2015 Benefits Bulletin Retiree Medical Benefits

Benefits Bulletin
October 2014
2015
Inside This Bulletin
2 Your Retiree Medical
Options in 2015
3 Plan Options Being
Discontinued
4 Pre-Medicare Options
5 Medicare Options
6 Premium Plan —
New for 2015!
12Turning Age 65
Retiree Medical Benefits
For the 2015 benefit plan year, we are introducing
a new plan option, the Premium Plan, and
discontinuing some of the current plan options.
This bulletin summarizes these changes to the
Northrop Grumman Retiree Medical Plan and
provides an overview of the medical plan options
available to retirees beginning January 1.
Annual Enrollment for your retiree medical
benefits will run from October 27 through
November 14, 2014. Look for your Annual
Enrollment Worksheet, which lists your specific
plan options and associated costs, in the mail
a few days before Annual Enrollment begins.
14For More
Information
Annual Enrollment is coming soon:
October 27–November 14
1
Your Retiree Medical Options in 2015
Your retiree medical options will vary depending on your Medicare status and where you live.
Pre-Medicare
Following are the plan options available to
retirees and their dependents who are not
eligible for Medicare.
Pre-Medicare Options
• Premium Plan — New for 2015!
• HMOs (vary by state or ZIP code)
—EmblemHealth
—Kaiser Permanente
• TRICARE Supplement
• Aetna International Benefits Plan
Medicare-Eligible and Age 65
and Over
Beginning August 1, 2014, retirees and their
dependents age 65 and older are not eligible
for medical and prescription drug coverage
under the Northrop Grumman Retiree Medical
Plan. See page 12 for details.
Medicare-Eligible and Under Age 65
For retirees and dependents under age 65
who are Medicare eligible due to a disability,
the following options are available.
Medicare Eligible and Under Age 65 Options*
• Premium Plan — New for 2015!
• Medigap-type option
• Prescription Drug Program
• Medicare Supplement and Medicare
Advantage HMOs (vary by state or ZIP code)
—EmblemHealth
—Kaiser Permanente
* If you are under age 65 and eligible for Medicare due
to end stage renal disease (ESRD), please call the
Northrop Grumman Benefits Center to review your
plan options.
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Benefits OnLine: http://benefits.northropgrumman.com • NGBC: 1-800-894-4194
Plan Options Being Discontinued
Northrop Grumman is updating the retiree medical plan options to bring them more in line with
the options available to our active employees. As a result, many of the current retiree medical
plan options will be discontinued for 2015, including the Preferred Provider Organization (PPO),
the Consumer Driven Health Plan (CDHP), and the Pre-Medicare Standalone Prescription Drug
Program. In addition, because of low participation and declining enrollment, several HMOs have
not been renewed and will no longer be available as plan options in 2015.
The chart below shows the plan options being discontinued and the coverage in which you
will be automatically enrolled, unless you make a different election during Annual Enrollment.
If your current option is not listed (e.g., Kaiser or the Medigap-type option), you will continue to
participate in that plan as long as you are eligible.
If you are currently enrolled in…
You will be automatically enrolled in…
PPO
Premium Plan
CDHP (pre-Medicare)
Premium Plan
Standalone Prescription Drug Program
(pre-Medicare)
No coverage*
EmblemHealth Low Copay HMO (pre-Medicare)
EmblemHealth High Copay HMO (pre-Medicare)
Health Plan Nevada HMO (pre-Medicare)
Premium Plan
CDHP (Medicare)
Premium Plan (Medicare)**
Health Plan Nevada Senior Dimensions
Medicare Advantage HMO
Medigap-type option and Prescription
Drug Program**
Health Net Plus Medicare Advantage HMO
Medigap-type option and Prescription
Drug Program**
UnitedHealthcare of Arizona, California or
Colorado Medicare Advantage HMO
Medigap-type option and Prescription
Drug Program**
* Prescription drug coverage is no longer available for pre-Medicare retirees as a stand-alone option. For both medical
and prescription drug coverage, you should enroll in the Premium Plan (or an HMO if available in your location).
