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Pensions and Benefits
SCHOOL EMPLOYEES' HEALTH BENEFITS COMMISSION
MEETING MINUTES 2008

School Employees’ Health Benefits Commission
Minutes, Meeting No. 1
September 16, 2008, 10:00 AM

The meeting of the School Employees’ Health Benefits Commission (Commission) was called to order at 10:25 AM, Tuesday, September 16, 2008. The meeting was held at the Division of Pensions and Benefits (Division), 50 West State Street, Trenton, New Jersey. 

Rubin Weiner gave a summary of how the meeting would be conducted.  A chairperson would need to be nominated for the day until a permanent chairperson is selected. Wendell Steinhauer nominated Robert Peden. Cynthia Jahn seconded the nomination. All voted in favor.

ROLL CALL

The meeting was attended by the following members of the Commission and Division staff.

Joseph Del Grosso, representing the AFL-CIO
Thomas Gallagher, representing Commissioner, Steven M. Goldman, Department of Banking & Insurance
James Geiger, representing the NJEA
Cynthia Jahn, representing the NJ School Board Association
Kevin Kelleher, representing the NJEA
Robert Peden, representing State Treasurer, R. David Rousseau
Richard Quinn, representing a New Jersey Resident
Wendell Steinhauer, representing the NJEA

ALSO PRESENT: 

Eileen Den Bleyker, Deputy Attorney General
Rubin Weiner, Deputy Attorney General
Florence J. Sheppard, Deputy Director
Jean Williamson, Acting Secretary
David Pointer, Manager, Policy, Planning and Operations
Edward Fox, Aon Consulting
James Christ, Aon Consulting
Kristine Klepper, Aon Consulting
Susan Marsh, Aon Consulting

Deidre Webster-Cobb, Esq., Director Division of Contract Compliance & EEO in Public Contracts, conducted Ethics training beginning at 10:25 AM. She provided a copy of the Uniform Ethics Code to all of the commissioners.  Commissioners were asked to sign the Acknowledgement Form to confirm receipt of the Uniform Ethics Code; signed forms were returned and placed on file.

David Pointer, Manager, Policy, Planning and Operations, gave an overview and explained the highlights of the Federal Health Insurance Portability and Accountability Act of 1996 (HIPAA).

Commission recessed for lunch at 11:40 AM. 

Chairman Peden reconvened the meeting in public session at 1:03 PM.

ISSUES

Edward Fox, Aon Consulting, gave an introduction and general overview of the 2009 rates.  Susan Marsh, Aon Consulting, gave an overview of the 2009 Rate Recommendations for Medical and Prescription Drugs for the Active Employees and Retirees of the School Employees Health Benefits Program (SEHBP).  Also present from Aon Consulting were James Christ and Kristine Klepper. The following is a summary from Aon Consulting:

Recommended Plan Year 2009 Medical/Rx Rate Renewal
For Active Employees and Retirees
____________________________________________________________

  • For Plan Year 2009, Aon is recommending premium rate changes that – in the aggregate – represent an overall increase of 4% for SEHBP Active Employees and Retirees:

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  • This recommended renewal assumes:
    • Aetna Medicare HMO coverage for medical claims will change from an ASO program which supplements Medicare to a fully-insured Medicare Advantage program;
    • Premium Rates for overage dependents (as of 1/1/2009, this is defined as children under age 31) will be reduced from 110% of the Single Employee rate to 41% of the Single Employee rate in compliance with new State Law;
    • No other changes in Employee or Retiree benefits; and
    • SEHBP Employee enrollment will increase 1.1% in Plan Year 2009, in continuation of the increases in enrollment in Plan Year 2008; and
    • SEHBP Retiree enrollment will increase 5.5% in Plan Year 2009, in continuation of the 5-6% increases over the past five years.
  • Aggregate differences in the rate changes for different benefit plans and between Actives and Retirees reflect the impact of:
    • Medicare Retiree medical trends have been below 5% in each of the past two years – much lower than industry norms, and we are projecting that the low trend levels will continue into Plan Years 2008 and 2009.
    • Historically, Early Retiree HMO rates were pooled with Active HMO rates to develop premiums.  Since there are now over 3,000 SEHBP Retirees enrolled in HMOs, the Plan Year 2009 Renewal Rates were adjusted to partially reflect the higher level of claim costs attributable to Early Retirees;
    • HMO claim trends have averaged about 3% higher than Horizon trends over the most recent two years of experience, and we are projecting that HMOs will continue to trend at a higher rate than the Horizon plans.
  • Factors contributing to the overall favorable rate actions include:
    • Favorable experience for Plan Year 2007 and favorable experience projected for Plan Years 2008 and 2009;
    • Benchmark trends have decreased 1.5% for medical and 3% for Rx over the past two years; and
    • The new benefit landscape effective April 1, 2008, with the new PPO plans replacing NJ PLUS and the Traditional Plan, as well as a reduction in the number of HMOs from 5 to 2, resulted in lower overall State Health Benefits Program (SHBP) costs due to improved provider discounts, greater rebates, reduced vendor administrative fees, and an overall increase in managed care.
    • Introduction of Aetna’s Medicare Advantage program.
  • The premium levels for Plan Year 2009 are projected to result in a $45 million loss, which will reduce the SEHBP claim stabilization reserve to $389 million.  This is equivalent to 3.4 months of claims, which exceeds the target reserve of 3.0 months of claims.

