DePaul University

BlueEdgeSM Consumer Driven Health Plan (CDHP)

October 2009

BlueEdgeSM HSA

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Consumer Driven Health Plans (CDHP)

The Consumer Driven Health Plana empower members to become more involved in their health care decisions

Core Features of a CDHP:

• Comprehensive health benefit plan with access to all of our contracted providers without a referral

• 100% coverage for recommended routine gender and age-specific preventive care, such as physical and ob-gyn exams, mammograms and other cancer screenings, well-child care and immunizations

• Higher deductible can be combined with a tax-advantaged Health Savings Account (HSA), which is employer and employee-funded

• Online consumer decision tools for making more informed health care choices

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HSA Benefit Design Considerations

• Rx and Medical must apply to deductible

• Deductible, copay, coinsurance apply to out-of-pocket maximum

• Entire family deductible must be met before any benefits begin

• Preventive care benefits are excluded from the deductible – 100% Coverage

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Tax-free distributionsTax-free distributions

A Health Savings Account (HSA) is a tax-exempt account established exclusively for the purpose of paying qualified medical expenses.

• An HSA is a funded account (similar to an IRA)

• Eligible individuals and/or their employers may make tax-free contributions within specified annual limits

• Earnings (interest, dividends, investments) in the account grow on a tax-free basis

• Distributions or withdrawals are tax-free, if used for qualified medical expenses

• Must be used in conjunction with a high-deductible health plan (HDHP)

Tax-free earnings$ $ $

Tax-free earnings$ $ $

Tax-free contributionsTax-free contributions

What is a Health Savings Account?

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BlueEdgeSM: Health Savings Account (HSA)

Health Savings Account(Employer and/or Member-Funded)

Member Responsibility

In-NetworkOut-of-

Network

100% of theAllowable Amount

After Out-of-Pocket Maximum

Prescription Drug*

Preventive Care

Annual Deductible *

• HSA member-owned, portable and tax-advantaged

• Choice of debit card, checkbook, or direct payment options

• Standard checking account with investment options

• Real-time interface with Pharmacy Benefits Manager

*Rx and Medical expenses must share deductible

Hassle-free experience ► Member-owned, portable

Family deductible must be met in its entirety before benefits begin.

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Investment Options

Investment Options

Excess BalanceExcess Balance

Flexibility of the BlueEdgeSM HSAThe flexible payment platform of an HSA

accommodates both “users” and “savers”

“Users”have multiple

options to leverage HSA $$$s

“Users”have multiple

options to leverage HSA $$$s

“Savers”can use personal

funds to cover expenses and invest excess

“Savers”can use personal

funds to cover expenses and invest excess

Health Care

Transaction

HSAAccount Balance

HSAAccount Balance

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HSA Account Auto Adjudication

Without auto adjudication*

BCBSIL creates EOB that includes patient share

Member receives EOB and pays doctor patient share using bank debit card, bank checkbook ,or personal funds

Medical Claim

Member goes to doctor for broken

arm

Doctor submits claim

BCBSIL processes claim and determines out of pocket liability for member (copay, coinsurance, deductible)

Auto adjudication turned on*

BCBSIL requests HSA balance information

If balance available, BCBSIL pays provider directly

BCBSIL creates consolidated EOB with HSA dollars used

If any remaining patient share, member pays doctor after EOB generated

* assume network provider.

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What About Prescriptions?

WithoutMember pays for the RX at the

point of sale with bank debit card, bank checkbook, or

his/her own personal funds

Member goes to pharmacy for prescription

Pharmacy sends claims to PBM

PBM processes claim and

determines out of pocket liability for member (copay,

coinsurance, deductible) at the

point of sale

WithPBM requests HSA balance information

If balance available, PBM pulls HSA dollars to pay pharmacy for claim

The pharmacist can see amount due from member (zero if HSA covered RX cost, or partial balance if funds covered only part of Rx cost)

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The University makes a contribution for all eligible active employees who enroll in the BlueEdge Consumer Driven HSA Medical Plan.