** These options are available only to those under age 65 who are eligible for Medicare due to a disability.
Your Annual Enrollment Worksheet will list the specific options available to you and the “default”
coverage you will receive if you do not select a different plan option during Annual Enrollment.
3
Pre-Medicare Options
The following medical options are available to retirees and their dependents under age 65 and
not eligible for Medicare. Each option includes medical and prescription drug coverage.
Premium Plan
The Premium Plan is a consumer-driven health plan. You must
meet a deductible before the Premium Plan begins covering your
medical and prescription drug expenses. The plan includes a Health
Reimbursement Account (HRA), funded by Northrop Grumman, that
you use to meet part of the deductible. See page 6 for details on this
new plan option.
Health
Maintenance
Organization
(HMO)
EmblemHealth and Kaiser Permanente HMOs are offered in a few
locations. If you enroll in an HMO, you must visit providers in the
HMO network or you will not receive benefit coverage (except in an
emergency). If you enroll in an HMO, the HMO carrier should notify you
directly about plan updates.
TRICARE
Supplement
TRICARE is a health care program for uniformed service members,
retirees and their families. The TRICARE Supplement is available
through ASI Corporation, an insurance carrier, and is not part of the
Northrop Grumman Retiree Medical Plan. Northrop Grumman will
collect your premiums for this coverage and forward them to ASI
Corporation on your behalf. If you choose to purchase the ASI TRICARE
Supplement, you pay the full cost of coverage — Northrop Grumman is
not permitted to pay any part of the cost of coverage.
Aetna International
Benefits Plan
The Northrop Grumman Retiree Medical Plan offers the Aetna
International Benefits Plan for our retirees living overseas. There are
no changes to this plan option for 2015.
More information about these plan options, including detailed plan summaries, is available at
Benefits OnLine at http://benefits.northropgrumman.com under the Retiree Connection tab.
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Benefits OnLine: http://benefits.northropgrumman.com • NGBC: 1-800-894-4194
Medicare Options
Age 65 and Over
If you are age 65 or older, you are not eligible for medical or prescription drug coverage under the
Northrop Grumman Retiree Medical Plan. See page 12 for details.
Under Age 65 and Eligible for Medicare
The following medical options are available to participants under age 65 who are eligible for
Medicare due to a disability. To participate in one of these options, you must be enrolled in
Medicare Parts A and B.
Premium Plan
The Premium Plan is a new option available for 2015. This plan
includes both medical and prescription drug coverage and is available
to all retirees (and dependents) under age 65, including those eligible
for Medicare due to a disability. See page 6 for details on this new
plan option and page 10 for additional details about how the plan
coordinates with Medicare.
Medigap-type
Option
The Medigap-type option helps pay some medical costs that
aren’t covered by Medicare (e.g., deductibles for hospitalization
and coinsurance for doctors’ services). There are no changes to
the Medigap-type option for 2015. This option does not include
prescription drug coverage. If you want prescription drug coverage
in addition to the Medigap-type coverage, you must enroll separately
in the Prescription Drug Program.
Standalone
Prescription
Drug Program for
Medicare-Eligible
Retirees
The Standalone Prescription Drug Program currently being offered to
Medicare-eligible retirees will continue to be available in 2015 for those
individuals under age 65 who are eligible for Medicare. The Prescription
Drug Program provides comprehensive prescription drug coverage and
is administered by CVS Caremark. There are no changes to the benefits
provided under this plan option.
Medicare
Supplement
and Medicare
Advantage HMOs
EmblemHealth and Kaiser Permanente Medicare Supplement and
Medicare Advantage HMOs are offered in a few states. These plans
typically offer benefits in addition to Medicare Parts A and B, such
as prescription drug coverage. If you choose to enroll in a Medicare
Advantage HMO in which you are not currently enrolled, you must
assign your Medicare coverage to the new plan by submitting a
Medicare enrollment form to the carrier for approval.
