| This
pamphlet focuses on Maryland's Health Insurance Reform Act
of 1993 and subsequent modifications as they apply to small
businesses. This law guarantees small businesses access to
health insurance. The law puts stability into their health
insurance premiums. The law sets up unprecedented consumer
protection. In the law, a small business is a public or private
employer with 2 to 50 eligible employees. Each business decides
whether or not to buy health insurance, from whom to buy insurance
and whether to recover all, part, or none of the premium from
its employees.
All insurance carriers participating in the small employer
market must sell the comprehensive standard health benefit
plan (CSHBP) to any small employer who applies for it and
may sell riders to expand the covered services or lower
the cost-sharing arrangements. Carriers are obligated to
price the CSHBP separate from riders. Carriers may not deny
coverage through the CSHBP to any individual in the group.
The
following pages describe what your premiums buy in health
insurance protection. Accompanying questions and answers
clarify the definitions and cost controls used in the CSHBP.
Remember
that a smart consumer looks at the product, the price, and
the service before buying. If you feel uncertain about the
meaning in any of this material or unsure of its application
to you, you should ask for clarification. You can ask your
insurance agent or broker or the Maryland government agencies
listed in this pamphlet.
Questions
about the Benefit Plan and the Small Group Market
What
is the Comprehensive Standard Health Benefit Plan(CSHBP)?
The CSHBP was developed by the Maryland Health Care
Commission (MHCC). It requires all carriers to offer the
same health benefits to all small employers and establishes
cost sharing (e.g. deductibles, copayments, coinsurance)
for various delivery systems (indemnity, preferred provider,
point of service, health maintenance organization and health
savings account-compatible products). By having the same
benefits and cost sharing arrangements, employers are able
to comparison shop. The benefits (described below) are comparable
to what large employers now provide to their employees and
offer both preventive services and protection against catastrophic
loss. Employers can add benefits to the CSHBP but may not
reduce them. The Commission designs and monitors the plan
so that, on average, the cost does not exceed 10 percent
of Maryland's average annual wage.
What
is meant by a delivery system?
A delivery system refers to the way in which health
care benefits under the CSHBP are received. In a traditional
indemnity program, the individual selects a health care
provider. In a preferred provider organization (PPO), an
individual selects a specific health care provider from
a panel of network providers. In a point of service system
(POS), an individual must select a primary care physician
(a gatekeeper) and can usually receive specialty care only
with prior authorization from the gatekeeper. In an HMO,
an individual must select a gatekeeper and can receive specialty
care from a health care provider under contract with the
HMO only with a referral from the gatekeeper. PPO and POS
plans permit individuals to receive care outside the network
at a greater cost. In a health savings account-compatible
product, the individual assumes the financial risk of a
high deductible health plan (HDHP) as defined by federal
law but can minimize the risk through the use of a health
savings account (HSA) to which the employer, the employee,
or both, subject to federal limitations, have contributed.
How
do I know which delivery system I want to have?
You will want to talk with your insurance agent or broker
or with carriers directly to fully understand the differences
in access to care under these systems. You will want to
talk with your current health care providers to determine
with which carriers and delivery systems they participate.
You will then be able to balance your own needs with cost
to make your final selection.
What
are the criteria for determining a small employer?
A Maryland small employer is any actively engaged business
unit which, in the preceding calendar quarter, employed
at least two but not more that 50 eligible employees on
at least 50% of its working days. The majority of the eligible
employees have to be employed within Maryland. The law also
contains provisions to include self-employed individuals
currently enrolled, certain government units, and non-profit
corporations.
Who
are eligible employees?
Any employee whose normal work week is minimally 30
hours is an eligible employee.
What
about my part-time employees or employees covered under
another health benefits policy?
Employers may elect to cover these employees under the
group policy or elect to exclude these employees.
Under
Maryland's health care reform legislation, do I have to
provide health benefits to my employees?
No. Whether to provide group health benefits is the
employer's decision.
If
I offer group health benefits to my employees, do I have
to pay for these benefits?
No. Maryland's health care reform legislation permits employers
to grant this benefit to employees and their dependents
at no cost to the employer. The employer would pay the premium
to the carrier but could recoup the entire premium or any
portion of the premium from the employee through a payroll
deduction.
How
will my premium be determined for the comprehensive standard
health benefit plan?
Carriers
may not determine your premium based on the claims experience
or health status of your employees. Instead, they will have
to determine the premium in the same way a premium is determined
for large employer groups. The claims experience of all
of the carrier’s small businesses will be "pooled".
The carrier will determine the "community rate"
based on this pool. Carriers may continue to adjust your
group’s premium based on the average age of your employees
and the geographic location of your business. Carriers must
disclose the premium for the CSHBP separately from the premium
for riders.
How
do I purchase health benefits?
Employers may purchase health benefits by contacting
a carrier directly or working through an insurance agent
or broker.
Can
a carrier elect not to cover my group?