The Commissioners asked a number of questions concerning the rate report.  Several questions that could not be answered during the meeting will be followed up and answered prior to the next meeting.  The questions included:

  • How many retirees reach the out-of-pocket maximum for prescription drug plan?  Of those who do not reach the out-of pocket maximum, what is the average number of prescriptions?
  • How many members were auto-converted to NJ DIRECT15 when the plans changed on April 1, 2008?  How many voluntarily took NJ DIRECT15?
  • What is the comparison of prescription drug co-payments and out-of- pocket maximum amounts as well as other areas of difference between the SHBP and the SEHBP?
  • What is the breakdown of who pays for retirees?
  • What would the cost be for coordination of benefits between NJ DIRECT10 and NJ DIRECT15?

The Division was asked to provide a copy of a survey from Mercer Consultants concerning prescription drug copayments.

Aetna representatives were available and answered questions concerning the Medicare Advantage Plan that was being considered by the Commission.

The commission was advised that the rates must be finalized before the annual open enrollment for active employees in October. They were also asked to direct written questions concerning the rates to Jean Williamson via e-mail.

Robert Peden requested nominations for the chairperson to be recommended to Governor Corzine. The Commission nominated Hope Cooper, Jane Oates and Robert Garrenger III.  Robert Peden made a motion to approve the nomination list and send to the Governor’s office. Thomas Gallagher seconded the motion. All voted in favor. 

The issue of promulgating regulations for the SEHBP was raised. Susanne Culliton, the regulatory officer for the Division, indicated that the State Health Benefits Program (SHBP) regulations will expire on October 9, 2008. The State Health Benefits Commission is reviewing and preparing to adopt the regulations prior to their expiration date. The SHBP regulations are to be used by the SEHBP until their own regulations are adopted. The Commission requested that an update on the SHBP regulations be put on the agenda as a standing item.

I announced that the next School Employees’ Health Benefits Commission would be held on Tuesday, September 23, 2008 @ 10:00 AM. 

There being no further business, Robert Peden made a motion to adjourn, which was seconded by James Geiger. All voted in favor. The School Employees’ Health Benefits Commission meeting was adjourned at 2:51 PM.

Respectfully submitted,


Jean M. Williamson, CEBS
Acting Secretary
School Employees’ Health Benefits Commission

 


School Employees’ Health Benefits Commission
REVISED Minutes, Meeting No. 2
September 23, 2008; 10:00 AM

The meeting of the School Employees Health Benefits Commission (Commission) was called to order at 10:04 AM, Tuesday, September 23, 2008. The meeting was held at the Division of Pensions and Benefits, 50 West State Street, Trenton, New Jersey.

Jane Oates introduced herself as the chairperson for the School Employees’ Health Benefits Commission and indicated that she would be abstaining from voting since she was not notified of her appointment until the previous evening.

ROLL CALL

The meeting was attended by the following members of the Commission and Division staff:

Jane Oates, Chairperson
Joseph Del Grosso, representing the AFL-CIO
Thomas Gallagher, representing Commissioner, Steven M. Goldman, Department of Banking & Insurance
James Geiger, representing the NJEA
Cynthia Jahn, representing the NJ School Board Association
Kevin Kelleher, representing the NJEA
Robert Peden, representing State Treasurer, R. David Rousseau
Richard Quinn, representing a New Jersey Resident
Wendell Steinhauer, representing the NJEA

Also present: 

Eileen Den Bleyker, Deputy Attorney General
Rubin Weiner, Deputy Attorney General
Frederick J. Beaver, Director, Pensions and Benefits
Florence J. Sheppard, Deputy Director
Jean Williamson, Acting Secretary
David Pointer, Manager, Policy, Planning and Operations
Edward Fox, Aon Consulting
James Christ, Aon Consulting
Kristine Klepper, Aon Consulting
Susan Marsh, Aon Consulting

ISSUES

Edward Fox, Aon Consulting, addressed the Commission members and asked if there were any additional questions that were not answered in the e-mails. Aon Consulting responded to all of the follow-up questions concerning the 2009 Rates from the September 16, 2008 Commission meeting prior to the meeting. E-mails of those responses were forwarded to the Commission members and hard copies were available for them at the meeting. 

