in accordance with the procedures of the Plan. This timing is
without regard to whether all the necessary information accompanies the filing.
A document, record, or other information shall be considered relevant to a Claim if it:
(1) Was relied upon in making the benefit determination;
(2) Was submitted, considered, or generated in the course of making the benefit
determination, without regard to whether it was relied upon in making the benefit
determination;
(3) Demonstrated compliance with the administrative processes and safeguards designed
to ensure and to verify that benefit determinations are made in accordance with Plan
documents and Plan provisions have been applied consistently with respect to all
claimants; or
(4) Constituted a statement of policy or guidance with respect to the Plan concerning the
denied treatment option or benefit.
The review shall take into account all comments, documents, records, and other information
submitted by the claimant relating to the Claim, without regard to whether such information
was submitted or considered in the initial benefit determination. The review will not afford
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deference to the initial adverse benefit determination and will be conducted by a fiduciary of
the Plan who is neither the individual who made the adverse determination nor a subordinate
of that individual.
If the determination was based on a medical judgment, including determinations with regard
to whether a particular treatment, drug, or other item is Experimental, Investigational, or not
Medically Necessary or appropriate, the fiduciary shall consult with a health care
professional who was not involved in the original benefit determination. This health care
professional will have appropriate training and experience in the field of medicine involved
in the medical judgment. Additionally, medical or vocational experts whose advice was
obtained on behalf of the Plan in connection with the initial determination will be identified.
External Review
The external review entity shall be an entity certified as meeting the criteria established by
the Iowa Insurance Division. The Plan will adhere to the rules adopted by the Iowa Insurance
Division, and as maybe amended from time to time, regarding external reviews.
In order to be eligible for external review: (1) the covered Participant must have been
covered at the time the service or treatment was proposed; (2) the covered Participant must
have been denied coverage based on a determination by the Plan Administrator and that the
proposed services or treatment does not meet the definition of medical necessity; and (3) the
covered Participant or the covered Participant's treating provider acting on behalf of the
covered Participant, must have exhausted all internal appeal mechanisms provided under this
Plan Document and Summary Plan Description.
In order to request an external review, the covered Participant or the covered Participant's
treating health care provider must send a request for an external review within 60 days of
receipt of the final coverage decision from the Plan to the Division of Insurance, 330 Maple
Street, Des Moines, IA 50319. The covered Participant (or the covered Participant's health
care provider) must include with his/her request for external review a copy of the Plan's
denial and a check or money order in the amount of $25 made payable to the Iowa Insurance
Division. (The $25 fee may be waived upon request. If a waiver of the filing fee is being
requested, an explanation of why the covered Participant is requesting such a waiver should
be included.)
Upon receipt of the request for external review, the Insurance Division shall certify that the
Participant meets the criteria established under 1999 Iowa Act, Senate File 276, Section 11.
The Insurance Division will certify or deny the request and notify, in writing, the covered
Participant, the covered Participant's treating health care provider (if applicable) and the
Plan, within 2 business days from the receipt of a request for external review. The Plan may
contest the eligibility of the request for external review with the Insurance Division. Any
contest of the decision must be made within 3 business days of the Insurance Division's
decision. The Insurance division shall have 2 business days to rule on the contested eligibility
for external review and will notify, in writing, the covered Participant's treating health care
provider (if applicable) and the Plan of their final decision.
An expedited review conducted by an external review entity is available when the covered
Participant's health care provider feels that a delay would pose imminent or serious threat to
the covered Participant. To request an expedited review, the covered Participant's treating
health care provider must contact the Plan and specifically request an expedited review. The
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covered Participant's treating health care provider and the Plan shall select an independent
review entity to conduct the external review within 72 hours. In the event that a joint
agreement on the selection of the independent review entity cannot be made, the covered
Participant's treating health care provider shall notify the Insurance Division, who shall
select an independent review entity. The covered Participant's treating health care provider
shall notify the Insurance Division of the expedited review request following selection of the
independent review entity. If the Plan does not feel that the request meets the criteria to
cause an expedited review, the Plan can request the Insurance Division to immediately
review the request and certify or deny the request as an expedited review. The covered
Participant's treating health care provider and the Plan shall provide any additional medical
information to the independent review entity.