5
Premium Plan — New for 2015!
Premium Plan Terms You Need to Know
• Deductible: The deductible is the
amount you pay for health care services
before the plan begins to pay. The same
deductible applies to both medical and
prescription drug expenses.
• Health Reimbursement Account (HRA):
Northrop Grumman allocates funds to
your HRA each year. HRA funds pay for
covered services such as doctor visits
and prescription drugs, and help satisfy
all or part of your deductible. HRA funds
are used first and automatically. You do
not need to do anything for the HRA funds
to be utilized. If your deductible is greater
than your HRA balance, the remaining
deductible is your responsibility. Unused
HRA funds roll over to the next year.
Note: If you are currently enrolled in the
CDHP option, any HRA balance you have
at the end of the plan year will transfer to
your new HRA in the Premium Plan.
• Coinsurance: Once your combined
medical and prescription drug expenses
exceed the annual deductible, the plan
pays 80% (you pay 20%) of in-network
covered services (50% of maximum
allowed amounts for out-of-network
covered expenses) for the remainder of
the year — until you reach the out-ofpocket maximum.
• Out-of-pocket Maximum: Once you
reach the out-of-pocket maximum, the
plan pays 100% for all covered services
for the remainder of the year.
6
How the Premium Plan Works
The Premium Plan is a consumer-driven
health plan that provides both medical and
prescription drug coverage. Although you
may visit any licensed provider, your out-ofpocket costs will be significantly higher if
you use out-of-network providers.
Following are some highlights of the
Premium Plan.
• Anthem administers medical benefits
for the Premium Plan and the network of
participating doctors is the same Anthem
network used in the existing PPO and
CDHP plans.
• CVS Caremark administers the prescription
drug benefit, which offers savings with
generics and in-network pharmacies.
• There are no copays in the Premium
Plan for medical expenses, office visits,
or prescription drugs. Instead, these
expenses, except preventive care, are
subject to the deductible and coinsurance.
• The deductible and out-of-pocket
maximum amounts include medical and
prescription drugs. In other words, you do
not have to meet separate deductibles or
out-of-pocket maximums for medical and
prescription drug expenses.
• Preventive care is covered at 100% if you
use an in-network provider.
If you are Medicare-eligible, the Premium
Plan works a bit differently than described
here. See page 10 for more information.
Benefits OnLine: http://benefits.northropgrumman.com • NGBC: 1-800-894-4194
Details by Coverage Level
Premium Plan Details
Retiree
Only
Retiree + Spouse/
Domestic Partner
Retiree +
Child(ren)
Retiree +
Family
Total Deductible
$1,650
$2,475
$2,475
$3,300
Health Reimbursement
Account (HRA) funded by
Northrop Grumman per year
$400
$600
$600
$800
Net deductible* (after HRA)
Participant pays 100%
$1,250
$1,875
$1,875
$2,500
Coinsurance
80%/20% coinsurance for providers who participate in the
Anthem and CVS Caremark networks — plan pays 80%, you
pay 20%
50% of maximum allowed amount for providers who do not
participate in the Anthem and CVS Caremark networks
Out-of-pocket maximum*
(deductible + coinsurance)
$5,000
$7,500
$7,500
$10,000
* The company-funded HRA effectively reduces the total deductible as shown above, as well as the out-of-pocket
maximum.
Important: If you use an out-of-network provider, the Premium Plan pays 50% of the maximum
allowed amount. You are responsible for the remaining 50% plus any excess amount billed by
the provider.
7
Paying For Care
Step 1: Deductible
Step 2: Coinsurance
You pay the full cost of all covered medical
services and prescription drugs until you meet
the annual deductible. Here is how the plan
works to help you meet the deductible.
Once you meet the annual deductible for your
coverage level (see “Details by Coverage Level”
on page 7), the plan shares a percentage of
the cost of eligible expenses with you. The
plan covers the majority of the cost of covered
services (80% in-network; 50% of maximum
allowed amount out-of-network). There are
no copays in the Premium Plan — your doctor
office visits and prescription drug costs are
treated as any other medical expense.