DePaul provides the entire annual employer contribution to all participants as soon as administratively feasible following:

• An employee’s plan entry date (plan entry dates are always on the first of the month) • The employee establishes an HSA with ACS/Mellon Bank. • The employee establishes an HSA pre-tax deduction on Campus Connection

Note: Employees who become HSA eligible mid-year will receive a single lump sum contribution (calculated by taking the maximum annual employee contribution and pro-rating it by the remaining months in the calendar year)

DePaul’s Contributions to Your BlueEdgeSM Consumer Driven HSA

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Personal Contributions to Your HSA

Faculty and staff HSA contributions through salary reduction will only be allowed prospectively the first of the month after all three of the following requirements are met:

• The employee enrolls in the Consumer Driven Health Plan.

• The employee opens a Health Savings Account with ACS/Mellon bank.

• The employee completes the on-line HSA salary deferral election on benefits self-service thereby establishing the pre-tax deduction on the payroll system.

Faculty and staff can prospectively change their HSA contribution amounts for any reason throughout the calendar year.

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Allowable HSA contributions to the BlueEdgeSM HSA

Type of CDHP Coverage

DePaul HSA Contribution (full year)

2010 Maximum Total Annual Contribution

2010 Maximum Employee Contribution

Single Coverage $500 $3,050 $2,550

Employee+

Child or Spouse

$1,000 $6,150 $5,150

Age 55 +

Catch-up

$1,000 Single: $3,550

Family: $6,150

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To be eligible to make HSA contributions...

to the BlueEdgeSM HSA

• You can not also be insured by another medical plan with a “normal deductible” such as Medicare, Medicaid, or possibly a spouse’s medical plan

• Neither you nor your spouse can have a full-purpose (FP) Flexible Spending Account (FSA): only limited-purpose (LP) FSAs are allowed

• You can not be eligible to be claimed as someone’s dependent on their tax return

• To determine if you are eligible to make Health Savings Account contributions, you are advised to talk to your tax advisor and review IRS Publication 969

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Limited PurposeFlexible Spending Account

• If you enroll in the HSA Plan and also enroll in the DePaul Health Care Flexible Spending Account, you will be defaulted to the DePaul University Limited Purpose Flexible Spending Account (LPFSA)

• Until the CDHP deductible is met, you can only use your LP FSA funds to be reimbursed for dental and vision care expenses.

• After you meet the CDHP deductible you can use FSA funds for medical expenses.

• See the Flexible Spending Program Summary Plan Description on the DePaul HR website.

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The individual is responsible for substantiating withdrawals. Documentation of qualified medical expenses is required.

Distribution Rules

Distributions are tax-free if taken for “qualified medical expenses”

• Includes over-the-counter drugs

• Qualified medical expense must be incurred on or after the day the HSA was established

• If HDHP coverage effective on first day of month, HSA can be established as early as first day of same month

• If HDHP coverage effective any day other than first day of month, HSA cannot be established until first day of following month

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Qualified Expenses

Qualified medical expenses are discussed in IRS Publication 502. They include the following:

– COBRA continuation coverage– Any health plan coverage while receiving unemployment compensation– Retiree Medical Expenses– Qualified long-term care insurance premiums (subject to the limitations below)

• For taxable years beginning in 2008, the limitations under §213(d)(10), regarding eligible long-term care premiums includible in the term "medical care," are as follows:

Attained Age Before the Close of the Taxable Year

Limitation on Premiums

40 or less $ 310

More than 40 but not more than 50 $ 580

More than 50 but not more than 60 $1,150

More than 60 but not more than 70 $3,080

More than 70 $3,850

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Pay Retiree Medical Expensewith HSA Funds

• The HSA may be of interest to faculty and staff looking to set aside funds on a non-taxable basis to help pay retiree medical expenses.

• When you enroll in Medicare, you can use your HSA funds to pay Medicare premiums, deductibles, co-pays, and coinsurance under any part of Medicare and eligible medical expenses.

• You can also use your HSA to pay for your share of the DePaul Retiree Medical Plan insurance premiums.

