The Medical Trust Plan Types
All the Medical Trust plans provide care through a network of doctors, dentists, hospitals, pharmacies, laboratories, and other providers. However, the different types of plans offer a range of options regarding the availability and cost of care in and out of network. The plan descriptions below can help you understand the features for each plan type.
We offer the following types of medical plans:1
- Exclusive Provider Organization (EPO) Plan
- Preferred Provider Organization (PPO) Plan
- Consumer-Directed Health Plan/Health Savings Account (CDHP/HSA)
- Medicare Secondary Payer Small Employer Exception (SEE) Plan
All of our plans include preventive care, prescription coverage, as well as vision and hearing benefits.
Members enrolled in a Kaiser EPO Plan agree to use only the plan’s network of professionals and facilities, and they are responsible for ensuring that the services and care they receive are covered by the plan. Kaiser EPOs do not cover the cost of services received from out-of-network providers, except in emergency situations.
As the Kaiser plans are built on a managed-care platform, members are required to select a Primary Care Physician (PCP), and, depending on your service area, may need a referral to see a specialist.
PPO members can receive services from any provider — inside or outside of the plan’s network — without coordinating their care through a primary care physician. However, the plan pays greater benefits for care received from a network provider or facility. PPO members are responsible for ensuring that the services and care they receive are covered by the plan. They are often responsible for submitting their own claims for out-of-network care.
A CDHP/HSA member’s coverage consists of two parts:
- A traditional health plan that promotes preventive care and protects members against catastrophic healthcare expenses (Consumer-Directed Health Plan) and
- A tax-advantaged savings/reimbursement account (Health Savings Account) that allows members to take control of their day-to-day healthcare costs.2
With the exception of certain types of preventive care, the benefits from a Consumer-Directed Health Plan begin after the member meets the annual deductible.3 Contributions to a Health Savings Account help members build savings for current and future medical expenses that fall within the deductible of the health plan. A list of qualified medical expenses that may be paid with funds held in the HSAs can be found at the IRS website.
How the CDHP works
The Consumer-Directed Health Plan works much like a PPO. Members can receive services from any provider, and they do not have to coordinate their care through a PCP. While the CDHP covers services in and out-of-network (like the PPO), the CDHP provides very strong financial incentives for members to use network providers.4 Under these plans, certain preventive care services are not subject to the deductible and require no cost share if provided by network providers.
How the HSA works
The Health Savings Account is funded by the employee and/or employer, with a “tax-favored” status. Members can open an HSA only if they are enrolled in a qualified High Deductible Health Plan. When they incur medical expenses, they can choose to pay with either HSA funds or out-of-pocket. If HSA funds are not used, the balance continues to grow with tax-free earnings and is available for future medical expenses.
Funds deposited in an HSA belong to the member until they are spent. Unused dollars may earn interest tax-free, with certain restrictions. If members change employers or retire, they can take their HSA with them. Withdrawals from an HSA are tax-free, as long as they are used to pay for qualified medical expenses. Distributions from an HSA that are not used for qualified medical expenses will be assessed a penalty of 20 percent. For tax reporting, it is important for members to retain records of these expenses.
Health Savings Accounts and High Deductible Health Plans
The Medical Trust provides the option for eligible employers to apply for the Medicare Secondary Payer (MSP) Small Employer Exception (SEE). If an employer applies for and is approved for the plan, eligible employees and their spouses can choose to participate in the SEE Plan.
In most cases, Medicare is the secondary payer of healthcare claims for active employees covered under Medicare Part A, and the Medical Trust plan is the first, or primary, payer. Medicare allows for an exception to the secondary payer rule for small employers called the Small Employer Exception (SEE). Participation in SEE is voluntary for eligible employers and their employees. It is anticipated that out-of-pocket costs will be lower for plan participants and that employers will save significantly in the cost of health benefits.
These plans are noted with MSP in the plan name.
Qualifying for SEE
In order to be eligible to participate, employees and/or spouses must be:
- 65 years or older
- Enrolled in Medicare Part A
- Enrolled in a Medical Trust SEE plan
- Work for an employer with fewer than 20 employees. (The exception must be applied for and approved before the SEE Plan can be implemented.)
What costs are covered?
Under the exception, Medicare will become the primary payer of claims covered under Medicare Part A. These include hospitalization expenses, including inpatient care in hospitals, skilled nursing facilities, hospices, and home healthcare settings. The Medical Trust plan will be the secondary payer. For other coverage, such as doctor visits, outpatient procedures and prescription drug coverage, the Medical Trust plan will be the primary payer. However, if an employee or eligible spouse elects to enroll in Medicare Part B coverage, Medicare will become the primary payer of Part B claims and the Medical Trust plan will be the secondary payer.
Medicare Secondary Payer Small Employer Exception (MSP SEE)
1Every group does not offer every plan. Please check with your group administrator for the plans available to you. Some fully insured plans offered on a regional basis (Hawaii Medical Service Association and Kaiser Permanente Washington) provide an HMO option.
2In general, members and/or their spouses are not eligible for the CDHP/HSA option if they have any other health coverage that would apply to services covered by the CDHP/HSA, such as coverage through a spouse's employer. Participation in a flexible spending account (FSA) may also limit a member’s ability to obtain coverage under the CDHP/HSA option.
3The CDHP deductible is a combination of medical and pharmacy deductible requirements. Therefore, to begin receiving benefits from the CDHP medical and prescription drug plans, members must meet one combined deductible.
4 The Kaiser CDHP-20/HSA is built on a managed care platform, and therefore requires the selection of a Primary Care Physician, requires a referral to see a specialist, and does not have out-of-network benefits.