• Northrop Grumman funds your HRA to help
you pay for eligible medical and prescription
drug expenses. When you have eligible
expenses, HRA funds are used first and
automatically. Eligible expenses paid with
your HRA count toward your deductible and
out-of-pocket maximum.
• Expenses for all covered family members
are combined to meet the deductible and
out-of-pocket maximum.
• Preventive care is covered at 100% if you use
an in-network provider, even if you haven’t met
the deductible. Not only does this give you
the opportunity to identify and treat health
problems before they become more serious,
it also helps you avoid high medical expenses.
Step 3: Out-of-Pocket Maximum
Cost sharing continues until you meet the
annual out-of-pocket maximum. This amount
limits your out-of-pocket spending. Once you
reach this maximum, the plan pays the full cost
of eligible medical services until the end of the
plan year.
Using Out-of-Network Providers
You may use any licensed health care provider; however, your out-of-pocket costs will be
significantly higher if you use an out-of-network provider.
• If you use an out-of-network medical provider, the Premium Plan pays 50% of the maximum
amount allowed by Anthem for the service. You are responsible for the remaining 50% plus
any amount the provider may bill you in excess of the maximum allowed amount. This excess
amount is not applied to the deductible or out-of-pocket maximum. To find an in-network
provider, go to www.anthem.com/ca, log in, then select Find a Doctor.
Note: While the Premium Plan is not a PPO, it uses Anthem’s PPO network.
• If you use an out-of-network pharmacy, you pay 50% of the cost of the prescription drug.
To find a CVS Caremark network pharmacy, go to www.caremark.com.
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Benefits OnLine: http://benefits.northropgrumman.com • NGBC: 1-800-894-4194
Premium Plan Example
Pre-Medicare Participant with Retiree + Spouse Coverage
Let’s assume you have retiree plus spouse coverage and you and your spouse use only
in-network providers. Your deductible is $2,475 and you receive an HRA allocation of $600
to use toward the deductible. Here are examples of how the plan will cover expenses.
Plan/HRA pays
You pay
You incur $200 in covered expenses: a doctor visit at $80 and prescription drugs at $120.
The HRA is used to pay your $80 doctor visit and
$120 prescription drug expense (total $200).
Your HRA balance is now $400.
$200
$0
This amount is
applied towards
the deductible.
Next, your spouse has an outpatient surgery, and the in-network covered expenses
come to $8,000.
The remaining $400 HRA balance is used.
$400
Not applicable
This leaves $7,600 in unpaid expenses from
the outpatient surgery.
This amount is also
applied towards
the deductible.
Of the $7,600, you pay $1,875 to satisfy the
remaining deductible ($2,475–$200–$400).
Not applicable
$1,875
Now that you have met the deductible, the plan
will cover the remaining $5,725 at 80%. The plan
pays 80% of $5,725 (or $4,580) and you pay the
remaining 20% or $1,145.
$4,580
$1,145
Total
$5,180
$3,020
This leaves $5,725 ($7,600–$1,875) in unpaid
covered expenses from the surgery.
In this example, your total out-of-pocket expense is the $1,875 paid toward the deductible plus
20% of $5,575, for a total of $3,020.
9
If You Are Medicare-eligible and
Under Age 65
If Medicare is your primary medical insurance,
the Premium Plan works a bit differently than
previously described. The Premium Plan
generally covers your prescription drug costs
and any other medically necessary expenses
not covered by Medicare.
HRA Allocation
The Premium Plan will apply your HRA dollars
towards your prescription drug costs and
medical out-of-pocket expenses that Medicare
does not cover such as:
• Medicare Part A & B deductibles
• Medicare Part B coinsurance
• Medically necessary services outside of
what Medicare covers, such as acupuncture.
Coinsurance
Once you have met the deductible, the Premium
Plan will begin its traditional coordination with
Medicare, providing full coverage when you
receive treatment from participating Medicare
providers. Your coinsurance share is 20% for
in-network providers and 50% of the maximum
allowed amount for out-of-network providers.
