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HomeMy WebLinkAboutOB ADOPTION H.M.O. 11-17-80DATE: TO: FROM: SUBJECT: November 12, 1980 OLD BUS/NESS  No..1 . 11v~7.~80 Inter - C om Mayor and City Council Roy Gonzales, Personnel Director'~ Adoption of Health Maintenance Organization BACKGROUND The HMO question was initially raised in April of 1979 through contact from Maxi- care who "mandated" the City according to Federal guidelines. Those guidelines provide that an HMO can file an official request for inclusion among an organi- zations health plans. If such a request is filed', the organization must offer an HMO as part of their program, though they are not restricted to including the specific HMO which contacted them. Action on the HMO question was deferred until the employee negotiations in 1980. Both Family Health Plan (FHP~ and INA Healthplans (then California Medical Group Health Plans) were contacted and presented proposals. With the change, in Personnel Directors prior to the employee nego~%ations, the fact that this issue was being considered was lost. Since neither association'raised the issue, it was not in- cluded in the negotiations process. Shortly after the close of employee negotiations, the issue was raised by the Tustin Police Employees Assoication and through the Employee Relations Committee. Since the Federal guidelines protect employers against bearing any additional cost through the addition of an HMO, this was not viewed as an item which must be in- cluded in the salary negotiations, so the City proceeded with the review process. During this process, INA Healthplans indicated that they would also "mandate" us for inclusion, but did not because I assured them they would be included in any consideration. The HMO's included in this process were identified through the existing background research, including a report on HMO's prepared by the Robert F. Driver Company for use by OCC~4A Cities comparing HMO's in terms of services and costs. Attached is comparison information for the three organizations presented for employee review. Discussion There are several options available to the Council which are discussed below. 1. Approve and support the decision to include FHP as an HMO for employeeS. 2. Open bids for a Health Maintenance Organization contacting all Health Mainten- ance Plans which serve the Tustin area. Mayor and City Council November 12, 1980 Page Two 3. Not offer an HMO until such time as it can be included in the Meet and Confer process during employee negotiationsJ Since several options were presented to the Employee Associations, including their association representatives, option 3 has been effectively met. There is no financial liability to the City, and, therefore, no benefit to including HMO's as a salary negotiations item. Those HMO's which have facilities in an area which could effectively serve Tustin were included in the review process. It is unlikely that there would have been any significant change in the available plans, though several new HMO's have been started recently, including one through Blue Cross. Most new HMO's are of the Individual Practice Association type, and would not be able to offer the employees the centralized services nor the overall strength offered by the two plans seriously reviewed by the Employee Review Committee. In addition, any change from FHP would have to be reviewed and approved by both associations, or by a review committee as was previously established. The Federal guidelines require that, if covered by legislation such as Myers-Milias-Brown which required an employer to Meet and Confer, the employee must present any HMO to the associations involved for approval prior to offering it to the employees. Recommendation That the City Council take action to adopt the Family Health Plan (FHP), a feder- ally-qualified Health Maintenance Organization (HMO) as an alternative choice for employees for their Medical and Dental Benefits. RPG/kaf Attachments cc: Dan Blankenship FHP 'MEDICAL PLAN B SECTION B .