Wendell Steinhauer made a motion to approve the 2009 Rates for Active School Employees. James Geiger seconded the motion. Failed. (Vote 4: 4: 1; Commissioners Gallagher, Jahn, Peden and Quinn: nae and Jane Oates abstained).

Cynthia Jahn made a motion to approve all rates as presented. Jane Oates seconded the motion. Failed (Vote 3: 5: 1; Commissioners Steinhauer, Kelleher, Geiger, Quinn Del Grosso voted nae and Jane Oates abstained).

Florence Sheppard advised the commission that any changes made to copayments will cause adjustments in the rates.  Susan Marsh indicated that the Commission could propose no increase in copayments and increase rates by a percentage. 

Wendell Steinhauer made a motion to approve all rates with the exception of increase to the retiree prescription drug plan and use the reserve for increases. Frederick Beaver said that the SEHBC may not have the authority to do that.  Commissioner Steinhauer withdrew motion.

Wendell Steinhauer made a motion to approve the rates with the exception of freezing the retiree prescription drug plan copayments at the current level but not the out-of-pocket maximum. James Geiger seconded the motion. Failed (Vote 4: 4: 1; Commissioners Jahn, Gallagher, Peden and Quinn voted nae. Commissioner Oates abstained)

Commissioner Oates asked what the deadline was on the rates. Director Fred Beaver advised that open enrollment for employee begins on October 1, 2008. Wendell Steinhauer asked how much the out-of-pocket prescription drug maximum would need to be raised to keep the proposed rates for 2009. Jane Oates made a motion to recess for a fifteen minute break. James Geiger seconded the motion. All voted in favor. The Commission reconvened at 11:55 AM after a brief recess. During the recess, Aon Consulting met to determine the amount that the out-of-pocket maximum would need to increase to keep the rates as proposed for 2009.

Wendell Steinhauer made a motion to approve all rates with the exception of retiree’s Rx co pays maintain at 2008 rates and increase the out-of-pocket maximum by $48 to $1,130 for NJ DIRECT and the HMO’s. Kevin Kelleher seconded the motion. Approved (Vote 7: 1: 1; Commissioner Quinn voted nae. Commissioner Oates abstained). 

Commissioner Oates recommended planning a schedule for future meetings. Commissioner Geiger recommended that the Commission meet on a monthly basis beginning in October. Commission Oates indicated that a standing date and week of the month be established for the regular monthly meetings.

There being no further business to transact, a motion was made to adjourn by Wendell Steinhauer, seconded by Joseph Del Grosso. All voted in favor. The School Employees’ Health Benefits Commission meeting was adjourned at 12:04 PM.

Respectfully submitted,


Jean M. Williamson, CEBS
Acting Secretary
School Employees’ Health Benefits Commission

 

 

 

 

 


School Employees’ Health Benefits Commission
Minutes, Meeting No. 3
October 29, 2008; 10:00 AM

The meeting of the School Employees’ Health Benefits Commission was called to order at 10:05 AM, Wednesday, October 29, 2008. The meeting was held at the Division of Pensions and Benefits, 50 West State Street, Trenton, New Jersey.

ROLL CALL

The meeting was attended by the following members of the Commission and Division staff:

Jane Oates, Chairperson
Thomas Gallagher, Commissioner, representing Commissioner Steven M. Goldman, Department of Banking & Insurance
James Geiger, Commissioner
Cynthia Jahn, Commissioner
Kevin Kelleher, Commissioner
Robert Peden, Commissioner, representing State Treasurer R. David Rousseau
Richard Quinn, Commissioner
Wendell Steinhauer, Commissioner

Also present: 

Eileen Den Bleyker, Deputy Attorney General
Rubin Weiner, Deputy Attorney General
Florence J. Sheppard, Deputy Director, Pensions and Benefits
Jean Williamson, Acting Secretary
David Pointer, Manager, Policy, Planning and Operations, Pensions and Benefits
Barbara Scherer, Pensions and Benefits
Horizon Representatives

Absent:

Joseph DelGrosso, Commissioner

Resolutions A (Closed Session) and B (Executive Session) – were read in their entirety.

Minutes – Meeting No. 1, September 16, 2008 and Meeting No. 2, September 23, 2008. Wendell Steinhauer made a motion to accept the minutes with the changes to page two of the September 23, 2008 minutes. Cynthia Jahn seconded the motion. Approved (Vote 8: 0: 0).
           
ISSUES

Health Plan Updates (Quarterly) - FYI
Commissioner Oates stated that the Commission had requested the updates be on a monthly basis. Florence Sheppard advised the Commission that there are not always issues every month with the Health Plans; she suggested that updates should be quarterly. The Commission wants to be made aware of issues that might change the health plans in the future. The Commission requested that they be notified of hospital terminations.  

