IMPORTANT NOTICE:
TO: PARTICIPANTS IN THE NEW ENGLAND ELECTRICAL WORKERS BENEFITS FUNDCHANGES TO YOUR HEALTH FUND PLAN OF BENEFITS
EFFECTIVE JUNE 1, 2004
To All Active and Retired Participants:
As we told you last year, health care and insurance costs have been increasing dramatically over the last several years. We continue to anticipate that health care and insurance costs will continue to rise in 2004 and future years. These increases affect the Benefits Fund, requiring us to make changes to continue to preserve the reserves of the Fund, and help ensure that the Fund will be able to pay future benefits. The changes, effective June 1, 2004, fall into three areas: a change to the "Network" we use for medical coverage, a change to our prescription drug provider, and changes to the plan of benefits under the Fund.
Both the number of medical claims to the Fund and the size of the average medical claim have increased dramatically over the two years. These increases, coupled with a downturn in employment, have caused the Health Fund's current operating deficits to average $722,000 per month for the first 3 months of 2004. During these three months, the Benefits Fund paid almost $900,000 more in medical and prescription drug benefits than the same period in 2003. This represents more than a 21% increase in benefit payments! The increase in expenditures does not account for premiums and administrative expenses, which have remained level.
If the Trustees took no corrective action to modify the Plan of Benefits, they would be ignoring the possibility of bankruptcy of the Fund. The Trustees have made the changes described in this Notice across the board, so all Fund members are affected. The Trustees believe these changes have been made in a fair and equitable manner, so that all of the Fund's beneficiaries will share in the changes, which will help to preserve the Fund.
The Trustees realize that no one likes to pay more for fewer benefits. But, on the advice of the Fund's consultant, the benefit changes were adopted to help preserve the ability of the Fund to continue to pay claims. The Trustees hope these changes will be sufficient to slow the dramatic increase in Fund claims. Please note that there is no guarantee that either increases in the contribution rate or a further reduction in benefits will not be needed in the future.
The Trustees have made the following changes to the Fund to help ensure that the Fund can pay benefits on you and your dependents:
CHANGE IN "NETWORK" FOR MEDICAL CARE
When you use an "In-Network" provider (doctor, facility, etc.) you are using a provider that has negotiated its fees with our "Network." Using a Network is one way the Fund helps contain its costs because In-Network providers are limited (by contract with the Network) in the amount they can charge our members.
Effective June 1, 2004, the Fund will switch to the Anthem Network. Anthem is a company that has its roots as Blue Cross/Blue Shield providers. The Trustees are confident that the Anthem Network will be effective in negotiating even lower rates with providers than our current Network has had.
It is important for you to note that claims processing will continue to be through the Fund, not Anthem. We will use Anthem's Network only, not their claims processing. Enclosed please find new identification cards that show providers that you are in the Anthem Network. with an Alternate Identification Number instead of your Social Security Number! Please throw out your old identification cards immediately.
The Trustees believe that this new Network will allow members more choices in who provides medical coverage to them, since Anthem is a nation-wide network, and has extensive experience in negotiating favorable rates for Funds such as ours.
CHANGE IN PRESCRIPTION DRUG COVERAGE
Beginning June 1, 2004, we will change from using PCS for our prescription drugs to the Sav-Rx prescription drug program. This Sav-Rx program is the one that the International Brotherhood of Electrical Workers' International plan sponsors for its member Locals.
As with the change in our Medical Network, the change in prescription drug providers should help reduce the Fund's expenses, while improving the services members receive. You will notice that your new identification card reflects the Sav-Rx prescription drug program on the lower left corner of the card. You will now only need one card for both your medical treatment and prescription drug coverage.
Later in this letter, we will discuss changes to the prescription drug program itself. These changes are separate from the change in prescription drug provider, and would have been implemented even if we had not changed providers.
CHANGES TO IN-NETWORK CO-PAYMENTS
All In-Network medical services that are available to you under the Fund require you pay a "co-payment" at the time you receive that service. After making that co-payment, you will not be charged any additional amount for the services provided in the Network. Please note that you cannot apply co-payments to your Out-of-Network deductible or Out-of-Network out-of-pocket maximum.
Change To In-Network Provider Co-Payment
Beginning June 1, 2004, the required co-payment for many In-Network services will increase to $20. All services provided by an In-Network provider are subject to the one co-payment. For example, if you visit an In-Network physician for an office visits and have lab work done, you pay only one co-payment for all services on that visit. If you use the services of an Out-of-Network physician, those services are subject to the Out-of-Network deductible and coinsurance.
In-Network Outpatient Hospital Co-Payment
Beginning June 1, 2004, the required co-payment for an outpatient hospital visit will increase to $100. This one co-payment covers all medical services you receive during any visit. That is, you pay only one amount, even if you receive medical services from a variety of providers during that visit, such as outpatient surgery, anesthesia received during the outpatient visit, MRI, and so on. If you use the services of a non-participating hospital, those services are subject to the Out-of-Network deductible and coinsurance.