-- BENEFITS IN AN FHP MEDICAL CENTER PHYSICIAN'S CARE SPECIALIST AND CONSULTANT CARE DIAGNOSTIC LABORATORY TESTS And X-ray examinations. PERIODIC HEALTH EXAMINATION Including chest X-ray & laboratory. ROUTINE IMMUNIZATIONS AND INJECTIONS WELL-CHILD CARE Including routine immunizations. PHYSICAL THERAPY EYE EXAMINATIONS OUTPATIENT MENTAL HEALTH SERVICES For short-term evaluation, treatment and Crisis intervention provided in designated FHP Medical Centers. FAMILY PLANNING SERVICES Contraceptive counseling; IUDs provided when indicated. Sterilization procedures and services for infertility., Abortions. Abortions for life-threatening pregnancies. FHP MATERNITY CARE Physician's care of mother before, during and 6 weeks after delivery; physician's hospital care of mother. No waiting period. Newborns are covered from birth if enrolled as a dependent within 31 days of birth. HEALTH EDUCATION Includes classes, literature and audio-visual programs for specific diseases, preventive medicine and other health toFics. Provided in designated FHP Medical Centers. PLAN COVERS You pay $//each office visit. O PLAN COVERS Up to 20 visits per member each benefit periodl You pay $~,~ each office visit. 0 PLAN COVERS Regular office copayments apply. PLAN COVERS 50% of all costs, including hospital. PLAN COVERS Regular benefits apply after $50 copayment. Regular benefits apply. PLAN COVERS You pay SdS'each office visit. , You pay nothing for physician s hospital care. For hospital costs, regular hospital benefits apply. PLAN COVERS IN FULL You pay nothing. 7920-127 6/191(K FHP B/IED CAL PLAN B SECTION B -- BENEFITS -iN AN FHP HOSPITAL HOSPITAL CARE Including room and board (semiprivate, private room when ordered by an FHP physician), intensive care, coronary care, cardiac surgery, dialysis, radiation therapy, cathode ray scanning and other inpatient hospital charges such as operating room, drugs, X-ray, lab, supplies and i anesthesia. PHYSICIAN'S & SURGEON'S CARE - BLOOD AND BLOOD DERIVATIVES PLAN COVERS IN FULL You pay nothing.. PLAN COVERS IN FULL You pay nothing. PLAN COVERS Cost of administration only. You pay for, or replace, blood or blood derivatives..~. -OTHER BENEFITS j SKILLED NURSING FACILITY CARE ~ IN-AREA EMERGENCY CARE ~y non-FHP physicians for necessary medical services to members requiring immediate treatment __ anywhere in the FHP service area where or when FHP services are not available. OUT-OF-AREA EMERGENCY CARE By non-FHP physicians. Worldwide emergency. health coverage. Necessary medical services to members requiring immediate treatment while temporarily outside the FHP service area. LOCAL AMBULANCE When medically indicated and authorized by an ?HP physician. HOME HEALTH CARE Health services provided at the home of an enrollee as prescribed or directed by an FHP physician where medically appropriate. ~ LCOHOL AND DRUG ADDICTION uR ABUSE SERVICES Includes short-term detoxification on an inpatient or outpatient basis, as determined by an FHP physician, and related medical conditions. PLAN COVERS Up to 30 days. PLAN COVERS IN FULL FHP must-be notified within 48 hours to determine validity and extent of coverage. PLAN COVERS IN FULL FHP must be notified within 48 hours to determine validity and extent of coverage. PLAN COVERS IN FULL You pay nothing. PLAN COVERS IN FULL You pay nothing. PLAN COVERS You pay $4~each office visit. Regular hospital benefits apply for hospital care. FI P EDICAL PLAN SECTION B -- BENEFITS ADDITIONAL BENEFITS OF THIS PLAN FAMILY SECURITY BENEFIT . In the event of the subscriber's death, medical care benefits will be continued for f~-mily members covered by FHP on that date without payment of premiums until the earliest of the following occurrences: 1. Remarriage of the surviving spouse, in which case coverage for all family members terminates. 2. Family member qualifies for Medicare (there is no continuation of benefits for a family member who is already eligible for Medicare at' the time of the subscriber's death). 