SHBP Regulations - FYI
The Commission asked what the process is for developing the regulations for the SEHBP. Commissioner Kelleher suggested that a meeting be scheduled to discuss the regulations. Joan Oates made a motion to meet on December 15, 2008 at 1:00 PM to discuss the draft regulations for the SEHBP. Cynthia Jahn seconded the motion. Approved (Vote 7: 0: 0).

Proposed 2009 Meeting Dates - For Approval
Wendell Steinhauer motioned to approve the 2009 meeting dates. Richard Quinn seconded the motion. Approved (Vote 8: 0: 0).

Commissioner Oates motioned to go into closed session under Resolution A. Richard Quinn seconded the motion. Approved (Vote 8: 0: 0).

The following cases due to HIPAA regulations are seen in closed session, with motions and voting done in closed session.

Case# SE100801 – This NJ DIRECT 10 appeal concerned a denial of benefits for prior authorization of In Vitro Fertilization (IVF) treatment beyond the maximum age of up to forty-six years of age. Commissioner Oates asked if the age limit was the only change with the IVF benefit.  Commission members were directed to the IVF policy differences that were included on a chart in the Commission books. Commissioner Quinn asked what notification was given to members of the change in the benefit when it became effective April 1, 2008. David Pointer responded that the change is in the NJ DIRECT Member Handbook. Commissioner Quinn asked if there is any indication that IVF treatment started prior to April 1, 2008.  Dr. Yee said she was being treated (with estrogen) for menstrual disorders and menopausal related issues not Assisted Reproductive Technology (ART). Wendy Burns stated that the member was on estrogen for several years. The member called Horizon on March 24, 2008 to inquire about IVF and was told she would not be eligible. The provider had called in February and was told the benefit was available under NJ PLUS. Commissioner Kelleher stated that Chapter 103, P.L. 2007 said that the benefits shall be the same as of July 1, 2007 and asked if that law overrides any change in benefits. Kevin Kelleher made a motion to go into Executive Session under Resolution B. Wendell Steinhauer seconded the motion. All voted in favor. Upon return to closed session, Commissioner Quinn asked about prior authorization for the IVF treatment. Wendy Burns said that the record states that the IVF treatment was to begin on June 1, 2008. Richard Quinn asked if there is anything to indicate that IVF had begun prior to April 1, 2008. Wendy Burns indicated again that the member was on estrogen. Dr. Yee stated that in January 2008 the member was being treated for another medical condition and that as of February 12, 2008 she could not have been starting IVF because the office notes show that she was in treatment for another condition. Robert Peden asked if prior authorization was required for estrogen.  Wendy Burns indicted that it is not. Commission Oates said that Dr. Check’s letter says the member was on estrogen on February 12, 2008. The letter from Dr. Check stated that he had started her on estrogen in preparation for a near future donor egg cycle. Dr. Yee noted a medical problem in her uterus. He stated they were looking for cancer in January and February; in the notes that is the reason for the biopsy. Commissioner Oates stated that in a letter to Governor Corzine the member referred to other people receiving letters advising them of the change in the benefit and indicated she did not receive a letter. Commission Oates asked if Horizon sent those letters out, and, if so, why didn’t the member receive a letter.  Wendy Burns responded that yes, Horizon sent letters in March 2008 to members who had IVF attempts in the past to advise them of the change.  Kevin Kelleher made a motion to approve the appeal for infertility treatment because she  started it prior to April and grandfather her under the old plan. Wendell Steinhauer seconded the motion. Approved (Vote 5: 3: 0 Commissioners Gallagher, Peden and Quinn: nay).

Case# SE100802 – This Division appeal (NJ DIRECT10) concerned a request to continue enrollment for the member’s daughter as an overage disabled dependent. Commissioner Geiger asked if Horizon is disputing that the child is disabled.  Wendy Burns stated that Horizon does not dispute the medical eligibility. David Pointer indicated that the reason for the denial is that a different address was given for the dependent, and the regulations indicate that the overage dependent must meet the definition of dependent which requires residing with the parent. James Geiger made a motion to go into Executive Session under Resolution B. Jane Oates seconded the motion. All voted in favor. Upon return from Executive Session, Horizon representatives were asked if there is coordination of benefits with Medicaid. Wendy Burns responded that there is no coordination of benefits with Medicaid; we would be the primary insurance. James Geiger made a motion to approve this appeal. Wendell Steinhauer seconded the motion. Approved (Vote 5: 3: 0 Commissioners Jahn, Peden and Quinn: nay).

There being no further appeals, a motion was made to return to open session by Jane Oates, seconded by Richard Quinn.  All voted in favor.

There being no further business to transact, a motion was made to adjourn by Jane Oates, seconded by Richard Quinn. All voted in favor. The School Employees’ Health Benefits Commission meeting was adjourned at 11:42 AM.

