OPEN ENROLLMENT 2016 McLaren Health Plan MOTT COMMUNITY COLLEGE Logan Suttmann SET SEG Employee Benefit Services Account Executive Jim McCloy McLaren Health Plan Sales Executive

The content in this presentation is informational. Each employee should review the benefit summary and network information specific to their plan and discuss specific circumstances and questions with their carrier. Health savings accounts (HSAs) and flexible spending arrangements (FSAs) are IRS-regulated accounts. Nothing in this presentation represents tax advice. Discuss HSA/FSA questions with a tax advisor.

TOPICS OF DISCUSSION Insurance terms & the ‘pick two’ concept Traditional plan vs. high deductible health plan Flexible spending arrangements Health savings accounts McLaren network McLaren coverage Tips for a smooth transition

BASIC INSURANCE TERMS This usually sets what is covered and the amount we have to spend out of pocket for services received Covered services List of medical procedures and prescription drugs that are covered under the plan Deductible What employee owes before insurance plan pays Copayment or “Copay” A fixed amount paid for a particular service Coinsurance Employee’s % share of health care costs after deductible is met Out of pocket maximum Maximum amount we will spend on deductibles, coinsurance and copays

PA 152 Public Act 152 of 2011 limits the amount that public employers can pay toward employees’ health insurance (medical coverage). For Mott CC, starting July 1, 2016, the annual hard cap limits are: Single Coverage: $6, Two Person Coverage: $12, Family Coverage: $16, The difference between the plan cost and the hard cap amount the employer can contribute is the premium cost share for the employee.

THE PICK TWO CONCEPT Coverage Level What benefits and prescriptions are covered; out of pocket costs under the plan (deductible, copays, etc.) Flexibility The degree of employee discretion when choosing facilities and providers Premium Cost Share The amount the employee has deducted from their check each pay period to be enrolled in the plan

TRADITIONAL PLAN – Plan 1  Copays generally apply on day one of plan  Deductibles generally only apply to certain services (e.g. in-patient hospital stays, out patient surgical procedures, diagnostic testing, etc. – see benefit summary for details)  Copays generally cover standard services (e.g. office visits, urgent care visits, emergency room visits, prescription drugs, etc.) and do not apply to deductible  Compatible with a flexible spending arrangement (FSA)

HIGH DEDUCTIBLE HEALTH PLAN (HDHP)  Deductible of at least $1,300 for a single person and $2,600 for two-person or family coverage  Employee pays 100% (except for preventive care) of medical and prescription drug costs (less any carrier discounts) until deductible is met  Rx copays do not apply until deductible is met  Generally lower coverage level and lower cost  Compatible with a health savings account (HSA)

FLEXIBLE SPENDING ARRANGEMENT (FSA) BASICS  Tax sheltered account that can be used to reimburse approved medical expenses on a pre-tax basis  Employee’s FSA is funded with employee-elected, pre-tax, payroll deductions. The employee sets the contribution amount.  Money goes in tax free and comes out tax free (if spent on approved medical expenses)  IRS allows contributions up to $2,550 for 2065 (discuss maximum contribution specifics with college HR department)  Account is use it or lose it, but employees may carryover $500 into each new plan year  The entire elected amount is available on day 1 of the FSA plan year, even though money will be deducted over the course of the year  Talk to HR for more details

HEALTH SAVINGS ACCOUNT (HSA) BASICS  Pairs only with Plan 2 (HDHP)  The account and its contents belong to you  Money goes in tax free, can grow tax free and comes out tax free (if spent on approved medical expenses)  Rolls over year after year (no use it or lose it)  Fully portable if you leave the high deductible plan or the district  Accessible in retirement

HSA LIMITATIONS  Only available with tax qualified high deductible health plan (HDHP)  May not contribute (or receive contributions) to an HSA if enrolled in other coverage that is not a tax-qualified HDHP (including Medicare or a medical FSA)  May not contribute (or receive contributions) to an HSA if claimed as a dependent on someone else’s tax return or if a beneficiary of someone else’s general purpose FSA  Discuss other limitations that apply to HSAs and/or FSAs with a tax advisor

McLaren NETWORK Both Plan 1 & Plan 2 function on the McLaren (HMO) network Employees who live outside the service area (Midland, Gratiot, Livingston counties) have access to additional providers through GlobalCare.