3. Family member ceases to qualify as a family member for any reason other than lack of primary support by the subscriber. ' 4. Two years lapse from the date of the subscriber's death. In the event of the surviving spouse's death v~ithin the two-year (maximum) continuation of coverage period, coverage continued for family member children because of the subscriber's death will not be affected. The Continuation of Benefits provisions apply to family members when coverage provided by the Family Security Benefits terminates. SUPPLEMENTAL BENEFITS OF THIS PLAN PRESCRIPTION DRUGS PLAN COVERS All FHP prescribed drugs, including birth control pills, on generic formulary at FHP Medical Center pharmacies. You pay $2 per prescription unit. COPAYMENT MAXIMUM Health services in this medical plan may require a nominal copayment at time of service. These copayments help FHF' keep the cost of the medical plan as low as possible. However, to ensure that these copayments never become a barrier to receiving care, FHP maintains the following policy: When copayments made by a member during one calendar year total $550, then no further copayments will be imposed upon the member for the remainder of that calendar year. The aggregate copayment for a family unit is three times the annual individual copayment maximum. This provision does not apply to any payments for eyeglasses, prescription drugs, preventive dental services, in- hospital mental health services or other Supplemental Benefits of this plan. Members are required to keep receipts of copayment expenditures and furnish such proof to the FHP Health Plan Office when copayment maximum is reached. ~ 79111-Z37 10/79Kl FHP ED CAL PLAI SECTION C -- EXCLUSIONS The following are excluded from coverage under this plan: o Prescription drugs and eyeglasses unless herein provided. ' .... ~ Contact lenses, examination for contact lenses and v. isual training. ~ Dental services except as herein provided. ~ Corrective appliances, artificial a~ds (with the exception of prosthetics following mastectomies) and durable medical equipment unless herein provided. - ~ Cosmetic surgery, unless medically necessary. ® Custodial care, domiciliary care, rest cures. o Inpatient mental health care unless herein provided. ~ Care for conditions which State or local law requires be treated in a public facility. '~ Care for military service connected disabilities to which a member is legally entitled, and for which facilities are reasonably available to the member. ~ All services and items incident to the improvement of the functioning of a malformed body member or system, unless determined by an FHP staff physician to be medically necessary. - ~ Those services and items not reasonable and necessary for the diagnosis or treatment of illness or injury, as determined by an FHP staff physician. ~ Experimental medical, surgical or other experimental health care procedures, unless approved as a covered health service by the policy- making body of FHP. o All services and items not provided or arranged by an FHP staff physician, with the exception of in- and out-of-area emergency care. ~ Rehabilitation for long-term neuromuscular conditions. ~ Rehabilitation for drug or alcohol abuse. -- o Blood and blood derivatives. ~ Hospital take-home drugs. ~ Benefits and services not specified as covered. 80111-139 IN AN FHP DENTAL CENTER (Subject to Limitations and Exclusions) DIAGNOSTIC: Routine X-rays, clinical examina- tions and other diagnostic dental services. PLAN COVERS IN FUll - You pay nothing. ANNUAL DEDUCTIBLE APPLIES TO ALL SERVICES LISTED BELOW. YOU PAY BEFORE COVERAGE BEGINS. YOU PAY THE FIRST 550 PER INDIVIDUAL PER BENEFIT PERIOD. PREVENTIVE * Routine teeth cleaning "Applications of fluorides to the teeth "Instruction in methods of cleaning the teeth · Space maintainers · Habit-breaking appliances * Treatment of early stages of gum disease (scaling, curettage and root planing). RESTOIL&TIVE: Routine fillings (silver amalgam or synthetic porcelain), l':ulp caps;~ EMERGENCY CARE Al' FHP DENTAL CEN[ERS or as provided by the FHP staff dentist on call. Emer- gency treatment for acute infection, pain and bleeding or for accidental injury to the teeth and adjacent soft tissues. PRESCRIPTION DRUGS For drugs prescribed by FHP staff dentists. OPAL SURGERY: Routine extractions, extractions of impacted teeth and other necessary oral surgery. , PLAN COVERS IN FULL You pa:/nothing after deductible requirement has been met. ENDODONTICS: Root canal fillings, pulpal therapy. PERIODONTICS: Treatment of the soft tissues and bones supporting the teeth. Periodontal consultation, surgery and other therapy. ,. PLAN COVERS 80% of charges. PROSTHEI'ICS: Full and partial