(As a result of the Premium Plan’s coordination
of benefits with Medicare, you may still be
responsible for the coinsurance after the claim
is processed.)
For prescription drugs, you pay 20%
coinsurance when your prescriptions are filled
at an in-network pharmacy and 50% when your
prescriptions are filled at an out-of-network
pharmacy.
You continue to pay coinsurance until you
reach the out-of-pocket maximum.
Meeting the Premium Plan Deductible
Once your HRA dollars are spent for the year,
you are responsible for paying the remaining
deductible. The Premium Plan will continue
to coordinate with Medicare by crediting
amounts Medicare does not pay towards
satisfying the Premium Plan deductible. Your
prescription drug costs will also be applied to
the deductible.
10
Benefits OnLine: http://benefits.northropgrumman.com • NGBC: 1-800-894-4194
9
Prescription Drug Coverage in
the Premium Plan
The Premium Plan includes prescription drug
benefits administered by CVS Caremark, not
Anthem. Even though medical and prescription
drug benefits are administered by different
insurance carriers, the expenses you pay
for both are combined and applied to the
deductible and out-of-pocket maximum.
The CVS Caremark retail pharmacy network
includes most major pharmacies but
does not include Walgreens. For a full list
of network pharmacies, to confirm that a
particular pharmacy participates in the CVS
Caremark network, and to find the pharmacy
closest to you, call CVS Caremark directly at
1-855-361-8565 or go to the CVS Caremark
website at www.caremark.com.
Below are some prescription drug features
in the Premium Plan.
Mandatory Generics and Step
Therapy Programs
If a chemically equivalent and equally effective
generic drug is available, you are required
to try the lower-cost generic medication
before “stepping up” to a higher-cost brand
medication. This applies to any first time
prescription, prescriptions that have not been
filled for more than 130 days, and maintenance
prescriptions. Your pharmacist will give you the
generic drug, unless the prescription specifies
“Dispense as Written.”
If there is a medical reason you are unable to
use the generic drug, your doctor must contact
the Prior Authorization line at CVS Caremark.
Prior Authorization must be approved by CVS
Caremark before the prescription is filled, or
you will be required to pay the difference in
cost between the brand drug and generic drug.
Note: your HRA will not cover the difference
in cost, nor will the charge apply to your
deductible or out-of-pocket maximum.
CVS Caremark Maintenance Choice®
If you take a maintenance medication to
treat an ongoing medical condition, you are
required to fill your prescription at a CVS retail
pharmacy or through the CVS Caremark mail
service. For mail service assistance, contact
CVS Caremark Customer Care or log on to
www.caremark.com.
The Premium Plan limits the amount you
pay for your maintenance medication. Once
you meet the plan deductible, you pay 20%
coinsurance up to a maximum of $200 per
prescription for a 90-day supply. (If you take
a specialty medication, the $200 maximum
applies to a 30-day supply.) 11
Turning Age 65
What Happens to Your
Northrop Grumman Retiree
Medical Coverage When You
Turn Age 65
When you reach age 65, Medicare will become
your primary health insurance, and your
medical and prescription drug coverage under
the Northrop Grumman Retiree Medical Plan
will end. You will have the option to purchase
coverage that supplements Medicare through
Towers Watson’s OneExchange.
As of August 1, 2014, the Northrop Grumman
Retiree Medical Plan no longer offers group
Medicare supplemental insurance to its
retirees and their eligible dependents age
65 or older. Instead, Northrop Grumman has
partnered with Towers Watson’s OneExchange,
a private insurance exchange, to help our
retirees understand and enroll in Medicare
supplemental insurance plans.
12
Retiree Health Reimbursement Arrangement
If you are eligible for subsidized retiree
medical coverage based on your heritage
classification, you will receive subsidy support
in the form of a Retiree Health Reimbursement
Arrangement (RHRA). If you are eligible for an
RHRA, Northrop Grumman will fund your RHRA
with a fixed annual “credit” amount that you
can use to help pay for an individual Medicare
supplement plan of your choice. You can also
use your available RHRA dollars to pay your
Medicare Part B premiums and your out-ofpocket costs for eligible medical, prescription
drug, dental, and vision care expenses.