Respectfully submitted,


Jean M. Williamson, CEBS
Acting Secretary
School Employees’ Health Benefits Commission

 

 

 

 


School Employees’ Health Benefits Commission
Minutes, Meeting No. 4
December 15, 2008; 1:00 PM

The meeting of the School Employees’ Health Benefits Commission (Commission) was called to order at 1:05 PM, Monday December 15, 2008. The meeting was held at the Division of Pensions and Benefits, 50 West State Street, Trenton, New Jersey.

ROLL CALL

The meeting was attended by the following members of the Commission and Division staff:

Jane Oates, Chairperson
Joseph Del Grosso, Commissioner
Thomas Gallagher, Commissioner, representing Commissioner Steven M. Goldman, Department of Banking & Insurance
James Geiger, Commissioner
Cynthia Jahn, Commissioner
Kevin Kelleher, Commissioner
Robert Peden, Commissioner, representing State Treasurer R. David Rousseau
Richard Quinn, Commissioner
Wendell Steinhauer, Commissioner

Also present: 

Eileen Den Bleyker, Deputy Attorney General
Rubin Weiner, Deputy Attorney General
Frederick J. Beaver, Director, Pensions and Benefits*
Florence J. Sheppard, Deputy Director, Pensions and Benefits
Jean Williamson, Acting Secretary
David Pointer, Manager, Policy, Planning and Operations, Pensions and Benefits
Barbara Scherer, Pensions and Benefits
Horizon Representatives
Aetna Representatives
* Present for part of the meeting

Minutes – Meeting No. 3, October 29, 2008. Jane Oates made a motion to go into Executive Session under Resolution B. Robert Peden seconded the motion. Approved (Vote 9: 0: 0). Upon return from Executive Session, Jane Oates made a motion to table the minutes until the next meeting to clarify the changes. Wendell Steinhauer seconded the motion.  Approved (Vote 8: 0: 1: Commissioner DelGrosso abstained).

ISSUES

State Health Benefits Commission (SHBC) authorization to prepare a Request for Proposals (RFP) for prescription benefits management services – David Pointer explained to the Commission that the SHBC authorized preparation of a RFP for prescription benefits management (PBM) services. Kevin Kelleher asked if the proposal was for both the State Health Benefits Program (SHBP) and the School Employees’ Health Benefits Program (SEHBP). Jane Oates asked what the Commission’s role is in the preparation of the RFP. David Pointer referred the questions to DAG Den Bleyker. DAG Den Bleyker said that she would be drafting a Memorandum of Understanding (MOU) between the two Commissions to detail the cooperation. At this point in time all existing contracts are held by the SHBC. Each Commission has statutory authority to enter contracts and the MOU would finalize and clarify how it will work. Kevin Kelleher asked if the Commission would be able to see the RFP beforehand. He also asked if there is a comment period for this Commission and the ability to make modifications. DAG Den Bleyker said that the contract is a SHBC contract and the SEHBC’s participation needs to be worked out in the MOU. Jane Oates asked if the details of the MOU were discussed by the SHBC. Fred Beaver responded no. Jane Oates indicated that the SEHBC wants to be a part of the RFP process and asked for the timeline. James Geiger asked why do a RFP. Fred Beaver said the purpose is greater savings to participants and taxpayers. Mr. Geiger also asked why there is no dental RFP. David Pointer responded that there is a contract in place. Frederick Beaver advised the Commission that there is no direct contract for the Prescription Drug Plan.

Health Insurance Portability and Accountability Act Exemption – FYI
David Pointer advised the Commission that the SHBC approved the filing of an exemption at its November 18, 2008 meeting. Kevin Kelleher questioned the annual limitation of $10,000.00 stated in the memo from Fred Beaver. It was found to be in error; the correct amount is $15,000.00. 

Aetna Medicare Open Plan – FYI
Kevin Kelleher said that the Commission was told there would be no benefit changes as a result of implementation of the Aetna Medicare Open Plan. He indicated that was not the case. Katherine Impellizzeri, Peter McClung and Eric Cormier from Aetna were present to respond to the questions. Below is a copy of a document containing Aetna’s written responses to Mr. Kelleher’s questions. The document was distributed to Commission members via e-mail prior to the meeting on December 8, 2008.

Aetna Medicare Open plan, a Private Fee for Service Program for Medicare eligible retirees enrolled in Aetna Select EPO.

In conjunction with the renewal of the Aetna HMO contract with the SHBP and SEHBP, Aetna proposed the Aetna Medicare Open Private Fee for Service Program as a replacement in a majority of service areas without network issues as a means for the State to reduce expenses and provide a greater benefit modeled on the existing Aetna Select product offered to the Medicare Eligible retirees.

