Corrections or additions?
These articles were was prepared for the July 11, 2001
edition of U.S.
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Hard Knocks of Healthcare
For some reason, we allow healthcare to defeat us. With
retirement benefits, we know that thorough study may mean the
difference
between celebrating our golden years in a cliff-perched bungalow on
Aruba or a three-story walk-up in Queens. But when we hear the terms
HIPAA, ERISA, and of course, the Consolidated Omnibus Budget
Reconciliation
Act of l985 – COBRA, employers and employees alike glaze over. It’s
all too much, and many give up even trying to keep abreast of the
updates.
Recent changes in COBRA and several related laws, however, have made
continual healthcare a friendlier system. On Tuesday, July 17, at
8 a.m. Robert Hunter, senior employee benefits advisor with
Philadelphia law firm of Morgan Lewis & Bockius, speaks on “COBRA
Clarifications” at a seminar sponsored by the Central Jersey
Chapter
of the Worldwide Benefits Network at the New Jersey Hospital
Association
at 760 Alexander Road. Cost: $40. Call 212-630-5278.
For the past 17 years, since the dawn of mandated continual
healthcare,
Hunter has been translating the alphabet soup of governmental dictates
into workable systems for individual companies. His talk will include
such current changes in claims procedures for ERISA,
cafeteria/flexible
benefit arrangements, and modifications of COBRA regulations.
“Basically,”
says Hunter, “these new regulations concerning HIPAA, COBRA, and
ERISA have just twitched the system…streamlining it, making
reporting
times more urgent, but the fundamental mandates remain in place.”
Here is rundown of continual healthcare programs, and an overview
of how each works to keep employees covered by health insurance as
they switch jobs or leave the workforce altogether.
COBRA. Back in l985, when Congress passed the ConsolidatedOmnibus Budget Reconciliation Act, the goal was to afford anindividualthe option of continuing his health benefits, temporarily at least,despite loss of job, retirement, divorce, and several othercircumstances.While this much of the law has filtered through to communalconsciousness,many of the most important details still lurk in the darkness, leavinggreat holes in what we may rosily picture as a seamless medical safetynet.First, not everyone qualifies. Firms with fewer than 20 employeesmay claim a COBRA exemption. If an employer chooses to set up a grouphealthcare policy, his workers are not covered under COBRA. Mostemployeesdownsized or fired from firms that do offer healthcare insurance areeligible, but those let go because of “gross misconduct” arenot. And if a firm goes bankrupt there remains no group to insure,and employees are out of luck.Second, COBRA stands only as a temporary, last resort. Afterseparationfrom the employer and his group policy, the employee has 60 days tofile for COBRA protection, and it typically lasts only 18 months (36at most under certain conditions). While you have it, COBRA protectionbroadly extends after termination, to you, your dependents and yourspouse; even if you retire or divorce or go on Medicare. But coveragedoes not flow endlessly.Finally, comes the cost. An employee’s contribution to the firm’shealthcare insurance, even though it is risen lately in manycompanies,is usually a small percentage of his employer’s cost. Under COBRA,the employee faces the severe sticker shock of the entire cost ofhis group premium — – his old contribution plus his ex-employer’sshare. Add to that another two percent given to the employer forhandling,and you’ve got a monthly bill that will probably render you readyfor the doctor forthwith. Says Hunter, “COBRA guarantees you theright to coverage — it does not give you the right to cheapcoverage.”To brush up on the COBRA basics before attending the seminar, go towww.deferred.com/cobracoverage or vtvt.essortment.com/cobrainsurance.ERISA. The Employee Retirement Income Security Act istypically associated with retirement benefits and thus the heavy IRSregulatory hand in its administration. The goal of this bill is toassure that the employee benefits plans are established and maintainedin a fair manner. The IRS doesn’t require or even suggest standards;their concern is simply with a just administration of the plan. Butthe employer’s healthcare programs may be very much involved.Hunter points out that under ERISA’s new medical benefits claimsprocedures,things have been greatly accelerated. For example, under the newrulings,if an urgent-care claim request is received incomplete, theself-insuringemployer has only 24 hours to inform the claimant and another 72 hoursto decide if the claim is valid or not. Those seeking the specificretirements and benefits plan for any United States employer, canfind it by visiting the home page of www.erisa.comHIPAA. Rooted in the Clinton Healthcare Reform proposal,the Health Insurance and Accountability Act of 1996 was designed toboost accessibility to healthcare. Basically, it reaffirms andenhancesthe COBRA continuity law, allowing the individual to pick up at hisown cost the insurance from his group plan. The nice addition hereis that it is not strictly temporary. Once your 18 month COBRA limitis finished, you have the right to pick up an individual policy withthe same insurer. And the insurance company must take you on as acustomer. But if you thought 100 percent of your old group rate washigh, wait until you get hit with that first individual premium.While workers moving from company to company may gasp at healthcarepremiums they pay on the individual policies to which they areentitledunder HIPAA, employers have found plenty to grumble about too. Withinthe regulations are what its authors call “totally sweeping reformof medical and financial recording.” The aim was patient’s rights:giving the patient easy access to her own files, while not openingthem to the prying eyes of others. To achieve this, HIPAA has setup standardized electronic recording methods, anti-fraud devices,and a host of privacy guards. This makes the employer, as oneentrustedwith individual medical records, an upholder of ever-changingpatient’srights and subject to high fines if this privacy is violated.Hunter states that while it may be possible for a firm’s current humanresources personnel to handle all the new and advancing healthcareregulations, outsourcing may prove a simpler, even more economicalsolution.— Bart JacksonTop Of PageB-MS DonationBristol-Myers Squibb has donated $1 million to LawrenceTownship to help purchase the Carson Road Woods. This, the largestcorporate donation the township has ever received, will help set aside187 acres along Carter and Province Line roads for open space. Valuedat $8.4 million, the property was targeted for sale to housingdevelopers,and $3 million is the fundraising goal for private donations.”The Carson Road Woods is a treasure that should bepreserved,”says Richard J. Lane, executive vice president of Bristol-MyersSquibb, “so we’re very pleased to be able to assist in thisinvestmentin open space.””Bristol-Myers Squibb is a great neighbor and friend to LawrenceTownship residents,” says Pamela Mount, township mayor. “Thecorporation’s philanthropy has helped the township launch manyinitiatives,from tree planting to public safety grants to today’s generous giftof funds to purchase land for open space.”Top Of PageCorporate AngelsTrenton Central High School has teamed up with RiderUniversity’s Minding Our Business summer program to help develop theentrepreneurial skills of Trenton area teenagers. In a program madepossible by a grant from Merrill Lynch, the students will workat projects to include marketing wares at flea markets at the MartinLuther King Middle School. Goals include strengthening team, andcommunicationskills, elevating academic performance, increasing interest inattendingcollege, and building self-esteem. Members of the Metropolitan TrentonAfrican American Chamber of Commerce will mentor each of theyoungsters.Among the sponsors for the Polo Classic Alzheimer’s fundraiseron June 23 were Janssen Research Foundation in Titusville.Othersincluded Marsh USA of the Carnegie Center, Johnson & JohnsonSales & Logistics Company in New Brunswick, and QuintilesTransnational,at Alexander Park.Previous StoryNext StoryCorrections or additions?This page is published by PrincetonInfo.com— the web site for U.S. 1 Newspaper in Princeton, New Jersey.
