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Medical Insurance: this coverage can be designed from a
continuum of plans extending from very restrictive to completely
non-restrictive.
Health Maintenance Organization (HMO): An HMO is the
most restrictive, therefore least costly approach to providing
health insurance. Enrollees select a Primary Care Physician (PCP)
from whom all initial medical care is rendered. Specialty care is
obtained via a referral from the Primary Care Physician to one of
the specialist within the Managed Care Network. There are NO
benefits for expenses incurred from non-network physicians or
facilities. The in-network payment is in the form of an office
co-pay that may range between $5-$20.
Point of Service (POS): This coverage design is similar
to the HMO with optional benefits for expenses incurred
out-of-network. The enrollee will select a Primary Care Physician
and obtain referrals to the network specialist, and pay the
selected co-pay for the in-network service. Unlike the HMO, a POS
Plan will reimburse the out-of-network expenses that will be
subjected to an annual Deductible ($250, $500, $1000) and
Coinsurance (70%-80%) with a stop loss threshold limiting
out-of-pocket expenses to the selected deductible and coinsurance
limit.
Open Access POS: The Open Access POS Plan functions
similarly to a Point-of-Service plan in that participants are
required to select a primary care physician. However, employees
have direct access on a non-referred basis to all specialists
within the network.
Preferred Provider Organization (PPO): Although similar
in design to a POS, the PPO design provides both in-network
benefits at a selected co-pay, out-of-network benefits subjected
to deductibles and coinsurance but permits direct access without a
referral to any network provider.
Traditional Health Benefits: In the current managed care
environment, traditional medical plans with deductibles,
coinsurance and no supportive managed care network are rare except
for public sector employers. There are no networks, Primary Care
Physicians, or referrals required as benefits are adjusted in
accordance with Reasonable & Customary guidelines.
Dental Insurance: May be designed as a network based
program or an indemnity plan. The network format provides discounted
fees-for-service for those services performed by a participating
dentist, while the indemnity format provides Reasonable &
Customary reimbursements. Many plans provide for 100% reimbursement
of preventative services that include two cleanings per year. Basic
services are typically reimbursed at 80% and the more extensive
major services carry either a 50% or 60% reimbursement. Optional
orthodontic benefits may be included.
Life Insurance: This coverage provides benefits to named
beneficiaries. Designed as either a function of salary (100% or
200%), or a defined class basis in which all employees defined
within a class receive an equal benefit amount. The first $50,000 of
employer paid benefits are tax-free to the employee. The economic
value of excess (over $50,000) will carry some minimal 1099 exposure
as defined by the IRS.
Accidental Death & Dismemberment (AD&D): An
adjunct to the life insurance that will provide additional benefits
for death due to accidental means and lesser benefits for the loss
of limbs or speech.
Short Term Disability (STD): This provides income
replacement coverage for non-occupational related disabilities.
Programs in New Jersey must be equal to mandated TDB (STD provided
through the state) requirements that provide salary continuation for
up to 26 weeks. Non-statutory plans will provide for benefits of
50%-66 2/3% of salary to a specific limit for up to 26 weeks.
Long Term Disability (LTD): Income replacement coverage
that commences after exhausting any Short Term Disability benefits
that are in-force. Plans are designed to provide 50%-60%-66 2/3% of
pre-disability earnings subjected to a maximum monthly benefit for a
period extending to Social Security normal retirement date. Benefits
are offset by receipt of any Social Security Disability Awards and
may carry a tax burden representing the proportion of the premium
paid by the employer, and may be designed with various definitions
of disability.
Long Term Care Insurance: Designed to provide
reimbursement for the loss of two "Activities of Daily Living"
(bathing, dressing, feeding, mobility, transferring, continence or
loss of cognition). Benefits may be obtained for nursing home
expenses or for home expenses. Recent tax law changes have made this
coverage more acceptable. | 
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2008 • Grinspec Consulting