The proposal included offering the Aetna Medicare Open Private Fee for Service program for approx. 7,900 of 8,900 Aetna enrolled Medicare eligible retirees, while keeping Medicare eligible retirees in selected counties in PA, NC, FL and TX in the Aetna Select platform, so that all members would have access to their existing physicians and hospitals.

QUESTION ONE: NETWORK – I remember Aetna reporting that ALL doctors and hospitals that are currently used by Aetna HMO members would be in the Fee for Service plan. It is my understanding that this is not true and while some may, others may not.  An example is the University of Pennsylvania Health System which participates in the HMO and Medicare, but not the Fee for Service plan.

RESPONSE ONE:  NETWORK - The Medicare Open Plan does not currently have a network contract in place with physicians, based on rules for the program given by CMS. Physicians deem acceptance to the policies of the plan by billing Aetna for service provided. Certain providers have indicated that they will not deem general acceptance of the product. The national results of non-deemed providers are approximately 2% of total providers. However, in our area, this includes the University of PA Health System. The Health System has however granted certain exceptions to the policy when reviewing certain existing patient situations. 

Due to this issue, Aetna originally proposed keeping the Aetna Select program in place, so that members affected by providers that would not deem into the product, could continue to access their provider by either staying in or transferring to the Aetna Select program (currently in place), which is a supplemental program to the Original Medicare plan. This was the process described at the Commission meeting, where members that may have a network difficulty could transfer back to the Aetna Select plan, thus not having network disruption.

After the approval by the Commissions of the renewal, Aetna and the Division of Pensions and Benefits set to work implementing the Aetna Medicare Open Plan and the Aetna Select programs to work in tandem. The original proposal had assumed the inclusion of a service ID generated by the Division in the eligibility records sent to Aetna to designate which product the member was enrolled in, either Aetna Select or Aetna Private Fee for Service.   

However, once the installation process was initiated, the viability of a service ID for the new product was not available, in part due to the time needed to set up this arrangement.  This meant that the original approach of having the Aetna Select as a “back-up” for network issues was no longer viable.

While the original proposal gave service areas that would have been excluded, Aetna and the Division discussed various solutions that would ensure that enrolled members could still access their physicians and hospitals.  Since not all members within an originally excluded service area (like PA), utilize services at a non-deemed provider, some individuals were being excluded, even when their providers were not affected. It was decided to continue, but provide additional outreaches and communications to potential impacted members.

Initial Outreach:  All members with utilization at the University of PA within the past 12 months were mailed a letter highlighting that the system does not participate in the program. Letters also were mailed to all retirees within the states of Texas, North Carolina, and Florida.  By sending notifications to retirees in the entire state, Aetna tried to send information to a broader group of retirees, even those not affected by non-deemed providers.

Secondary Outreach:  Members with at least $100 dollars of paid claim expense at the University of PA were reached out to by phone in an outbound phone campaign to discuss the situation with each member and discuss the alternative plans (Horizon and Cigna) that the member could enroll into if continuing at the University of PA Hospital and Medical System were needed. 

Additional and ongoing support:  All members have the option to opt out of the Aetna program and were given information on their rights to opt out and how to do that through the material sent by Aetna and approved by the Division.  While the opt out process was defined as a selection by December 1st, the Division will continue to allow opt outs, outside of the 12 month plan selection period afforded to retirees.

For Members that identified themselves to Aetna as cases that warranted exceptions with the University of PA, Aetna coordinated exceptions directly with the University of PA for those members, so that they could continue in the Medicare Open plan with University of PA Health System.

Educational sessions for all were given, which were used to educate all retirees of the program changes, as well as the unique nature of the University of PA system issues. 

Aetna also set up an exclusive toll free number for State of New Jersey and Educational System retirees to contact during the period and their enrollment.

Aetna’s goal in the implementation and ongoing administration is to maintain and expand access to providers through the Medicare Open Private Fee for Service product.  As the product is set up by CMS today, members will receive additional access to providers they did not have access to in the existing product, Aetna Select. 

Also, Congress recently passed legislation that requires the Medicare Open Private Fee for Service program to incorporate in contracted networks by 2011. Aetna is already progressing towards that goal, and with significant Medicare Advantage program presence in NJ, PA, NY and DE through our existing Medicare HMO and Medicare PPO, which are both contracted products, we fully expect provider contracting to be completed before that time.

QUESTION TWO:  MEDICARE A AND B - I do not remember Aetna reporting that ALL Medicare eligible retirees enrolled in Aetna would be un-enrolled in Medicare at the federal level and Aetna would now be both primary and secondary. In addition, even those members with Horizon Direct as primary would be un-enrolled in Medicare.