dentures; crowns and bridges; repairs, relining and/or reconstruction of dentures. · PLAN COVERS 50% of charges. OUT-OF-AREA EMERGENCY CARE By non-FHP staff dentists. Dental services to members requiring emergency treatment while temporarily outside FHP's designated service areas. PLAN COVERS Usual, custo~nary and reasonable charges up to $50 each occurrence. FHP must be notified within 30 days. PLAN MAXIMUM UNLIMITED ADMINISTRATIVE FEE: Should you fail to keep an appointment or fail to notify the dental office of a cancellation 24 hours in advance, you may be assessed a $10 service charge. THE FOLLOWING ARE LIMITATIONS OF THE BENEFITS PROVIDED IN THIS PLAN Treatment of dental emergencies is limited to treatment that will alleviate acute symptoms and does not include definitive restorative treatment including, but not limited to, root canal treatment 'and crowns, unless otherwise provided Replacement of prosthetic appliances less than five years old is covered only when good dental care dictates and such replacement is prescribed by an FHP dentist · Porcelain pontics or facings on crowns will be provided only on those teeth anterior to and including the upper first molar and the lower first premolar · Single unit gold restorations and crowns are covered as provided above, only when the tooth cannot be ; adequately restored with other restorative materials i E (CLU$1ONS THE FOLLOWING ARE EXCLUDED FROM COVERAGE UNDER THIS PLAN ·implaats of any kind : Surgical grafting procedures Congenital or developmental maiformations; including, but not limited to cleft palate, enamel hypoplasia, fluorosis (brown and white stains of the teeth), 'maxillary and mandibular malformations and anodontia · General anesthetic ° Cosmetic or orthodontic treatment, unless specifically provided as an additional benefit · Full mouth rehabilitation, periodontal splints, restoration of tooth structure lost from attrition and restoration for malalignment of the teeth ~' Temporomandibular (jaw) joint disorders and related disease · Any single procedure or procedures (including bridges, dentures root canals) started crowns, or prior to the date the member became eligible for such services under this Agreement. * Conditions covered by any act of war or result of service in any armed service * Charges incurred while confined as an inpatient in a hospital * Treatme:,.t and/or removal of oral tumors · Treatment of traumatic injuries except injuries of the teeth and adjacent soft tissues as provided in covered benefits ~Replacement of lost or stolen dentures, bridges or other dental appliances ; ~ Benefits and services not specified covered as 'F z ~C 0 0 · '~ 0 0 0 O- 0 0 0 0 0 0 0 C 0 ~ ~ ~ ~ ~ ~< 0 '2 '~ -o 'o o INA Healthplan of California Health Care Centers -$0180 SOUTHERN CALIFORNIA LOS ANGEL~.~ SANTA BARBARA 805 W. 57th St. Los Angeles CA 90037 213 753 3133 (MP) 3210 Long Beach Blvd. Long Beach CA 90807 213 426 9393 (D) 401 S. Fair Oaks Ave. Pasadena CA 91105 213 796 8173 (MEDVP) 7339 El Cajon Blvd. La Mesa CA 92041 714 464 8482 (M) 3031 S. Vermont Ave. Los Angeles CA 90007 213 737 7000 (MEDVP) 887 E. Second St. Pomona CA 91766 714 623 6981 (MEDVP) 10875 San Fernando Rd. Pacoima CA 91331 213 896 5371 (MDVP) 11275 W. Olympic Blvd. Los Angeles CA 9O064 213 478 6571 (MP) 2220 Clark Ave. Long Beach CA 90815 213 597 3653 (MEVP) 40 E. Alamar Santa Barbara CA 93105 805 682 2461 (MDVP) Dental Office 805 687 3474 M--Medical E--Open 24 hours 7 days a week 909 N. Sepulveda Blvd. El Segundo CA 90245 213 640 1200 (MDV) Optometry Office 999 N. Sepulveda Blvd. El Segundo CA 90245 213 640 1023 2435 N. Grand Ave. Santa Aha CA 92701 714 835 4850 (MEDP) Dental Office 714 547 6075 10454 E. Valley Blvd. El Monte CA 91731 213 579 6010 (MDVP) 1937 W. Chapman Ave. Orange CA 92668 714 978 6266 (MVP) 7111 Winnetka Ave. Canoga Park CA 91306 213 888 3120 (MDVP) 1401 S. Brookhurst St. Fullerton CA 92633 714 773 4844 (MDVP) 9155 Telegraph Rd. Pico Rivera CA 90660 213 949 9631 (MVP) 14501 Magnolia St. Westminster CA 92683 714 891 5441 (MVP) D--Dental V--VislonCare P--Pharmacy INSURANCE & PREPAID BENEFITS TRUST (i.B.T.) TWO PLANS OF HEALTH CARE BENEFITS Administered By: INSURANCE BENEFITS, INC. (714) 832-7900 -- 150 SO. PROSPECT AVE., TUSTIN, CALIFORNIA 92680 "E" SCHEDULE OF BENEFITS -- INTERCHANGEABLE WITHOUt. NOTICE SERVICES AND COVERAGES Benefits are the same for employees and all eligible dependents HOSPITAL SERVICES HOSPITAL SERVICES Such as operating room, anesthetist, drugs, dressings, X-rays, lab tests, etc. PLAN 1 When you use the. doctors and hospitals on I.B.T.'s PANEL you pay only the amounts hsted below, if any. No deductible. 