In-Network Hospital Admission Co-Payment
Beginning June 1, 2004, the required co-payment for an inpatient hospital admission is $150 per day, up to a maximum of 3 days ($450). That means that if you are admitted to a participating In-Network hospital, you will be charged a $150 co-payment for each day you are in the hospital up to three days. After that, you do not have to make any additional co-payments. The following table summarizes the payments you will make:
Number of days of in-hospital stay | Total co-payment for hospital stay |
1 | $150 |
2 | $300 |
3 or more | $450 |
In addition, the maximum amount that you will spend for your family in one calendar year is $900 (6 days). Once you have exceeded this amount, any future stay you or a covered family member has during the calendar year will have no co-payment. The $900 calendar year maximum will be reduced by any inpatient hospital co-payment you may have paid during the first five months of the 2004 calendar year.
For purposes of determining an inpatient admission, any readmission that occurs within two calendar days of a discharge will be treated as part of the original inpatient admission.
Charges billed by a non-participating provider, regardless of your control over the services provided, are subject to the Out-of-Network deductible and coinsurance.
In-Network Outpatient Chemotherapy and Radiation Therapy
Beginning June 1, 2004, the required co-payment for chemotherapy and radiation therapy is $50. The maximum total amount that a participant receiving chemotherapy or radiation therapy will pay for one cycle is $200. Another way to look at this approach is that a participant receiving chemotherapy or radiation therapy will pay for only the first four treatments in any one cycle; there is no additional co-payment for treatments in excess of four in a cycle.
In-Network Inpatient Chemotherapy and Radiation Therapy
Chemotherapy or radiation therapy treatments received during an In-Network hospital stay are covered by the daily co-payment, if any, described earlier in this Notice.
Chiropractic Care, Physical/Occupational Therapy, Massage Therapy, Speech Therapy
The co-payment for any of these therapies is the same $20 co-payment as any other In-Network office visit. However, the Fund will pay for only 30 visits per calendar year for any of these therapies combined. After 30 visits, the member will pay the entire amount for such visits.
In-Network Inpatient Mental and Nervous Benefit
The required co-payment for an In-Network inpatient mental or nervous admission remains at $100. Unlike the Fund's regular In-Network inpatient co-payment, this $100 is paid only one time during any admission. The Fund will consider and pay up to 60 mental and nervous inpatient days per calendar year combined In-Network and Out-of-Network.
In-Network Outpatient Mental and Nervous Benefit
The required co-payment for an In-Network outpatient mental or nervous visit remains at $20. The Fund will consider and pay up to 26 outpatient mental and nervous visits per calendar year combined. In-Network and Out-of-Network.
In-Network Inpatient Drug/Alcohol Addiction Benefit
The required co-payment for an In-Network inpatient drug/alcohol addiction admission remains at $100. Unlike the Fund's regular In-Network inpatient co-payment, this $100 is paid only one time during any admission. The Fund will consider and pay up to a Lifetime Maximum of 60 drug/alcohol addiction inpatient days combined In-Network and Out-of-Network.
In-Network Outpatient Drug/Alcohol Addiction Benefit
The required co-payment for an In-Network outpatient drug/alcohol addiction visit remains at $20. The Fund will pay up to 30 drug/alcohol visits combined In-Network and Out-of-Network during a calendar year.
CHANGES TO OUT-OF-NETWORK DEDUCTIBLE AND COINSURANCE
Beginning June 1, 2004, the Out-of-Network deductible for an individual will increase from $200 to $400 per calendar year. The family maximum deductible will increase from $400 to $800 per calendar year.
The family deductible is satisfied by at least one family member satisfying the individual deductible with all other covered family members' unreimbursed covered expenses applied to satisfying the deductible. If you have already satisfied the pre-June deductible (or satisfied a portion of it) for the 2004 calendar year, your future Out-of-Network claims will have the increased deductible assessed in processing the claim.
Beginning June 1, 2004, all coinsurance reimbursement is reduced to 50% of the "Reasonable and Customary" amounts. The Fund currently reimburses at 80% of the Reasonable and Customary limitation for many benefits.
Beginning June 1, 2004, the coinsurance limits have been removed for Out-of-Network services. There will be no limit to how much a member would have to pay for Out-of-Network services. For example, a member receiving $10,000 of Out-of-Network benefit would pay (as a single member) $400 co-payment, plus 50% of $9,600 ($10,000 - $400), for a total of $5,200.
The trustees anticipate that the anthem network will provide members with a larger number of providers and locations than offered under the current network. the trustees believe there will be less of a need for members to use out-of-network services once the anthem network begins on June 1, 2004.
