8.2 Base Plan Design Options
The Global Benefit Settings screen includes the model's base plan options, including the default deductible, coinsurance, and out of pocket maximum.
There are two Plan Design options available:
- Basic Plan Design
- Donut Hole Design
The member's deductible is a dollar amount that must be met by each member, or the family as whole, before the plan begins providing benefits via copayment or coinsurance. The Single deductible amount must be met by each covered member individually. Once the Single deductible is met by a specific member, that member becomes eligible for plan benefits. The Family deductible amount can be met by any combination of employee, spouse, and children. Once the Family deductible is met, all members become eligible for plan benefits regardless of individual deductible payment.
NOTE: Individual benefit categories may be configured to begin paying before the deductible is reached. For more information, see the waive deductible criteria option under Benefit Category Plan Design Options.
Separate amounts may be configured for Network and Non Network claims for both Single and Family deductibles. The manner in which these separate deductibles accumulate is based on the deductible integration setting.
The Integrate Network and Non Network Deductibles option controls whether the Network and Non Network deductibles accumulate together (enabled) or separately (disabled). When deductibles are integrated, payment toward the network limit applies to the non network limit and payment toward the non network limit applies to the network limit. When deductibles are not integrated, each limit must be met independently.
Plans that do not have separate deductible settings for network and non network claims can be modeled by enabling deductible integration (option should be checked) and setting the Network and Non Network options to the same value. For example, a plan with a fixed $500 individual / $1000 family deductible should enable deductible integration, set both Single deductibles to $500, and set both Family deductibles to $1000.
The Individual Deductible Carry-Over option controls whether payment toward deductible in the three months leading up to the configured time period should apply to the current deductible. With this option enabled, the individual deductible accumulators start at the sum of carried over deductible payment. With this option disabled, the individual deductible accumulators start at zero.
Maximum Plan Payment Amount
Once a member has reached their deductible, or in cases where the deductible is waived, the plan begins providing benefits in the form of coinsurance. The coinsurance options refer to the percentage that will be paid by the plan sponsor, with the remaining percentage paid by the member.
Coinsurance percentages are configured separately for network and non network charges. For charges incurred through network providers, the coinsurance amount is derived from the amount remaining after the network discount. Non network charges may be subject to Usual, Customary, and Reasonable (UCR) rate processing. When the amount billed from a non network provider exceeds the UCR rate, the coinsurance amount is derived from the UCR rate instead of the amount billed by the provider. The member is fully responsible for the remaining payment amount.
A member's "out-of-pocket cost" is the amount paid by the member in addition to a premium and typically includes payment toward deductible, copay, and coinsurance. The Out-of-Pocket Maximum caps the total amount a member or family pays in out-of-pocket costs. Once the maximum is reached, the plan sponsor pays 100% of all remaining expenses for that year.
Separate amounts may be configured for Network and Non Network claims for both Single and Family maximums. The manner in which these separate maximums accumulate is based on the out-of-pocket maximum integration setting. The plan modeler out of pocket includes the deductible amount. When setting up an out of pocket maximum, if the deductible is excluded according to the schedule of coverage, that deductible amount must be added into the out of pocket maximum calculation to make equal assumptions.
Integrating Out-of-Pocket Maximums
The Integrate Network and Non Network Out-of-Pocket Maximums option controls whether the Network and Non Network out-of-pocket maximums accumulate together (enabled) or separately (disabled). With this option enabled, member costs incurred through network providers applies to the non network maximum and costs incurred toward through non network providers applies to the network limit. When out-of-pocket maximums are not integrated, each maximum must be met independently.
Plans that do not have separate out-of-pocket maximums for network and non network claims can be modeled by enabling the out-of-pocket maximum integration options and setting the Network and Non Network values to the same value. For example, a plan with a fixed $5,000 individual / $10,000 family out-of-pocket maximum should enable integration, set both Single maximums to $5,000, and set both Family maximums to $10,000.
Out-of-Pocket Maximum Exceptions
Not all out-of-pocket costs are included when calculating whether a maximum has been hit.
- Benefit level copay amounts (unless the copay applies to out of pocket maximum option is enabled).
- Expenses that are not covered by the plan.
- Any extra costs incurred for not following procedures.
- Charges over the maximums allowed by the plan.
- Amounts above the eligible or allowable charges (UCR).
- Member payment in UCR.
Planwatch determines UCR and ineligible amounts based on actual claim information. These values are not determined as part of the adjudication process.