90% Coverage -- for up to 365 days, per disability. In a semi-private room. PLAN 2 When you use any doctor or hospital of your choice who is not on LB.T.'s PANEL, you receive the hsted percentages of the amount of charges. You must pay the doctor or hospital the dillerence between the amounts listed and ',heir cba~ges: 90% Coverage -- after deductible is S 100.00 is met. In semi-private room for up to 365 days per disability. SURGERY-- Includes pre and post operative ca re. Operating surgeon. Assistant surgeon. Anesthetist 90% Coverage (See Extra Accident Coverage below) 9096 Coverage -- after deductible is met. (See Extra Accident Coverage below) DOCTOR'S VISITS Includes visits to specialists. In the office. In the hospital. At your home. Payment for surgery include pre and post operative visits. Full Coverage -- No Charge Full Coverage -- No Charge 90% Coverage 90% Coverage -- after deductible is met, of reasonable, usual and customary charges. INJECTIONS Immunizations, Hormones, etc. given in a doctor's office. AMBULANCE to and from a hospital RADIOLOGY (X-Rays) PATHOLOGY (Lab Tests) VISION CARE REFRACTION (Tests for eye glasses) Available from I.B.T.'s Panel optometrists only. MATERNITY BENEFITS (including complications) Nervous or mental conditions (in hospital benefit only}. DENTAL CARE Available from I.B.T. Panel dentists and dental specialists only. SPECIAL ACCIDENT BENEFIT Care received within 90 days from date of accident. You pay $2.00 per visit. Full Coverage -- No Charge. Not provided in Plan 1: YOU receive benefits from the first visit for sickness and accidents. 90% Coverage -- after deductible is met, of reasonable, usual and customary charges. You pay only $2.00 per injection. You pay all charges over $25.00 per trip. You pay $2.00 per unit** You pay $0.20 per unit** 90% Coverage -- after deductible is met. 90% Coverage -- after deductible is met. 90% Coverage -- after deductible is met. 90% Coverage -- after deductible is met. Provided at reduced fees. Not Covered in Plan 2 Normal plan benefits after a S5OO separate pregnancy dedL~tible. 90% Coverage Members pay reduced fees. Normal plan benefits after a $1000 separate pregnancy deductible. 90% Coverage -- of eligible expenses, up to $2,000. Not covered in Plan 2. The first $300.00 of charges for an accident are 100% covered with no deductible or co-payment. The first $300.00 of charges torah accident are 100% covered with no deductible or co-payment.** SKILLED NURSING HOMECARE for care commencing after 3 days of con- ~,inement in an acute hospital. (Curative treatment only). PRESCRIPTION DRUGS Provided outside of a hospital MAJOR MEDICAL EXPENSE A $1,000,OO0-1ifetime maximum tot ail ot the listed coverages is provided for each eligible individual on both Plan I and Plan 2 combined. Maximum renews up to $1,000 each year per covered individual. Maximum -- 3 deductibles per family. I.B.T. will pay 90% of semi-private room charges for up to 20 days per disability. Provided at reduced fees. There are no deductibles on Plan 1 basic benelits shown above, except maternity. Co-payments payable on Plan 1 are not considered a part of the deductible. "- California Medical Association Relative Value Schedule 5th Ed. (1974 Edition) 90% Coverage -- after deductible is met. In semi-private room up to a maximum gl $35 per day for 20 days per disability. 