McLaren NETWORK Access the full provider directory at: member/SearchForaProviderMHP.aspx

McLaren NETWORK What services are covered outside of the McLaren Network? On both plans, Urgent and emergency care are covered at the in network benefit level (subject to deductible/copays) Plan 1 has an out of network benefit level which extends some additional coverage outside of the McLaren Network Members could be balanced billed for services received under the out of network benefit

McLaren NETWORK What if you have a dependent living outside of the service area? Plan 1 provides coverage for emergency and urgent care and additional out of network coverage for a higher deductible & coinsurance Plan 2 only provides coverage for emergency and urgent care

McLaren PLANS

McLaren COVERAGE – Plan 1 IN NETWORK OUT OF NETWORK

McLaren COVERAGE – Plan 1 IN NETWORK OUT OF NETWORK

McLaren COVERAGE – Plan 1 IN NETWORK OUT OF NETWORK

McLaren COVERAGE – Plan 1 IN NETWORK OUT OF NETWORK

McLaren COVERAGE – Plan 1 IN NETWORK OUT OF NETWORK

McLaren COVERAGE – Plan 1 Prescription Coverage

McLaren COVERAGE: How the Traditional Plan 1 works The Bucket Concept HMO Traditional plan 1 $500 indiv. $1,000 fam. Caps total costs for medical services that are not covered by a copay. Once the deductible is met, most medical services (not subject to flat dollar copay) are covered at 100% Deductible (bucket) Out of pocket max (bucket) Caps total possible costs including: Deductible Coinsurance costs Office visit copays – $20 Primary Care – $20 Specialist – $50 Urgent Care – $150 Emergency Room Rx copays – $10 Generic – $30 Brand Name – $60 Non-preferred brand name $6,350 indiv. $12,700 fam.

McLaren COVERAGE – Plan 2 IN NETWORK

McLaren COVERAGE – Plan 2 IN NETWORK

McLaren COVERAGE – Plan 2 IN NETWORK

McLaren COVERAGE – Plan 2 IN NETWORK

McLaren COVERAGE – Plan 2 Prescription

The Bucket Concept HMO HDHP Plan 2 Deductible Bucket (you pay): Full cost of all medical services Full cost of all Rx Rx Copay Bucket (you pay): Rx copays $10/$25/$40 $2,000 ind. / $4,000 FF HSA 1st 2nd You use money from your HSA account to pay for qualified medical/Rx expenses Once you’ve reached your deductible, you only pay Rx copays If you use your entire deductible and Rx copay max up, both medical and Rx are covered at 100% McLaren COVERAGE: How the HDHP Plan 2 works

McLaren PLAN YEAR  McLaren’s benefit year (deductible year) runs on the Calendar year (1/1 through 12/31)  You will have a short deductible year w/ McLaren (7/1/16 through 12/31/16) to start  There will be another open enrollment in October (2016) for employees to change plans for January 1 st 2017 effective date  McLaren’s rates renew July 1 st and are good for 12 months (7/1/16 through 6/30/17)  Mott CC will be exploring the potential for aligning the rate renewal and the benefit year moving forward…

DEDUCTIBLE CREDIT TRANSFER ***McLaren Health Plan runs on a calendar year deductible*** SOME Mott CC employees may be eligible for deductible credit transfer if: 1) You had NOT met your deductible prior to January 1 st 2016 If you DID reach your deductible prior to January 1 st 2016, you will not get deductible credit, and your deductible will start over 7/1/16. 2) You are moving from an HDHP to Plan 2 (HDHP) or Traditional plan to Plan 1

DEDUCTIBLE CREDIT TRANSFER For employees who have qualified deductible credits from 1/1/16 through 6/30/16 those credits will be transferred over to their new (like) plan BUT: 1. Mott CC will not get the deductible credit report from BCBSM until the 3 rd week in July at the earliest 2. Once the report is sent to McLaren, it will take time to load all qualified deductible credits People that are waiting on deductible credits should try to a) refill prescription drugs ahead of 7/1 and b) avoid scheduling services until the middle to the end of august.

