Healthcare plan - not able to understand the basics; please help

[Guest rpk]

my background is not in Healthcare. But i am asked by my compnay to work on a project for a customer who is in the business of providing Healthcare benefits to the retirees. This is a state retirement agency.

I am trying to understand how the whole retirement helathcare works. So far, this is what i gather.

State Retirement Agency provides HC benefits to all their retirees. They can either enroll in their Traditional HC Plan or enroll in their Cafeteria plan depending on the eligibiity; Health care Plan is a PPO (or HMO in some cases), provided by a third party carrier (like Aetna) that state agency negotiated contracts with. Depending on the service credits, retiree receives a fixed amount of money every month. Retiree uses this money to buy Health Plan.

here are some fundamental question:

1. now say the retiree sees a doctor in the PPO network; to my understanding, 80% is paid by carrier and 20% retiree. But one of the business requiremetn says, Agency will pay medical and pharmacy claims on a daily basis (while agency receives the claims tape every 2 weeks from carrier); I am confused as to why state agency is paying any claims. I thought Carrier pays 80% and 20% by retirre; And that Aetna gets paid on a monthly basis from State Agency for providing the PPO plan to the state retierees.

Can somebody please help me understnad this. Is it anything to do with state retirement agency being "self-funded" (i am not sure if they are self-funded, i am just guessing);

2. I am trying to comprehend what is the role of stage agency in providing Health plan to retirees other than the fact that they negotiated a better deal for retirees through Aetna. Who is administering the plan, who is administering claims, who is processing claims;

3. also when medicare starts, who is processing the claims;

Appreciate any response as you can tell i am yet to learn the basics.

thanks

.

[GBurns]

All plans, health and retirement etc, are supposed to have a Plan Document which will explain what is provided, how, when etc etc.

The retiree benefits program has to have some written document or agreement, whether legislation, employment contract, collective bargaining agreement or all of these so that what is being provided is known.

Service providers such as Aetna would operate under a contract which would have been bid trhough an RFP or similar process.

These documents together will tell you what is to be provided and how, along with operating procedures, responsibilities etc. Nothing would be done by word of mouth.

The answers to all of your questions are in the Plan Documents.

What you should do is get a copy of every one of these documents and read them, rather than speculate or go by what people think. To prevent disqualification plans have to operate as directed by their Plan Documents and assuming that applicable laws are complied with.

By the way, What is it that you are trying to accomplish?

[Guest rpk]

unfortunately i dont have access to any of the plan documents. Anycase, i have discovered lot of material in the web, now i feel i have a better understanding of how the healthcare system works in general.

I am part of the pre-sales team for an IT services company. We are doign an iniital study for redesigning and developing an entire health care system for one of the agencies. We are in the process of hiring some strong healthcare business analysts. No luck yet. One we get somebody, things will start looking better.

thanks for your reply. appreciate.

[GBurns]

If you do not have access to the Plan Documents then anything that you do might be not only incorrect but also of no value.

The plan has to be operated as per its PD and any changes must be as per PD etc.

Most State plans have authorizing legislation. The relevant sections should be referenced in the PD and any changes to the plan or PD might need a change in legislation.

Most State plans are related to CBAs. You cannot change the PD etc without a change in CBA or a MOA.

Together these comprise the documentation of the Plan, without them nothing can be done that would be legal or which would nor cause a major problem.

ALL these documents are public documents and are available for the asking. In any case they should have been given to you without you having to ask.

The material that you discovered on the web has no value unless it is for the particular state plan that you are involved with. The fact that you have to find the documents on the web raises questions about the authority under which you are operating. It now sounds like you do not yet have a contract with the state or agency but are hoping to find something with which to stir their interest.

Be aware that there are very few state agencies that have the authority to create and install their own plan. I have never heard of any state retirement agency that has the authority to change or create a different plan on its own.