• You can not use your account to purchase Medicare supplemental insurance (“Medigap” policies)

• You will no longer be able to make contributions to your HSA account once you become Medicare-enrolled.

BlueEdgeSM Member SupportCustomer Service and Online Tools

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Customer Advocate Support

Our dedicated team of Customer Advocates will:• Address Medical and Prescription Drug inquiries

• Coverage and benefits• Claims inquiries and adjustments• Patient / member liabilities; billing and payment application• Accums management

• Drug formulary questions

• Provide information on HSA products (balance inquiry, enrollment, limited tax questions, etc.)

• Maintain transaction capability on drug vendor systems

• Interface with Rx vendors and affiliated financial institutions

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Health Plan Cost Estimator

Choose the health plan that best fits your budget.

• Help members consider the financial and tax impact of their plan choices

• Creates online personal profile based on key health information

• Health background• Acute and chronic conditions• Prescription drug use• Demographics

• Generates annual out-of-pocket cost estimate

• Comparisons can be pre-populated with employer plan designs

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Blue Access® for MembersHelping Members Make Informed Decisions

Health Risk Assessment

Treatment Cost AdvisorTM

Blue PointsSM Rewards

Personal Health Manager

Member Care Profile

Health Plan Cost Estimator

Monthly Health Topics

Hospital Comparison Tool

Blue Access® for Memberswww.bcbsil.com/members

BlueExtrasSM Discounts

Health Plan Cost Estimator

Be Smart. Well. Web site

BlueEdgeSM Consumer site

Provider Finder

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Personal Health Manager (PHM)Your online wellness experience begins with the Personal Health Manager.

Features include:

• Lifestyle Management tools:• Weight Management• Tobacco Cessation• Fitness and Nutrition Plans

• Health Risk Assessment

• ‘For Your Health’ features

• Online Health Encyclopedia

• Interactive Symptom Checker

• Ask health and wellness questions via secure e-mail

• Member health information

• Blue PointsSM Incentives

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Health Risk Assessment (HRA)

Be informed about your overall health and well-being.

A Health Risk Assessment (HRA) helps assess a member’s health risks, interests, and readiness to change.

• Examines a member’s overall health and well-being

• Provides a detailed report with overall health and well-being score, and sub-scores for:

• Medical health, job satisfaction, life load, risk and lifestyle, mood, nutrition, sleep, stress, pain and body weight

• Recommends areas for improvement

• Confidential and secure

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Blue PointsSM Rewards

Stay motivated. Earn Blue PointsSM.

Each time you track a fitness workout, report a meal, ask a nurse a health-related question or use other parts of the For Your Health section in the Personal Health Manager Tool, you can earn Blue Points!

Redeem points at the Blue Points Redemption Center to obtain health and wellness products and other rewards.

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Sample Blue PointsSM Activities

• Completing a Health Risk Assessment

• Setting up fitness or meal plans

• Reading or rating articles and recipes

• Asking a question of a Nurse, Coach, Trainer or Dietitian

• Completing physical activities such as:

• Walking / Jogging

• Yoga

• Hiking

• Dancing

• Swimming

• Physical activities such as:

• Dancing

• Jumping rope

• Attending PE class or participating in sports (soccer, Tae Kwon Do, etc....)

• Nutritional navigator activities such as:

• Drinking less soda

• Eating fruit and cutting back on sugary snacks

• Chores, such as folding laundry or cleaning room

• Cutting back on activities such as television, computer games, etc.

Sample Activities – KIDSSample Activities – ADULTS

ACS/Mellon HSA Banking Option

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Web Integration with ACS/Mellon Bank

View your HSA account information online at Blue Access® Members.

• Check HSA account status without leaving Blue Access® for Members

• View or print detailed history of account transactions and balances

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ACS/Mellon Tools: Calculate Your Tax Savings and Contributions

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ACS/Mellon Tools: Calculate Your Tax Savings and Contribution Limits

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It’s about

Experience.Brand strength to support quality services and benefits

Wellness.Member-centric, employer-friendly approach to health and wellness

Everywhere.Robust national networks provide choice and stability for our members, no matter where they need it