A carrier may only deny your group coverage if less
than 75% of your eligible employees who are NOT covered
under a spouse’s plan or another employer’s benefit arrangement
elect to be covered under your group policy.
What
if I want lower deductibles, coinsurance, or copayments?
Carriers may sell lower deductibles, coinsurance, or
copayments to small employers through riders. These riders
must also be community rated. Note, the HSA deductibles
cannot be reduced below the federal minimums required.
What
if I want additional benefits?
You may purchase additional benefits from carriers through
riders. A carrier may require medical underwriting. These
benefits must be priced and sold separately from the CSHBP.
These benefits must also be community rated. The additional
benefits may not reduce the benefits in the CSHBP.
What about coverage for employees or dependents who have
existing health problems?
A carrier may not reject the employee or dependents for
this reason or impose a pre-existing condition limitation.
Moreover, the carrier may not charge a higher premium because
of an employee’s or dependent’s health status.
What if I want to offer only an HMO delivery system to
my employees but some employees would prefer not to be limited
to the HMO provider network?
Under Maryland law, if the HMO is the only delivery
system offered, the HMO must offer a mandatory point-of-service
rider to permit enrollees to access certain services outside
the network. At the time you enroll your group with an HMO,
the HMO will ask if anyone in your group would like this
rider. The cost of this rider may be paid by either the
employer or the employee. This rider enables you to offer
an HMO delivery system and offer some freedom of choice
to those employees concerned about a closed-panel HMO.
I
am a self-employed individual. May I purchase the comprehensive
standard health benefit plan?
No. Effective October 1, 2005, the CSHBP is no longer
offered to self-employed individuals. However, a carrier
is required to offer a renewal policy to those self-employed
individuals currently enrolled in the CSHBP who still work
and reside in Maryland. A carrier may ask you to demonstrate
that a substantial part of your income is obtained through
your self-employment by requesting appropriate copies of
your tax returns.
The
"Medicare Prescription Drug, Improvement and Modernization
Act of 2003" has authorized the offering of health
savings accounts in conjunction with high deductible health
plans. Is this program available in Maryland's small group
market?
Yes, subject to carriers developing and marketing these
products. Maryland's CSHBP regulations have been modified
to accommodate this offering.
What
if I would like to see benefits added to or excluded from
the comprehensive standard health benefit plan?
The MHCC reviews the plan annually. The MHCC calculates
the average premium to determine if it remained below 10%
of Maryland's average annual wage. Based on comments received
and the actual cost of the plan, the MHCC considers making
changes to the comprehensive standard health benefit plan.
Maryland's
Comprehensive Standard Health Benefit Plan
The
following is a summary description of the services covered.
Service
|
Coverage
|
|
Ambulance
Service
|
Covered
|
|
Audiology
Screening for Newborns
|
Covered
for one screening and one confirming screening
|
|
Blood
and Blood Products
|
All
cost recovery expenses for blood, blood derivatives,
components, biologics, and serums, to include autologous
services and albumin
|
|
Case
Management Program
|
Available
for medically complex and costly services
|
|
Chiropractic
Services
|
Carrier
shall pay in-network provider 70% of allowable charges
(50% out-of-network) up to 20 visits per condition,
per year
|
|
Durable
Medical Equipment
|
Covered,
including nebulizers, peak flow meters, and diabetes
glucose monitoring equipment
|
|
Emergency
Room
|
Covered
- $100 copayment (waived if admitted), plus applicable
coinsurance amount
|
|
Family
Planning Services
|
Covered
|
| Habilitative
Services |
Covered,
for children 0-19 years of age for treatment of congenital
or genetic birth defects |
|
Hearing
Aids
|
Covered,
for persons 0-18 years of age up to $1,400 per hearing
aid for each hearing-impaired ear, every 36 months
|
|
Home
Health Care
|
Covered
as an alternative to otherwise covered services in
a hospital or other related institution
|
|
Hospice
|
Covered
|
|
Hospitalization
|
Unlimited
(includes detoxification)
|
|
Infertility
Services
|
Coverage
for services obtained after diagnosis of infertility,
50% coinsurance rate of allowable charges (excludes
in vitro fertilization)
|
|
Medical
Food
|
Covered
for persons with metabolic disorders when ordered
by a health care practitioner qualified to provide
diagnosis or treatment in the field of metabolic disorders
|
|
Mental
Health and Substance Abuse
|
Covered
when delivered through carriers’ managed care system
for 60 inpatient days per person per year with partial
hospitalization traded on a 2 to 1 basis and unlimited
outpatient visits subject to the following cost sharing:
in-network carrier pays 70%; out-of-network carrier
pays 50%
|
|
Nutritional
Services
|
6
visits per condition per year for cardiovascular disease,
diabetes, malnutrition, cancer, cerebral vascular
disease, or kidney disease
|
|
Outpatient
Hospital Services & Surgery
|
Covered
- $40 copayment or applicable co-insurance, whichever
is greater
|
|
Outpatient
Laboratory & Diagnostic Services
|
Covered
- $40 copayment or applicable coinsurance, whichever
is greater; $40 copayment or 50% of the applicable
cost, whichever is less for HMOs
|
|
Outpatient
Short-Term Rehabilitative Services
|
Provided
through a carrier’s managed care system for a maximum
of 30 physical therapy visits per condition per year;
30 speech therapy visits per condition per year; 30
occupational therapy visits per condition per year;
carrier pays 70% or may substitute a $40 copayment
(except federally qualified HMOs may provide 60 consecutive
days). For out-of-network services, carrier pays 50%
of allowable charges
|
|
Pregnancy
and Maternity
|
Covered
|
|
Prescription
Drugs
|
Generic and brand name drugs covered
Deductibles = $2,500 indiv/$5,000 family
Coinsurance = 75% member responsibility 25% plan responsibility
|
|
Preventive Services
|
Covered – preventive services recommended
by the U.S. Preventive Services Task Force and other
services required to be offered by a federally qualified
HMO
|
|
Skilled Nursing Facility
|
100 days as an alternative to otherwise
covered care in a hospital or other related institution.
