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These articles were was prepared for the July 11, 2001

edition of U.S.

1 Newspaper. All rights reserved.

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 Consolidated

Omnibus Budget Reconciliation Act, the goal was to afford an

individual

the option of continuing his health benefits, temporarily at least,

despite loss of job, retirement, divorce, and several other

circumstances.

While this much of the law has filtered through to communal

consciousness,

many of the most important details still lurk in the darkness, leaving

great holes in what we may rosily picture as a seamless medical safety

net.

First, not everyone qualifies. Firms with fewer than 20 employees

may claim a COBRA exemption. If an employer chooses to set up a group

healthcare policy, his workers are not covered under COBRA. Most

employees

downsized or fired from firms that do offer healthcare insurance are

eligible, but those let go because of "gross misconduct" are

not. 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. After

separation

from the employer and his group policy, the employee has 60 days to

file for COBRA protection, and it typically lasts only 18 months (36

at most under certain conditions). While you have it, COBRA protection

broadly extends after termination, to you, your dependents and your

spouse; even if you retire or divorce or go on Medicare. But coverage

does not flow endlessly.

Finally, comes the cost. An employee’s contribution to the firm’s

healthcare insurance, even though it is risen lately in many

companies,

is usually a small percentage of his employer’s cost. Under COBRA,

the employee faces the severe sticker shock of the entire cost of

his group premium — – his old contribution plus his ex-employer’s

share. Add to that another two percent given to the employer for

handling,

and you’ve got a monthly bill that will probably render you ready

for the doctor forthwith. Says Hunter, "COBRA guarantees you the

right to coverage — it does not give you the right to cheap

coverage."

To brush up on the COBRA basics before attending the seminar, go to

www.deferred.com/cobracoverage or vtvt.essortment.com/cobrainsurance.

ERISA. The Employee Retirement Income Security Act is

typically associated with retirement benefits and thus the heavy IRS

regulatory hand in its administration. The goal of this bill is to

assure that the employee benefits plans are established and maintained

in a fair manner. The IRS doesn’t require or even suggest standards;

their concern is simply with a just administration of the plan. But

the employer’s healthcare programs may be very much involved.

Hunter points out that under ERISA’s new medical benefits claims

procedures,

things have been greatly accelerated. For example, under the new

rulings,

if an urgent-care claim request is received incomplete, the

self-insuring

employer has only 24 hours to inform the claimant and another 72 hours

to decide if the claim is valid or not. Those seeking the specific

retirements and benefits plan for any United States employer, can

find it by visiting the home page of www.erisa.com

HIPAA. Rooted in the Clinton Healthcare Reform proposal,

the Health Insurance and Accountability Act of 1996 was designed to

boost accessibility to healthcare. Basically, it reaffirms and

enhances

the COBRA continuity law, allowing the individual to pick up at his

own cost the insurance from his group plan. The nice addition here

is that it is not strictly temporary. Once your 18 month COBRA limit

is finished, you have the right to pick up an individual policy with

the same insurer. And the insurance company must take you on as a

customer. But if you thought 100 percent of your old group rate was

high, wait until you get hit with that first individual premium.

While workers moving from company to company may gasp at healthcare

premiums they pay on the individual policies to which they are

entitled

under HIPAA, employers have found plenty to grumble about too. Within

the regulations are what its authors call "totally sweeping reform

of medical and financial recording." The aim was patient’s rights:

giving the patient easy access to her own files, while not opening

them to the prying eyes of others. To achieve this, HIPAA has set

up standardized electronic recording methods, anti-fraud devices,

and a host of privacy guards. This makes the employer, as one

entrusted

with individual medical records, an upholder of ever-changing

patient’s

rights and subject to high fines if this privacy is violated.

Hunter states that while it may be possible for a firm’s current human

resources personnel to handle all the new and advancing healthcare

regulations, outsourcing may prove a simpler, even more economical

solution.

— Bart Jackson

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B-MS Donation

Bristol-Myers Squibb has donated $1 million to Lawrence

Township to help purchase the Carson Road Woods. This, the largest

corporate donation the township has ever received, will help set aside

187 acres along Carter and Province Line roads for open space. Valued

at $8.4 million, the property was targeted for sale to housing

developers,

and $3 million is the fundraising goal for private donations.

"The Carson Road Woods is a treasure that should be

preserved,"

says Richard J. Lane, executive vice president of Bristol-Myers

Squibb, "so we’re very pleased to be able to assist in this

investment

in open space."

"Bristol-Myers Squibb is a great neighbor and friend to Lawrence

Township residents," says Pamela Mount, township mayor. "The

corporation’s philanthropy has helped the township launch many

initiatives,

from tree planting to public safety grants to today’s generous gift

of funds to purchase land for open space."

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Corporate Angels

Trenton Central High School has teamed up with Rider

University’s Minding Our Business summer program to help develop the

entrepreneurial skills of Trenton area teenagers. In a program made

possible by a grant from Merrill Lynch, the students will work

at projects to include marketing wares at flea markets at the Martin

Luther King Middle School. Goals include strengthening team, and

communication

skills, elevating academic performance, increasing interest in

attending

college, and building self-esteem. Members of the Metropolitan Trenton

African American Chamber of Commerce will mentor each of the

youngsters.

Among the sponsors for the Polo Classic Alzheimer’s fundraiser

on June 23 were Janssen Research Foundation in Titusville.

Others

included Marsh USA of the Carnegie Center, Johnson & Johnson

Sales & Logistics Company in New Brunswick, and Quintiles

Transnational,

at Alexander Park.


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