As in the past, if an In-Network Provider is not available within a 30-mile radius of your home and the Anthem Network confirms a lack of an In-Network Provider, the Fund will treat your claims for that Out-of-Network provider as if it were an In-Network claim.
PRESCRIPTION DRUG CO-PAYMENTS AS ADMINISTERED BY SAV-RX AT BOTH RETAIL PHARMACY AND MAIL-ORDER PROGRAM
Effective June 1, 2004, the co-payments will increase as follows:
RETAIL PHARMACY (MAXIMUM 30 DAY SUPPLY)
Generic Prescription: $10 co-payment
Brand Name Prescription without a generic equivalent: $25 co-payment
Brand Name Prescription with a generic equivalent: $60 co-payment
MAIL ORDER PROGRAM (MAXIMUM 90 DAY SUPPLY)
Generic Prescription: $10 co-payment
Brand Name Prescription without a generic equivalent: $25 co-payment
Brand Name Prescription with a generic equivalent: $90 co-payment
The Trustees encourage you to consider the mail-order program for maintenance prescriptions. As you can see, the prescription drug mail order program requires a co--payment of less than three months for a three-month supply. You can get mail order forms by contacting the Fund Office.
The Trustees also encourage you to consider asking your physician and/or pharmacist whether there is a generic equivalent of the prescription you are taking and is it appropriate for you.
To assist in your decision-making, here are some facts you should know about generic drugs:
Many pharmacies will automatically encourage individuals to take a generic alternative, because this plan design is standard among insurance plans. The decision to use generic medications is ultimately made through the cooperation of your physician, your pharmacist, and you. The co-payment for generic prescription drugs is one-half the co-payment for a brand name prescription.
Beginning on June 1, 2004, the Benefits Fund will pay a Lifetime Maximum of $1,000 combined for both eyes at a 50% Co-Insurance.
If a participant receives Hearing Benefits in a state that does not have a Speech and Hearing Clinic established by a University and contracted with the Benefits Fund, the participant will be reimbursed expenses otherwise eligible pursuant to the Plan of Benefits, up to the rates paid to a University participating with the Benefits Fund.
The Eligibility Provision of the Plan was amended effective April 1, 2004, to eliminate any extension of benefits (Bank of Hours), pursuant to the Continued Eligibility provisions of the Plan, for any Collectively Bargained employee who is no longer working in Covered Employment and is not available for work, whether or not such employee is gainfully employed elsewhere. This provision does not apply to a participant if the participant is unable to work due to disability, Family and Medical Leave Act or Military Leave.
Health benefits for these participants will terminate the last day of the month the participant leaves Covered Employment and is no longer available for work in Covered Employment. The Fund offers participants who are not available for work and not working in Covered Employment COBRA privileges to continue benefits on a self-payment basis for a maximum of 18 months.
It is with regret that the above changes are necessary to preserve the financial integrity of the Fund to be able to pay future claims.
HINTS FOR EFFECTIVELY USING NEW ENGLAND ELECTRICAL WORKERS BENEFITS FUND
See your doctor regularly. There is no substitute for preventive care, such as annual physicals, annual flu shots, and having your children receive immunizations. By visiting your doctor regularly, you help your doctor notice any early signs of problems, which will allow you to receive preventive treatment and review before the problem becomes more severe.
Consider using generic equivalents to name brand drugs. Generic drugs are equally as effective as their name-brand counterparts, and cost both you and the Fund less.
Consider using "mail order" to fill your prescriptions. This is especially true if you are on a maintenance drug, or one that you are taking regularly. Examples include drugs intended to reduce high levels of cholesterol and those intended to reduce high blood pressure. Our plan encourages your use of mail order by making your cost of prescriptions less if you have your prescriptions filled in this way.
Use Emergency Rooms only for true medical emergencies. Our plan is designed to encourage you to use your regular physician because we believe treatment from your own doctor is more cost-effective and personalized than at an Emergency Room. Receiving Emergency Room care is only appropriate when your symptoms are life-threatening or severe.
Review your medical charges and all bills and invoices from your providers. Although mistakes from your providers are probably rare, you can help the Fund by reviewing all bills and invoices to ensure that the listed services were actually performed.
Make sure you understand what is and is not covered by this plan of benefits. Your health is important, and knowing what coverage you have can help you be a smart, health consumer.
When you travel, make sure to review the In-Network hospitals under this plan. Anthem has a large number of hospitals around the country considered "In-Network." By reviewing the hospitals available at your destination before you leave, you will help yourself by using In-Network facilities and care.
Use In-Network doctors, hospitals, and services whenever possible. The Fund has negotiated with In-Network providers to provide high-quality, cost-effective service. Your costs are less when you use In-Network care, so choosing this option benefits both you and the Fund.
Live a healthy lifestyle. Many medical problems can be traced to poor eating habits, excessive smoking, lack of exercise, and other poor habits. By taking control of your own health, you will feel better, and could reduce your need for medical services.