About one year before you or your eligible
dependent turn age 65, you will begin
receiving information about Towers Watson’s
OneExchange (and the RHRA if you are eligible).
Benefits OnLine: http://benefits.northropgrumman.com • NGBC: 1-800-894-4194
9
“Split Coverage Situations”
In some cases, the retiree may be age 65 or
older and the spouse is still under 65 or vice
versa. In these situations:
• The individual who is age 65 or older and
eligible for Medicare will not be eligible
for medical or prescription drug coverage
through the Northrop Grumman Retiree
Medical Plan but will have access to the
services offered through Towers Watson’s
OneExchange.
• The individual under age 65 may remain
enrolled in medical and prescription drug
coverage under the Northrop Grumman
Retiree Medical Plan up to age 65.
Important: If a retiree’s spouse remains
covered in the Northrop Grumman Retiree
Medical Plan, all correspondence about the
spouse’s coverage will still be addressed
to the retiree. For example, the Annual
Enrollment Worksheet will be addressed
to the retiree, but the coverage shown
will be for the spouse. Be sure to read all
correspondence from the Northrop Grumman
Benefits Center.
13
For More Information
How Can I Learn More?
Attend an information session to learn about what’s changing for the 2015 plan year.
Visit Retiree Connection at Benefits OnLine at http://benefits.northropgrumman.com for
a schedule of sessions and complete details about this year’s Retiree Annual Enrollment.
Look for your Annual Enrollment Worksheet in the mail a few days before annual enrollment
begins on October 27.
Contacts
For more information about Northrop Grumman retiree medical coverage, visit Retiree
Connection at Benefits OnLine at http://benefits.northropgrumman.com or contact the
Northrop Grumman Benefits Center at 1-800-894-4194 (overseas: 718-354-1339). You will
need your My Benefits Access password to secure your call. Benefits service representatives are
available from 9:00 a.m. to 6:00 p.m. Eastern Time, Monday through Friday (excluding holidays).
If you are hearing impaired, you will need to use a relay service through your TTY/TDD provider.
You may also contact the plan administrator for more information about specific plans.
14
Provider
Phone
Website
Anthem Blue Cross
1-800-894-1374
www.anthem.com/ca
Aetna International
1-888-506-2278 — toll free
1-813-775-0189 — collect
www.aetnainternational.com
CVS Caremark
1-855-361-8565
www.caremark.com
EmblemHealth
1-800-447-8632
www.emblemhealth.com
Kaiser Permanente
1-800-464-4000 (California)
1-301-468-6000 (Mid-Atlantic)
www.my.kp.org/northropgrumman
Benefits OnLine: http://benefits.northropgrumman.com • NGBC: 1-800-894-4194
9
Annual Enrollment:
October 27–November 14
Benefits OnLine:
http://benefits.northropgrumman.com
NGBC:
1-800-894-4194
15
This Bulletin contains information for participants in the Northrop Grumman Retiree Medical Plan. This Bulletin and the
content on the Benefits OnLine and My Benefits Access websites provide a summary of important information about
your participation in the Northrop Grumman Retiree Medical Plan. The Bulletin is not a summary plan description, but it
is a summary of material modifications that will generally be effective January 1, 2015 (the Bulletin also describes some
terms of the Plan that became effective August 1, 2014). Complete details about the Plan are contained in the legal plan
documents that govern plan operation and administration. If there is a discrepancy between the information provided
in this Bulletin or the websites and the provisions of the plan documents, the plan documents will govern. Northrop
Grumman reserves the right in its sole discretion to terminate, suspend, withdraw, amend or modify the Plan at any time
and for any reason.
PRE EX–1A
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Benefits OnLine: http://benefits.northropgrumman.com • NGBC: 1-800-894-4194