RESPONSE TWO:  MEDICARE A AND B – Individuals enrolled in Medicare Advantage programs are still enrolled in Medicare Parts A & B of the program. Once a Medicare enrolled individual elects a Medicare Advantage program, the member is transferred by CMS to the Medicare Advantage plan. Benefits provided under the program are provided by the Medicare Advantage program. 

For dual-coverage retirees, that previously had coverage through Original Medicare (www.medicare.gov), then dual HMO/PPO programs that supplemented the Original Medicare, claims when originally to Medicare for payment, then were sent to the primary plan, then the secondary HMO by the retiree. Typically the secondary HMO would only pay for applicable co-payments or small percentage increase to 100%, and only if the providers utilized were in both programs.    In order to receive a benefit from the secondary HMO, the plan member would have had to receive services from an HMO PCP, receive appropriate referrals, and access in-network facilities. Under the Medicare Open Plan, these requirements are eliminated, designed to make it easier for retirees to access the plan.

Retirees enrolled in Aetna’s Medicare Open Private fee for Service program have a plan design at 100% minus certain co-payments.  Retirees will receive services from a provider, then the bill will be submitted to Aetna for payment up to the benefit level.  The remainder will typically be a co-payment, which can be submitted to coordinating plan. The “Original Medicare” plan is replaced by the Medicare Advantage plan.

QUESTION THREE:  BENEFIT LEVEL- I remember Aetna reporting that there would be no reduction in benefit and in some cases there would be benefit enhancements.  It is my understanding that there are some benefits that would change and give some members a lesser benefit.  The two areas that I have heard are Skilled Nursing and Mental Health.

RESPONSE THREE:  BENEFIT LEVEL – The benefits proposed to the Division to replace the Aetna Select program, do actuarially exceed the benefits provided currently. Also, a line-by-line analysis has been completed by Aetna and the Division to ensure that the benefits provided match or exceed the existing benefits.

The Skilled Nursing Benefit referenced currently has a 120 day calendar year limit.  While the Skilled Nursing Benefit referenced in the Private Fee for Service program states it is 100 days – it is 100 days per benefit period, rather than calendar year.  Medicare Advantage plans follow the Medicare definition of benefit period, in which there can be multiple benefit periods in a specific year. This means that the member has the opportunity to have in excess of the 120 day calendar year limit under the new PFFS plan.

The mental health benefits exceed the current levels, since the calendar year maximums have been taken away.  Currently there is a limit of 25 days per calendar year on non-biologically based Inpatient Mental Illness. There is no calendar year maximum under the new plan. For Outpatient Mental Illness, there is an existing calendar limit of 30 days for non-biologically based service. This is eliminated under the new plan. Substance abuse limits per calendar year in the existing plan are also eliminated. 

There is a Medicare 190 day lifetime limit for inpatient services in a psychiatric hospital. The 190-day limit does not apply to mental health services provided in a psychiatric unit in a general hospital.

Benefit enhancements include:

  • No Primary Care Physician selection required
  • No referrals required
  • Single claim payment from Aetna, rather than coordination between Original Medicare and supplement plans.
  • No copay for Routine Physical Examinations
  • No copay for Routine GYN exams
  • Non-Urgent use of Urgent Care Provider now covered
  • No calendar year limit on visits for outpatient short term therapy
  • No calendar year limit on visit to a chiropractor
  • Durable Medical Equipment covered at 100% without deductible.

QUESTION FOUR: CHANGE IN PRIMARY COVERAGE – I do not remember Aetna reporting on this, but if true, should have been told to the Commission before a vote was taken to accept the change. Supposedly, anyone that has Medicare and is enrolled in the Aetna Fee for Service plan (either as a member or as a dependent) MUST use the Aetna Fee for Service plan as their primary insurance.         

Situation:  A member that is enrolled in a Horizon Direct plan as their primary insurance and the Aetna Fee for Service plan as secondary is now forced to use the Aetna Fee for Service as primary.  The member does not use an Aetna Fee for Service facility, but a Medicare facility, such as University of Pennsylvania Health System.  My understanding is that:

  • Aetna Fee for Service does not pay because they were not a Fee for Service facility;
  • Medicare does not pay because the member is not “enrolled” in the Medicare program;
  • Horizon does not pay because the member is not enrolled in Medicare.

RESPONSE FOUR: CHANGE IN PRIMARY COVERAGE –   As referenced in Response number two, retirees enrolled in Medicare Advantage programs are enrolled in Medicare. However, the Original Medicare benefits are replaced by the benefits provided under the Medicare Advantage program. This does simplify the claim process for the member, they can submit balances left (co-payments) from the Medicare Advantage plan to an alternative plan, and depending on the rules of the coordinating plan, payments may or may not be paid based on the rules of those plans. If coordination of benefits is an issue for some members, they can choose to opt out of the plan.

