4th Quarter 2016 Benefits Corner


By Al Horan

Al Horan Captioned Q2 2015

Post-65 Retirees – 2017 Changes in Health Coverage

As Mike Elgie points out in his letter, if you haven’t already done so, post-65 retirees need to register with OneExchange and set up an appointment with a Benefits Advisor. The Benefits Advisor will do a search and work with you to select medical and drug coverage for 2017. Remember, after December 31 Chevron’s Medical Plans for post-65 retirees and survivors will cease to exist! There is no automatic rollover to new coverage! If retirees and survivors do not purchase Medical Coverage through OneExchange, they will lose Chevron’s contribution and they will not have Medical Coverage on January 1, 2017. (For more information please see pages 42-48 of the 2017 “Open Enrollment is Here” booklet which was mailed to you by Chevron in early October. The booklet provides information about select opportunities, “enrollment milestones, in which to enroll in the future. Please phone the Chevron HR Service Center if you have questions about retiree health care eligibility or enrollment milestones. Their phone number is 1-888-825-5247 and their hours are Monday through Friday from 6AM to 5PM, Pacific Time.)

In preparation for your appointment to enroll in health care coverage for 2017, please read the 2017 “Enrollment Guide” that was mailed to you by OneExchange in early October. This is especially important for anyone who was unable to attend an OneExchange Informational Meeting in September/October or who was unable to view the OneExchange presentation that was available online. In addition, when working with the Benefits Advisor it’s important that you share pertinent information with them so that they can find the best medical coverage and prescription drug coverage that meet your needs. Besides providing background information about your medical providers and your prescription drugs, you should also consider sharing information about any medical treatment or procedure you are expected to have in 2017 and the overall level of your health. With this information the Benefits Advisor will be able to recommend medical and drug coverages that best meet your immediate and long-term needs. The more information you provide the better the results will be.

When deciding what type of coverage makes the most sense for you, you should remember that typically the lower the premium is the more restrictive will be the coverage. Medicare Advantage Plans usually generate the lowest premiums, but, in the case of a HMO, you must use their medical providers otherwise there is no coverage. On the other hand, a PPO version of an Advantage Plan provides more flexibility. If you use providers that belong to their network, you typically pay less than using a provider outside of the network. These Plans also usually include Prescription Drug Coverage. The coverage and premiums can vary by insurance carrier/provider organization. If there is a match to your current medical providers, a Benefits Advisor may suggest that you consider joining a Medicare Advantage PPO Plan.

On the other hand Medigap Plans offer the most freedom of choice of medical providers but they typically cost the most. Also, these Plans do not include Prescription Drug Coverage. Therefore, you will need to purchase a separate Prescription Drug Plan. The combination of a Medigap Plan and a Prescription Drug Plan come the closest to duplicating the current Chevron medical coverage provided by the Chevron Medicare Plus Plan, the Senior Care Plan and the Standard Plan. It is my understanding that Benefits Advisors at One Exchange will typically recommend that retirees consider joining a Medigap Plan F or Medigap Plan N if they were previously covered by a former employer’s medical plan, similar to the three Chevron Plans mentioned above. Medigap Plan F covers in full all deductibles, copayments, etc. that are the retiree’s responsibility under Medicare Part A and Part B. The retiree’s only responsibility is to pay the Plan’s premium. (This is generally the most expensive Plan.) In the case of Medigap Plan N the retiree is responsible for the Medicare Part B deductible, copayments for office visits, copayments for emergency room visits, and excess provider charges that are permitted by law. The premiums are generally less than Medigap Plan F. The premiums for these Plans are determined by community rating method, an issue age rating method, or an attained age rating method. Depending upon the age of the retiree when the Plan is purchased the community method or the issue age method can be the least costly method over a long period. On the other hand the attained age method can be the most costly method over a long time. AARP – United Healthcare has the only community rated plans that I’m aware of. Few plans are issue age rated. Most plans are attained age rated.

To help understand the rating methods and the long term implications of such, I prepared the following summary:

  • Community Rated Plan: Generally the same premium is charged to everyone who has the Medigap policy, regardless of age or gender. Premiums may increase because of inflation and other factors like usage.
  • Issue Age Rated Plan: The premium is based on the age of the policyholder when the Medigap policy is purchased. The premium may increase because of inflation and other factors like usage.
  • Attained Age Rated Plan: The premium for this Medigap policy is based on the age of the policyholder each year or every few years. The premium increases because of age, inflation and other factors like usage.