McLaren COST McLaren Plan 1 McLaren Plan 2 HMO TraditionalHMO HDHP Deductible$500/$1000$2,000/$4,000 Coinsurance0% Coinsurance Max$0$2,000/$4,000 Rx Copay$10/$30/$60$10/$25/$40 OV Copay/Spec ER/Urgent Care $20/$20 $50/$150NA Chiropractic Covered at 100% up to $1,000 per person Out of Pocket Max$6,350/12,700$4,000/$8,000 Employee Costs per pay (26 pays) Single (1P)$9.79 None $ into HSA Double (2P)$20.17 None $ into HSA Family (FF)$24.93 None $ into HSA

WHICH PLAN IS RIGHT FOR ME? Plan 1, HMO Traditional Plan $500/$1,000, assume family coverage Best CaseWorst Case Actual – How much will you spend in each category? Deductible$0$1,000? Coinsurance$0 Copays$0$11,700? 6 month premium Cost Share $324 Annual Total$324$13,024? *Example assumes member accesses approved, in-network services only. Numbers rounded for simplicity.

HOW TO CHOOSE A MEDICAL PLAN Plan 1 – McLaren HMO Traditional $500/$1,000 Higher coverage level, higher flexibility, higher cost What tax leveraged accounts are available? FSA compatible Is this plan compatible with my level of risk tolerance? Fits an individual with a lower risk tolerance

WHICH PLAN IS RIGHT FOR ME? Plan 2 HMO HDHP $2,000/$4,000 0% – Assume Family Coverage Best CaseWorst Case Actual – How much will you spend in each category? Deductible$0$4,000? Coinsurance$0 Copays$0$4,000? 7/1 HSA Contribution$1,102 - Annual Total($1,102) HSA balance $6,898? *Example assumes member accesses approved, in-network services only. Numbers rounded for simplicity.

HOW TO CHOOSE A MEDICAL PLAN Plan 2 – HMO HDHP $2,000/$4,000 0% Lower coverage level, lower flexibility, lower cost What tax leveraged accounts are available? HSA compatible Is this plan compatible with my level of risk tolerance? Fits an individual with a moderate risk tolerance

HOW TO CHOOSE A MEDICAL PLAN Some questions to consider during open enrollment: Will you get any deductible credit from 1/1 through 6/30? What is the “actual” situation likely to be for you and your family in the coming year? What medical and prescription services were accessed in the last year? Was last year “typical”? What assumptions are you comfortable making regarding medical and prescription services you are likely to need in the next year? Which of the “pick two” factors are most important to you? Is there an opportunity to pay for medical expenses on a pre-tax basis using an FSA or HSA? What is your risk tolerance?

 Go to and search to see if your doctors, hospitals and care centers participate with McLarenwww.mclarenhealthplan.org  Review the benefit summaries  If you are in an active course of treatment, it is highly recommended that you call McLaren customer service after July 1, 2016 to explain your situation and get instructions to ensure any disruption is avoided to the maximum extent possible TIPS FOR A SMOOTH TRANSITION

 If you are currently taking prescription medications, refill your prescriptions prior to July 1, 2016 to help avoid any disruption as the transition is made to McLaren  If you are taking a brand name medication, follow these steps:  Fill your prescriptions prior to July 1, 2016 to allow your doctor time to secure any necessary prior authorizations following the July 1 transition to McLaren  Let your doctor know you are changing insurance plans  Fill out the Medication Conversion Worksheet for any applicable brand name drugs (your doctor should work with McLaren to determine which of your medications require step therapy/prior authorization)  Depending on your specific situation, it may be necessary for you to try an alternative medication before gaining access to the brand name medicine you are currently taking

TIPS FOR A SMOOTH TRANSITION  Try to avoid scheduling non-critical medical services on or immediately following July 1, 2016  Notify your doctors and pharmacy that your insurance has changed. Provide a copy of your new insurance card at your first visit to any doctors, facilities or pharmacies on or after July 1, 2016  If you have trouble accessing medical or prescription drug coverage on or after July 1, 2016, please call McLaren at the following number:  McLaren customer service:

QUESTIONS?