Carrier Updates – NJ DIRECT

Bayonne Medical Center is terminating effective February 7, 2009. There are no negotiations presently going on between Horizon and the hospital.  Memorial Sloan Kettering at Basking Ridge – will be an in-network facility effective December 1, 2008. Jane Oates asked if are there any other hospitals that are still in negotiations with Horizon.  Carol Banks, Horizon, said that they are still in negotiations with CHOP.

State Health Benefits Program Regulations Update – FYI
David Pointer asked that if any of the Commission members have suggested changes they should contact him.  Jane Oates suggested that a subcommittee be formed from this Commission. Frederick Beaver asked DAG Den Bleyker if this was legal. DAG Den Bleyker said a subcommittee could be formed; however, it cannot be a full quorum or the Open Public Meetings Act would apply. Florence Sheppard commented that the Division would have to look at the staff availability and get back to the Commission on this. Fred Beaver indicated that the SHBC regulations will not be approved until March. Jane Oates said they will have a discussion on this and on how to proceed. 

The following cases due to HIPAA regulations are seen in closed session, with motions and voting done in closed session.

Jane Oates made a motion to go into closed session under Resolution A. Joseph Del Grosso seconded the motion. All voted in favor.

SE120801 (Member was present) - This Horizon-NJ DIRECT10 appeal concerned the denial of benefits for expenses for the Synagis vaccine for a dependent child. The member advised the Commission that their child was born prematurely at 33 weeks gestation and suffered from numerous complications in the neonatal period. The child’s medical records state that she is immunocompromised which requires Synagis vaccine to prevent Respiratory Syncytial Virus (RSV).  The child’s mother is a second grade teacher. The child had started day care but discontinued because of the denial of the vaccine. The member indicated that the pediatrician, neonatologist and liver specialist all agree that it is medically necessary for the child to receive the Synagis vaccine.

Kevin Kelleher asked Horizon to explain their reason for the denial of the vaccine. Ebner Smith, M.D., Medical Director, Horizon, said that the child does not fall into the highest category for this vaccine and does not have all of the other risk factors. Premature infants, who are delivered between 32 weeks, 1 day to 35 weeks 0 day gestation, who are under six months old must have two extended criteria present. This child was delivered at 33 weeks and had one extended criteria (started day care).  Joseph Del Grosso asked what the other factors are. Dr. Smith indicated that there are four other factors:  school-aged siblings; exposure to environmental air pollutants (excluding tobacco smoke); congenital abnormalities of the airways; and, severe neuromuscular disease. Kevin Kelleher asked if teachers are exposed to the same diseases as a school aged sibling would be since the member is a school teacher.

Jane Oates asked if the child is still seeing a liver specialist. Wendy Burns responded yes. Wendell Steinhauer made a motion to approve the appeal on the basis that the mother is a teacher in an elementary school which exposes her to the same diseases as school aged siblings would.  James Geiger seconded the motion. Approved (Vote 7: 1: 1:  Commissioner Gallagher voted nay and Commissioner Peden abstained).

There being no further appeals, a motion was made to return to open session by Jane Oates, seconded by Wendell Steinhauer. All voted in favor.

Kevin Kelleher asked if there are drugs that have to be authorized in the pharmacy program today.  David Pointer responded yes, specialty drugs. Kevin Kelleher asked for a list of the drugs for specialty pharmacy.

Richard Quinn asked if there was any other remedy for an appeal. Is there flexibility on the part of the staff?  Dave Pointer said that there is, but there is no medical director on staff. DAG Den Bleyker said that the SEHBC is bound by the regulations; the regulations adopt the carrier’s policy and guidelines.

David Pointer wanted to clarify something with James Geiger and he asked him if he was suggesting that as long as a member’s physician authorizes specific treatment that Horizon should just agree with them? James Geiger amplified that there were dueling medical opinions. He said he was disturbed by the one-sided telephone conversation that Horizon’s medical director reported and that it was inappropriate. He considered it hearsay.

Wendell Steinhauer commented that the SHBC had an agenda item for a change in coordination of benefits between NJ DIRECT10 and NJ DIRECT15. He asked if this  will this be presented to the SEHBC. David Pointer referred the question to DAG Den Bleyker for response. DAG Den Bleyker said the SHBC approved the coordination of benefits between the plans which affects both the SHBP and the SEHBP members. Wendell Steinhauer asked when will the members be notified. Florence Sheppard responded that it was just approved and that staff needed to speak to Horizon.

There being no further business to transact, a motion was made to adjourn by Jane Oates, seconded by Joseph Del Grosso. All voted in favor. The School Employees’ Health Benefits Commission meeting was adjourned at 2:40 PM.

Respectfully submitted,


Jean M. Williamson, CEBS
Acting Secretary
School Employees’ Health Benefits Commission


                                                                 

 

 

 

 

 
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