As mentioned, if you elect to join a Medigap Plan you will need to purchase separate Prescription Drug Coverage. (Generally, Medicare Advantage Plans include prescription drug coverage.) In order to search for Prescription Drug Coverage it will be necessary to make the Benefits Advisor aware of prescription medications you are taking. Under Government regulations a provider of drug coverage must offer at least two medications for each medical condition. However, it’s possible that the drugs offered may not match the prescription drugs you are taking. Also, unlike the Chevron Medical Plans you will not have partial drug coverage if you are one of the 25% of individuals who go into the Coverage Gap (“Donut Hole”). However, if you are effected by the Donut Hole you should ask your Benefits Advisor to price out the cost of Prescription Drug Coverage with enhanced coverage while in the Coverage Gap. (Please note, if you go into Stage 4 – Catastrophic Prescription Drug Coverage Chevron has arranged for supplemental coverage.) The premium cost of Prescription Drug Coverage is competitively priced based on covered medications and whether there is enhanced coverage.

If you are presently covered by a Chevron Medical Plan, through OneExchange you are guaranteed the issuance of medical and drug coverage irrespective of the condition of your health. After the initial enrollment for 2017 health coverage, you will be permitted to freely change Medicare Advantage Coverage and Prescription Drug Coverage during future open enrollment periods generally irrespective of the condition of your health. However, with respect to Medigap Plans, insurers will generally require a statement of health. Some insurers have more stringent underwriting requirements than other carriers. Therefore, it’s important to make your selection of coverage carefully since most individuals do not change their Medigap coverage.

If you are presently a member of a Chevron Medical Plan, you will not be faced with a pre-existing condition limitation. However, if in the future you should change your medical coverage an insurance carrier could impose a pre-existing condition limitation which can last up to six months. Also, if a medical procedure is deferred until 2017, it’s possible that the new carrier may make the medical provider refile documentation to justify the procedure. Where possible, it may be less involved to take care of any pressing medical procedure before the end of 2016. Likewise, I would suggest ordering your prescription medications before the end of the year since there could be a slight delay in effecting your new Prescription Drug Coverage. Also, you will need new prescriptions for your new prescription drug provider.

If you are presently a member of Kaiser through Chevron and you elect to enroll in a Kaiser Plan through OneExchange, you will need to provide OneExchange with your Kaiser provider/PCP name. The PCP number and the Kaiser medical number are not required to complete the application. 

Finally, just a reminder that in the future you will advance the premiums for your new medical and drug coverage monthly and after the insurance carriers verify receipt of your premium to OneExchange, OneExchange will deposit Chevron’s monthly contribution into your Health Reimbursement Arrangement (HRA) Account. For more information about HRAs please see the “Chevron Post-65 Retiree Health Care HRA Quick Reference Guide” that was mailed to you by OneExchange in early October.

Needless to say, this new arrangement is far more complicated and requires more involvement by retirees than the past Chevron Medical Coverage. Federal regulations require that personal information be repeated for each plan you enroll in. You will also need to listen to recorded messages for the plans in which you enroll. My suggestion is to remain calm, focused and engaged with the Benefits Advisor so that your objectives are met. As I mentioned in the beginning of this column, you must take action to secure your Medical and Prescription Drug Coverages now for 2017 otherwise you will not have coverage on January 1, 2017! If you haven’t already phoned OneExchange, you must take immediate action by phoning them at 1-844-266-1392 to secure Medical and Prescription Drug Coverage for 2017.

Finally, Chevron Dental and Vision Coverages will cease as of December 31, 2016. However, CRA Dental Coverage will continue to be available through MetLife. Anyone who currently has Chevron Dental Coverage can take up new coverage through OneExchange or through CRA. OneExchange is also making available Vision Coverage which is offered through VSP.

Pre-65 Retirees – 2017 Changes in Health Coverage

As you know, Open Enrollment for pre-65 eligible retirees and their eligible dependents will run from October 17 through October 28, 2016. If you did not receive your Open Enrollment package, you should contact the Chevron HR Service Center at 1-888-825-5247 between the hours of 6AM and 5PM, Pacific Time, Monday through Friday.