90% Coverage -- after deductible is met. Each covered person pays the first $'100 (the deductible) per calendar year and then receives 90% of the cost of reasonable charges for the above benetits and for intensive care in a hospital (up to $225. per day), rental of iron lung and other thera- peutic equipment., artilicial limbs or eyes replacing natural ones, brivate nursing care, physical therapy, hemodialysis0 organ frans- plants, electronic pacemakers. ;.E.T. 553 EI00-90 SP/UCR INSURANCE AND PREPAID BENEFITS TRUST (I.B.T.) OUTLINE OF FACILITIES ACOURA ALHAHBRA ALTADENA AXAHEIM AUBURN 5AKERSFIELD BALDWIN PARK 5ARSTOW 5ELL 5ELLFLOWER 5REA -' 5UENA PARK _iURBANK CANOGA PARK NYON COUNTRY ~;ARLSBAD CHATSWORTH CHINO CHULA VISTA CITRUS HEIGHTS ZiTY OF INDUSTRY ~LAREMONT %OACHELLA COMPTON CONCORD CORONA COSTA MESA COVINA ,£ULVER CITY 2AHA POINT i~EL MAR DiAbIOND BAR DOWNEY -- LL CAJON ~ MONTE EL TORO (p) ENC1NITAS (?) (DER~[) (POD) (OP) ENCINO (IHT MED) (RAD) (RH) (OP) (P) (S) (W) (OB/GYN) ESCONDIOO (HERM) (ONC) (POD) FOUNTAIN VALLEY (LAB) (PT) (RX) (DDS) (OD) (A) (DDS) (P) (H&ER) (DDS) (A) FREMONT (OB/GYN) FRESNO (P) (PED) FULLERTON (S) (P) (OB/GYN) (IHT MED) GARDENA (HEMA (HEPH) (H) (OD) GARDEN GROVE (CIIIRO) (DDS) (OD) (P) (PED) (OB/GYN) (INT MED) (S) (RAD) (LAB) (POD) (H) (RX) (DDS) (A) (CHIRO) (DDS) (OD) (P) (ENDO) (OB/GYN) (HEHA) (FED) (DDS) (p) (DDS) (P) (POD) (RAD) (ORTItO) (PT) (PED) (IHT MED) (CARD) (A) (Al.) (RX) (DDS) (DDS (P) s) (A) (P) (P) DDS) (OD) (DDS (P) S) (DDS) (A) (DDS (P) (IHT MED) (ENT) (S) (H) (DDS) (OD) (ORTHO) (P) (OD) (P) (OPHTtt) (DERM) (OD) (P) (DDS) (A) (DDS) (OB/GYN) (PED) (DDS) (DDS) (OD) (P) (PED) (OB/GYN) (IHT MED) (S) (]lAD) (LAB) (CHIRO) (DDS) GLENDALE CLENDORA GOI, ETA GRANADA HILLS HACIENDA HEIGHTS HAWAIIAN GARDENS llAWTHORNE HOLLYWOOD HUN'F INGTON BEACH HUHTINGTON PARK IHDIO INDUSTRY INGLEWOOD IRVINE LACUNA ItlLLS LACUNA NIGUEL LA JOLLA LAKE ELSINORE LAKESIDE LAKEVIEW TERRACE LAKEWOOD LA MESA (CHIRO) (DDS) (ORTHO) (OD) (DERM) (PED) (PROCT.- (S) (PT) - (RX) (DDS) (S) (CHIRO) (DDS) (DERM) (U) (DDS) (ORAL S) (P) (PED) (INT. (OB/GYN) (S) (LAB) (DDS) (ORTHO) (p) - (P) (CAST) (OPTH) (LAB) (DDS) (ORTHO (DDS) (OD) (D) (S) (IHT MED) (}~E~A) (ONC) (NEPH (OPHTH) (P)(R/CARD (LAB) (PT) (DDS) (ATTY) (P) (S) (OB-GYN) (OB-GYN) (ORTHO) (P) (S) (ORTHO) (DERH) (DDS) (P) (HOSP) (ER) , (DDS) (POD) (DDS) (OD) (P) (DDS) (P) (PED) (DERH) (OB/GYN) (S) (PT) (DDS) (OD) (ATTY) (DDS) (P) (s) (DDS) (P) (AL) (ENT)(POD (INT. MED) (S) (U) (OB/GYN) (DDS) (OD (P) (RAD) (PT) (PED) (OD) (P) (CARD) (INTMD (PED) (CHIRO) (RX) (DDS) (OD) (P) (ORTHO) (DDS) (A) (OD) (?) (P) (I~T.ME~) (P~D (CARD) (OB/GYN) (HOSP) (ERS) (P) (S) (DERM) (OD (DDS) (ORTHO) (P) (S) (DDS) (OD) (A) aEV. 8/80 ~,,\ MIRADA ANCASTER '~ PALMA PUENTE _ ,x VERNE ~AWNDALE !'~ MO N GROVE !)>lA LINDA .!NC BEACtl ALAMITOS ANGELES --.YNWOOD ANHATTAN BEACH iARINA DEL REY --~ARINWOOD \YWOOD fSSION HILLS ~SSiON VIEJO ~NTCLAIR ~!NTEBELLO TEREY PARK ~FIONAL CITY idWBURY PARK 'EWIIALL !(WPORT BEACH ~) R'I'II HOLLYWOOD :ORTtlRIDGE -- ~ORWALK 7:OVATO PAKLAND '- !CEANSIDE ;NTARIO >RANGE )XNARD IFICA :.~M DESERT iALM SPRINGS · ANORAbIA CITY (Page 2) (DDS) (oRTIIO) (P) (P) (H~aA) (~N~ ME~) (NEPIt) (OPIIT) (LAB) (P) (~DS) (OB/GYM) (DDS) (O~?HO) (OD) (POD) (HOSP) (ERS) (P) (PED) (OB/GYM) (iHT MED) (S) (RAD) PASADENA P E R R l S PICO RIVERA PLACENTIA PLACERVILLE POMONA ROWLAND HEIGHTS SACRAHENTO SAN BERNARDINO (LAB) (AL) (DERM) (DDS) PORT HUENEblE (ORTHO) REDLANDS' (ORAL S) REDONDO BEACH (OP) OB/GYN) (S) (AL) RESEDA (DERH) IHT MED) (ENT) RIVERSIDE (U) (PED) (RAD) (POD) (CHIRO) (HOSP) (ER) (RX) (DDS) (ORTHO) ROSEMEAD (ps) (s) (RX) (ORTHO) (OD) (D) (s) ( ORTHO ) (DDS) (OB/GYM) (IHT MED) OMC) (PED) SAN CARLOS OD) SAN CLEMENTE DDS) SAN DIEGO OB/GYM) (DDS) (ORTHO) P) (OPHTH) (OD) P) (OB/GYN) (PED) HOSP) (ERS) (RX) DDS ) ORT}IO) SAN DIMAS OB/GYH) (IHT HED) SAN FJRNANDO NEPH) (POD) (DDS) DERM) (OPHTH) (PT) SAN FRANCISCO l') (iN'r blED) (POD) SAN GABRIEL LAB) (RX) (ORTHO) SAN JOSE OD) IHT MED) (HEMA) (NEPH) SAN MARCOS OPItTil) (POD) SAN PEDRO P) (PED) (ENT) (CHIRO) SANTA ANA DDS) (ORT}IO) ORTtlO) DDS) DERM) (DENT XRAY)(A) AL) (DERM) (OD) P) (PED) (OB/GYN) SANTA BARBARA IHT MED) (S) (RAD , SANTA MONICA LAB) (AL) (U) (S) CARDIO) (S-VASC) OD) SAUCUS (HOSP) (A) SHERbIAN OAKS (~NT ~I~D) (ORTHO) SIMI VAI, LEY (P) (AL) (IHT MED) (S) (OD) SOUT!i GATE (PED) (RADIO) (NUC MED)' (ULTRA SOUND) (POD) SOt!Ti{ I,AGUNA (IIOSP) (ERS) SOUR'Il TORRANCE (P) (OB/GYM) (IHT HED) (DDS) (ORTUO) (P) (SURG) (OD) (Z~T. ~ED) (DERM) (OPTH) (OD) (DDS) (P) (ENT) (IIOSP) (ERS) (RX) (DDS) (A) (ORTtlO) (CHIRO) (P) (CHIRO) (DDS) (POD) (DDS) (P) (OB/GYM) (DDS) (IHT MED) (RAD) (u) (op) (P) (AL) (ENT) (rED) (s) (POD) (RX) (RX) (OD) (IHT