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Self-Insured Health Plans

Q&A: Identifying Exempt Self-Insured Plans – Basic Information

Q:  Should I ask my employer if my health plan is self-insured?

A:    If possible, it is better to make the determination yourself.  If you ask your employer to confirm the applicability of the autism insurance mandate to your health plan or that your plan is self-insured, you may lose existing coverage or waive your privacy rights.  The Health Insurance Portability and Accountability Act (HIPAA) creates privacy rights that prevent your employer from accessing employee claims information to learn about medical conditions, whether or not your plan is self-insured.

If the plan is not subject to the autism insurance mandate, and does not include comparable provisions, you would risk a determination by your insurance company or TPA that certain currently covered services are no longer covered because the services relate to a diagnosis of an autism spectrum disorder.

If you waive your privacy rights and disclose a diagnosis of an autism spectrum disorder, your employer may terminate your employment in anticipation of excessive medical costs, particularly if the plan is self-insured.  Even if such a termination of employment was discriminatory, violated HIPAA, or was otherwise unlawful, accessing the necessary proof may be difficult.  Even worse, in some cases, a lawsuit would not be a viable alternative and the only recourse may be reporting your employer to the Department of Health and Human Services (HHS).  In that case, while you might be entitled to reinstatement, you would not be entitled to compensation for loss of employment.  For most, that result is rarely worth the effort.

Please do not rely on this short answer to this general question if you think your rights have been violated.  You should consult a lawyer or other specialist who can discuss your specific circumstances, answer your specific questions, and advise you of your rights and all available alternatives for legal recourse.  Behavioral Lifeboat can help you do that.

Q:  How can I determine if my employer has self-insured my health plan?

A:    Most people are not aware of the difference between insured and self-insured health plans (See “Q&A: ERISA Preemption – Basic Information.”).

There are several ways to determine if your employer has a self insured health plan:

1. An explanation of benefits (EOB) issued for your plan may state that the company delivering the EOB is a third party administrator (TPA) for your health plan.

2.  There is a website where you can go to determine if your employer has self-insured its benefits plan or not: http://freeerisa.com/.  You first will have to set up a free account, but it is relatively easy.  Then, do the following:

  • On the home page find “FREE Reference Databases:” toward the bottom.  Under that click “ERISA Form 5500 Filings.”
  • Enter your employer’s name in the box “Search for.”  Click the name of your employer in the search results.
  • You may find more than one version of your employer’s name.  In that case you may need to review benefit plans under both names to find the correct plan and the most recent year.
  • If you find more than one benefit plan under your employer’s name, find the one that has the latest plan year data (most likely 2005 or 2006).  Then, look for and click the health benefits plan – ignore any separate listing for pension, profit sharing, dental, life, and accidental death (ADD) plans.  All of these plans may be lumped together in a single plan.
  • On the first page that you come to, look for item 9a, which will look like this:

9a Plan funding arrangement (check all that apply)

(1)  / /  Insurance

(2)  / /  Section 412(i) insurance contracts

(3)  / /  Trust

(4)  / /  General assets of the sponsor

    • If box 4 is not checked, for that year, no part of your employer’s benefits plan was “self-insured” or “self-funded.”  In that case, box 1 should be checked.
    • If boxes 1 and 4 are checked, the Form 5500 applies to more than one plan.  The checked box 4 will only be a clue that your plan may be self-insured.  You will need to do some more digging.

3. If you work for a public company, the company should discuss any health plan self insurance in its Annual Report on Form 10-K; but, not all companies fully comply with this disclosure requirement:

  • Go to http://www.sec.gov/edgar/searchedgar/companysearch.html.
  • Enter your company’s name (or part of it so that the search results include either a list of company names or a list of filings for your company).
  • If there is more than one company listed, click the name of your company.
  • In the box on the upper right called “Form Type, type “10-K.”
  • Click the most recent filing.
  • Search for references to “self-insurance”:
    • In the financial statement notes (located after the financial statements – balance sheet, income statement, etc.):
      • If you do not have experience reading financial statements, this step may be difficult.
      • In the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”  Self-insured companies should, but do not always, discuss the process for estimating its self-insurance costs, as well as explain and estimate the risk that the costs could be greater.

If box 4 is not checked on ERISA Form 5500, or if your company does not discuss self insurance in its Form 10-K, it is still possible that the Florida autism insurance mandate will not help you.  Many employers that would be subject to the mandate if it applied today can change their plan structure before the effective date.  Your employer could have already changed the plan structure for the 2008 plan year.  That would not show up on freeerisa.com until 2009 or 2010.  Your employer also may change its plan structure before your first plan year (in many cases January 1, 2010) that starts after April 1, 2009, the date on which the mandate becomes effective (Chapter 2.)

Plan structure changes may include self-insurance (Chapter 6) as well as purchasing insurance from an insurance company that signed the developmental disabilities compact or signing an HMO contract with an HMO that signed the compact (Chapter 5).

These general answers may or may not apply to your specific circumstances.  You should consult a lawyer or other specialist if you think you are entitled to benefits that you do not receive.  Behavioral Lifeboat can help you do that.

If you have questions, please comment below.

© 2011 Behavioral Lifeboat, Inc.

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About Behavioral Lifeboat

Behavioral Lifeboat is a nonprofit organization. Our mission is to make evidenced-based behavioral therapy accessible to all by increasing awareness, helping to make comprehensive insurance benefits affordable and meaningful, helping schools provide more effective behavioral therapy programs, and providing grants to make such therapy affordable when other solutions are not available.

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