If you are currently a member of a Chevron Medical Plan, your participation will continue in the same plan you elected for 2016, unless you are presently a member of Option 1 in which case you will automatically be enrolled in the Medical PPO Plan (formerly Option 2). If you are currently participating in Option 2, you will automatically be reenrolled as a member of the Medical PPO Plan. If you are currently participating in the High Deductible Health Plan (HDHP), you will automatically be reenrolled in the same Plan for 2017. Also, Chevron is introducing a new plan, the High Deductible Plan Basic (HDHP Basis) which provides catastrophic coverage. If you wish to enroll in the HDHP Basic, you will need to take action between October 17 and October 28. (If you enroll in the HDHP or the HDHP Basic, you may be eligible to enroll in and contribute to a Health Savings Account (HSA)). If you are a participant of a HMO Plan, you will be automatically be reenrolled, provided the plan will continue to be offered in 2017. Please remember you and your pre-65 dependents must be enrolled in the same medical plan as you.

Starting with 2017 Anthem Blue Cross will replace United Healthcare as the administrator of the Medical PPO Plan, the HDHP and the HDHP Basic. Also all existing Chevron Dental Plans will be replaced by Delta Dental or DeltaCare USA. Prescription drug coverage will continue to be administered by Express Scripts and Vision Program will continue to be administered by VSP Vision Care. 

If you are not currently enrolled in a Chevron Medical Plan and you are eligible to enroll, you will have a one-time option to enroll. If you do not take action to enroll in a Chevron Medical Plan or health coverage offered through OneExchange, you will forever forfeit your right to enroll at a later date! (For more information please see pages 42-48 of the 2017 “Open Enrollment is Here” booklet which was mailed to you by Chevron in early October. The booklet provides information about select opportunities, “enrollment milestones, in which to enroll in the future. Please phone the Chevron HR Service Center if you have questions about retiree health care eligibility or enrollment milestones. Their phone number is 1-888-825-5247 and their hours are Monday through Friday from 6AM to 5PM, Pacific Time.)

Tips and Helpful Information

Hospital Stay – Observation Status

You will probably recall that in earlier issues of the Benefits Corner I wrote about hospitals holding patients in emergency rooms for extended periods without admitting them as inpatients. As a result patients who required the care of skilled nursing facilities following a hospital stay were denied coverage under Medicare Part A because they did not satisfy the prerequisite of a three day inpatient hospital stay before being admitted to a skilled nursing facility for post-acute care. This is now changing. Hospitals are required to inform patients who are hospitalized for more than 24 hours that they are in observation status. No later than 36 hours after a patient begins to receive observation services, the patient must be informed, both orally and in writing, of their observation status. The written notice must explain that the individual is not an inpatient, the reasons why they are not an inpatient, and the implications of such for both the hospital and the patient.
(Source: Center for Medicare Advocacy)

Sepsis – a Leading Cause of Death

Sepsis is a leading cause of death but it’s little known. It is a life-threatening condition which is triggered by an infection that quickly spirals out of control. Typically sepsis effects people who are over age 65.

Sepsis develops when the body mounts an overwhelming attack against an infection that can cause inflammation in the entire body. When this happens, the body undergoes many changes, including blood clots and leaky blood vessels that impede blood flow to the organs. Blood pressure drops, multiple organs can fail, the heart is affected and death can result.

Sepsis appears to be rising. Between 2000 and 2008 the number of cases of sepsis doubled; and hospitals listed sepsis as the primary illness. The contributing factors to its increase are an aging population, an increase in antibiotic resistance, and better diagnosis. Sepsis is a contributing factor in up to 50% of hospital deaths.

The symptoms of sepsis are chills or fever, extreme pain or discomfort, clammy or sweaty skin, confusion or disorientation, shortness of breath and a rapid heart rate. Also, if blood pressure drops and chokes off blood supply to the organs, a person can go into sepsis shock. For every hour without antibiotics, the probability of dying goes up 8%. Anyone suspected of having sepsis should immediately go to a hospital emergency room.

A study by the CDC found that sepsis was most often associated with lung, urinary tract, skin and gut or intestinal infections and many sepsis patients had visited a doctor or been in a health care setting before developing sepsis. The CDC is urging health care providers to suspect sepsis if the underlying symptoms are present, and to act swiftly in treating the patient. The agency is also emphasizing prevention through better management of chronic diseases, vaccinations and antibiotics.
(Source: New York Times)

Al Horan, Benefits Chair:
Phone: 972-964-1787
Email: awhoran@verizon.net