MED) (DDS) (P) (CHIRO) (DDS) (ORTHO) (A) (ORTItO) (ORTHO) (P) (OB/GYM) (RAD) (PT) (S) (S-THOR) (DERH) (OPHTH) (POD) (CHIRO) (RX) (HOSP) (ODS) (OD)' (ORTHO) (A) (DER~) (P) (OB/GYM) (PED) (DDS) (P) (S) (DDS) (P) (ItOSP) (DDS) (P) (IHT FLED) (ORTHO) (DDS) (DDS) (S) (ORTHO) (DDS) rS) (PT) (IHT MED) (RAD) (S) (AL) (PED) (CARD) (OB/GYM) (CHIRO) (LAB) (OD) (HOSP) (ERS) (DDS) (ORTH) (P) (DOS) (P) (OB/GYM) (U) (LAB) (DDS) (P) (NEPtt) (RAD) (U) (PLAS S) (DDS) (P) (I'T) (GYM) (S) (HOSP) (RX) (P) (OB/GYM) (PED) (s) (ORT}iO) (~DS) ( ORTtlO (DSS) (DDS) SI;R ING VALLEY STANTON SUNLAND SUN VALLEY SYLMAR TARZANA THOUSAND OAKS TORRANCE TUSTIN UPLAND VALENCIA VAN NUYS VENICE VENTURA VICTORVILLE WEST COVINA ' WESTLAKE WEST HOLLYWOOD WEST LOS ANGEl. ES WESTHINSTER WHITTLER .IOODLAND IIILLS YORBA LINDA OUT OF STATE COLORADO TRINIDAD KANSAS PARSONS NEVADA LAS VEGAS (DDS2 (P) (PED) INT blED) (s) (HOSP) (ERS) (P) (PROCT) (s) (D~s) (P) (0R'ruo s) (DDS) (OB/CYN) (OB/GYN) (S) (ORTHO (DDS) (ORT~tO) (OD) (^) (P) (CARD) (INT MED (R8) (S) (VASC) (POD) (PT) (RX) (OD) (A) (ENT) (OD) (A) (v) (OPHTH) (DDS) (A) (P) (DDS) (ORTHO) (p) (A) (P) (INT MED) (S) (OD) (THOR) (~ ~D) (^) (O~?HO) (INT MED) (OPHTH) (P) (DDS) (OB GYN) (INT MED) (HEMA) (ONC) (FED) (U) (LAB) (DD'S) (OB-GYN) (I)ERM) (DDS) (OD) (P) (HOSP) (ER) (OD) KEY: A - attorney HEMA AC - arthritis INT AL - allergy LAB CARD - cardiology NEPH CHIRO - chiropractor NEUR D - dentist O DERM - dermatology OB/GYN ENT - ear, nose, throat OPTH 7NDO - endocrinology ONC GAST - gastroenterology ORTHO t! - hospital OP - hematology - internist - laboratory - nephrology - neurology - optometrist - obstetrician/gyn. RX - opthamology S - oncology U - orthodontist - orthopedist (Page 3) PED - pediatrics POD - podiatry P - primary PT - physical therapy RAD - radiology RH - rheumatology - pharmacy - surgery - urology Galbraith & G-. aen, Inc. SUL~JECi': ilealth Hainkenance Organization .ATE: October 12, 1977 ARTICLE: 31 In the past, we i]ave advised you of the federal le,.~islation regarding Ilealth [!ainte-. nance Organizations (lii.10's). Tile followi]g is the r.;ost recent update and review of the law for your perusal. 'F ':here are any questions, please let us know. OFFERIJG THE OPTION OF HMO MEMBERStt.I?: A. Who Must Offer the HMO Option. An employer must offer its employees the option of HMO membership if the employer: (1 offers a health benefit plan to its employees; was subject to federal minimum wage laws during any quarter of the previous year in which he employed an average of at least 25 employees; and (3 receives a written request from a qualified Itt10 operatin? in an area in which any eligible employee resides, i-?,e iffiO must make the request at least 1~'=~ n~alt o~ days before the expiration or renewal date of the benefits contract or employer/employee contract or at least ?0 days before the expiration date of a collective bargaining a.greement. The "renewal date" of a collective bargainint: agreement is (i) the anniver- sary date if the agreelnen~ has no fixed te~rnl, or (ii) such other tin:es no less than annually, as an agreement ,...,iti~ a fixed term may provide for discussion of changes in its conditic;m. The employer ~z~ay insist UiaL the H~iO provide extensive information regarding its opera tions with iks requesL, because ~.~ regulations list a wide variety of documents which the FU!O must forward to the employer to~,.a~, '~ i~"- request effective. These include: ideotification of health professi ' ~s providing care, identification of ownership and managemen~ of the Hr-lO, copies of current financial statements and information on capacity for new enrollments. INn employer who must make an Iii.lO offer may name a designee to de so. lhis iLeans that the employer may authorize the trustees of a Taft-',iart!e.,/ plan to offer the ttIiO option. Who ............ iiust Be Offered the ltI.'lO Option. The employer or its designee must offer the il..