$40 copayment or applicable coinsurance, whichever
is greater.
|
|
Transplants
|
Covered, for bone marrow, cornea, kidney,
liver, lung, heart, heart/lung, pancreas, and pancreas/kidney
transplants.
|
|
Well Child & Immunization Benefits
|
$10 copayment not subject to overall
deductible for all in-network visits for children
0-24 months and for visits including immunizations
for children 24 months through 13 years.
|
General Cost Sharing Features
| Cost
Sharing Feature |
Indemnity |
PPO/POS |
HDHMO |
HMO |
| Deductible
-Individual Coverage
-Family Coverage |
$2,500
$5,000
|
$2,500
$5,000
|
$2,500
$5,000
|
N/A
N/A
|
| Out-of-Pocket Limit
-Individual Coverage
-Family Coverage |
$4,900
$9,800
|
$4,900
$9,800
|
$4,900
$9,800
|
200% of the annual premium
|
| Lifetime Maximum per Person
|
$2 mil. |
$2 mil. |
N/A |
N/A |
| Coinsurance Rate
-Network
-Out-of-Network |
N/A
80%
|
80%
60%
|
N/A
N/A
|
N/A
N/A
|
| Primary Care Copay |
N/A |
N/A |
$30 |
$30 |
| Specialty Care Copay |
N/A |
N/A |
$40 |
$40 |
| Inpatient Hospital Copay |
N/A |
N/A |
$1,000 |
$1,000 |
| Physician Inpatient Visit Copay |
N/A |
N/A |
$30 |
$30 |
Prescription
Drugs
-Individual Coverage
-Family Coverage
-Pharmacy Coinsurance |
$2,500
$5,000
|
$2,500
$5,000 |
$2,500
$5,000 |
$2,500
$5,000 |
| 75%
member responsibility; 25% plan responsibility |
| Outpatient Lab & Diagnostic Services |
Greater of $40 or co-
insurance
amount |
Greater of $40 or co-
insurance
amount |
Lower of
$40 or 50%
of cost |
Lower of
$40 or 50%
of cost |
| Outpatient Services & Surgery |
Greater of $40 or co-
insurance
amount |
Greater of
$40 or co-
insurance
amount |
$40 co-
payment but not greater than the charges |
$40 co-
payment but not greater than the charges |
HSA-Compatible
PPO:
Deductible: $2,700 indiv/$5,450 family*
Out-of-Pocket Limit: $5,250 indiv/$10,500 family
Lifetime Maximum: $2 million per person
Coinsurance Rate: In-Network = 80% plan responsibility
Out-of-Network = 60% plan responsibility
Pharmacy Coinsurance: 25% plan responsibility
Outpatient Lab, Diagnostic & Surgical Services: Greater
of $40 or coinsurance amt.
HSA-Compatible
HMO:
Deductible: $2,700 indiv/$5,450 family*
Out-of-Pocket Limit: $5,250 indiv/$10,500 family
Copayments: $30 PCP visit; $40 specialty care visit; $30
physician inpatient visit; $1,000 hospital inpatient stay
Pharmacy Coinsurance: 25% plan responsibility
Outpatient Lab & Diagnostic: Lower of $40 or 50% of
cost
Outpatient Services & Surgery: $40 copayment but not
greater than the charges
* Represents
a unified deductible of the medical/surgical and the prescription
drug deductibles
___________________________________
For
further information regarding your own benefit plan and
premiums, contact your insurance agent, broker or carrier.
For
further information on the comprehensive standard health
benefit plan, contact the Maryland Health Care Commission
at 410-764-3460, 1-877-245-1762 or visit the web site at
http://mhcc.maryland.gov.
For
additional regulatory information, contact the Maryland
Insurance Administration at 410-468-2000, 1-800-492-6116
or visit the web site at www.mdinsurance.state.md.us.
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