The independent review entity shall immediately notify the Plan, the covered Participant, the
covered Participant's treating health care provider and the Insurance Division of the external
review decision.
6.) Page 45 deleting the section under the Heading Continuation of Coverage during
Military Leave and replacing with following:
It is the intent of the Plan to fully comply with the Uniformed Services Employment Act of
1994 (USERRA). If any part of this Plan is found to be in conflict with this Act, the
conflicting provision shall be null and void. All other benefits and exclusions of the Plan
will remain effective to the extent there is no conflict with this Act.
USERRA provides for continuation of health coverage to a covered employee and covered
Dependents during a period of active services or training with any of the Uniformed
Services. A covered employee may elect to continue coverage in effect at the time the
employee is called to active service as follows:
1. The maximum period of coverage of a person under such an election shall be the
lesser of:
a. The 18 month period beginning on the date on which the person's absence
begins prior to December 10, 2004 or the 24-month period beginning on the
date on which the person's absence begins on or after December 10, 2004; or
b. The period beginning on the date on which the covered employee's absence
begins and ending on the day after the date on which the covered employee's
absence begins and ending on the day after the date on which the covered
employee fails to apply for or return to a position of employment as follows:
i. for service of less than 31 days, no later than the beginning of the
first full regularly scheduled work period on the first full
calendar day following the completion of the period of service
and the expiration of eight hours after a period allowing for the
safe transportation from the place of service to the covered
employee's residence or as soon as reasonably possible after
such eight hour period;
ii. for service of more than 30 days but less than 181 days, no later
than 14 days after the completion of the period of service or as
soon as reasonably possible after such period;
iii. for service of more than 180 days, no later than 90 days after the
completion of the period of service.
iv. for a covered employee who is hospitalized or convalescing from
an illness or injury incurred in or aggravated during the
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performance of service in the uniformed services, at the end of
the period that is necessary for the covered employee to recover
from such illness or injury. Such period of recovery may not
exceed two (2) years.
2. A Covered Person who elects to continue health plan coverage may be required to
pay up to 102% of the full contribution under the Plan, except a person on active duty
for 30 days or less cannot be required to pay more than the Employee's share, if any,
for the coverage.
3. Apre-existing exclusion (if applicable) and/or Waiting Period may not be imposed in
connection with reinstatement of coverage upon reemployment if one would not have
been imposed had coverage not been terminated because of service. However, the
waiver of the pre-existing exclusion (if applicable) shall not apply to illness or injury
which occurred or was aggravated during performance of service in the uniformed
services.
4. Continuation cannot be discontinued merely because activated military personnel
receive health coverage as active duty members of the Uniformed Services, and their
family members are eligible to receive coverage under the Military Health System,
TRICARE.
"Uniformed Services" shall include fulltime and reserve components of the United States
Army, Navy, Air Force, Marines, Coast Guard, Army National Guard, the commissioned
corps of the Public Health Service and any other category of persons designated by the
President in time of war or emergency.
Covered Employees called to a period of active service in the Uniformed Service are
encouraged to check with the Plan Administrator for a more complete explanation of
your rights and obligations under USERRA.
7.) Page 47 Under FUNDING THE PLAN AND PAYMENT OF BENEFITS section
delete "or Employee and Dependent Coverage: Funding is derived solely from the
funds of the Employer", effective July 1, 2005; and replaced with:
"For Employee and Dependent Coverage: Funding is derived from contributions from
both the Employee and Employer".
Accepted:
City of Dubuque ~,/
B ~GV'` ~
Y•
Date:
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