~L) option to all employees who are .,~' ~r benefits under the terms of the employer's existing h~alth benefits plan and who reside within the service area of the HMO being offered. The current law requires that at least 25 employees live in the Ili!O service area in order to subject their employer to the HMO offer requirements. If ti~ese employees do not have a bargaining representative, the offer must be made to them directly. However, if those employees have a bargaining representative, the offer must be made Galbraith & G. .en, Inc. rive turns down the UH0 offer, the employe~ has no further obligation to make the offer to individual employees. C. ',,./hen the HMO Offer Must Be Made. Offer to B__~r~:9_i_n_in~g_~_epresentatives. The HMO off.er must be made "at .the earliest date permitted under the te~',:s of the existing contracts", tf a collective baa'gaining agreement is ~n force when the HHO makes its request, the cequest ~::ust be raised in the collective bargaining process at one of the following times: when a new ,.:c.qtr?ci' is negotiated, on the date that the contract automatically renews, at the time the contract provides for discussion of changes, or at the time the ce::tract provides for review of HHO offers, .. (2) Offer to E~ployees. If the employees' bargaining representative accepts the Iii. lO offer, the employer or its designee must extend the offer to employees who are eligible for health benefits under the employer's · t.,., service area. The employer or e>:~sting plan and who reside in the Mn designee must give each such employee the opportunity'to choose between the HMO and non-HMO health benefit plan during an annual "group enroll- F. tent period", which 'lasts for ten working days each calendar year. In addition, the HMO and non-liMO a!ter.~,at~ve must be offered to (i) new employees, (ii) employees whose change of' residence make them newly eligible for ~:.*;0 membership and (l~i) emF;loyees covered by an alterna- ~i:,e that ceases operation. How the Fi,lO Offer :.:ust be Iiade. The empioyeF or designee must give each HMO ~-~-i-C~.-T~-T~Tt~J~ in its ~h benefits plan an opportunity to explain its pr'ogF~n~ ~o eligible employees for a period of not less than 30 days prior to and d~:ring group en~ol lment per~ods At a :..~inimum this means the employer :"ust al!ow the t-l~.'.~b to distribute educationai literature and announcements of meetiu~'s to employees The en;pl¢¥,er or d=signee may ,-eview the HI.10 I~teratur-e for purposes of correc- ting fac~.ual e~rors or misleading or amb:guous statements prior to distribution. When t!~e ',aide offer is first made to'a group of employees, the employees must make an aff~rmat;~e :.,'ritten selection among the alternative health benefits progra;:s lntro,:uctory comments to the regulations state that "the conse- quence cf an employee's failure to make any such written selection is a matter between the employer and the employee", in subsequent enrollment periods, a written selection is only required when an employee elects to change from one atterna:]ve to another. The iiF'.O offer' must be made to etigib!e employees without waiting periods of exclusions or ?imitations based on health status The Ter~z:s of the ~:.;0 Contract- Decisions regarding supplemental HMO services and co-payment Tevels for HMO services are sub3ect to the collective bargaining process The erJ!ployer is riot required to pay more for health benefits as a result of offering the HMO option than the employer would otherwise be required to pay Lundlr the col~ec[ive bargaining agreement or employer/employee contract in Galbraith & G. ~en, Inc. U :DATE effect at Um ti::!e the I1~I0 is included in the health benefits plan. In the absence o'f a collective bargaining agreement or employer/employee contract, the employer's contribution to the HMO is based on the cost to the employer of benefits provided under the non-HMO alternatives, excluding costs which are attributable to benefits that the H~,IO does 'not offer and which the employ.er · ,,'-:~ I c,:,~';:;,:ue to provide to employees who jein the ItI:O. If the er. player's contributions for non-HIiO health .benefits are prospectively rated, that prospective payment is the basis for determining the employer's obligation for Iii40 contributions. If the employer's non-HMO contributions' are retrospectively rated, tim employer's Iii. Ia contribution must be based on the projected net cost for the non-liMO program. The regulations spe.ctfy in detail how that projection shall be computed. If you h,ave any questions regarding this information, please contact Galbraith & Green, Inc.