Tag Archives: Hawaii Employer-Union Health Benefits Trust Fund

Majority of EUTF’s preferred provider plan participants opt to shift back to HMSA

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At last week’s meeting of the Hawaii Employer-Union Health Benefits Trust Fund, it was publicly announced that approximately 21,000 members submitted forms to move to the PPO health plan administered by HMSA instead of staying with the “default” HMA plan.

If that’s still true when all the smoke clears, it will mean HMSA held on to nearly 2/3 of its plan participants despite the EUTF decision that initially “defaulted” all HMSA members over to HMA.

It’s a better outcome for HMSA than the earlier shakeout at the Hawaii State Teachers Association, where at least 2/3 of teachers remained in a new HMA-administered plan.

But it’s an even bigger boost for HMA, which went from about 700 EUTF members to something around 12,000.

Both companies say they are looking forward to the competition.

When I was at the State Capitol yesterday to pick up paperwork to be filed in order to work as a session staffer during the upcoming session, the House Accounting Office was fielding questions about the EUTF health insurance plans. Turns out there is still a tremendous amount of confusion and anxiety about the EUTF offerings among the hundreds of people being hired to staff the 2010 legislative session.

Then there’s EUTF administrator Jim Williams, who is stepping down at the end of the year and moving to HSTA, where he has reportedly accepted a 3-month contract as executive director effective January 1, 2010, according to a Facebook post by Big Island teacher Paul Daugherty.

Daugherty also reports that HSTA interim executive director Dwight Takeno, who has also been serving as the teachers’ union chief negotiator, is leaving to take a human resources position at the University of Hawaii.

I met Takeno a decade ago when he was the young assistant to UPW state director Gary Rodrigues. This was during the period before Rodrigues was indicted and while the UPW and it’s parent union, AFSCME, were attempting to sidestep or dismiss allegations about misconduct by the union leader. I hope Takeno learned the right lessons from that experience.

EUTF eligibility verification process puts elderly dependents at risk

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With just two weeks left for state and county workers and retirees to verify that their dependents, if any, are eligible to continue to receive health insurance provided by the State Employer-Union Health Benefits Trust Fund, there are more signs that the verification process is flawed.

Elderly retirees, in particular, may face serious issues, especially if they are unable to cope with the confusing process and demand for documentation.

Take the case of my parents. My mother will be 96 in May 2010, and my dad turned 96 early this month. She is a retiree still living at home and still handling most of her own affairs, while my dad is in a nursing home suffering from Alzheimer’s.

Luckily, my mom spoke up before the verification deadline and said she was confused about the EUTF process.

A series of mailings from EUTF and plan administrators about changing health plan choices explained that they did not apply to retirees. Then came the dependent verification mailing. It was hard to sort them all out.

The verification audit sat in her mail for a while, until she finally asked: “Do I have to do anything?”

Actually, I hadn’t paid attention to whether this applied to retirees. I said I would look.

That turned out to be easier said than done.

Despite the fact that failure to complete the process by December 31 will result in loss of health insurance coverage for dependents, there isn’t a single mention of it on the EUTF web site. Search for “dependents” on the web site and you won’t find a thing.

With more extensive digging, I finally found a link where further information was supposed to be available (FYI, it was a link that I can’t recreate now). But even access to information required an employee number, which was on the mailing sent to my mother but that I didn’t have. So I couldn’t check on it for her.

Luckily, my sister, Bonnie, was able to intervene and move the process along.

According to the instructions, my mother has choices.

She can submit her 2008 joint tax return filed as husband/wife. Except that she can’t find where she put last year’s taxes.

She has the choice of submitting a copy of her marriage license and a real property tax bill showing joint ownership. Seriously. Do you know where your marriage license is? And can your mother find her last tax bill?

I doubt that my mother would have completed the the verification audit without substantial assistance. What about others who don’t have family nearby to intervene? What about those who don’t ask for help because they don’t understand what is at stake or find the whole process too confusing?

I think a lot of retirees are going to have these problems. Things get lost in the clutter. Required documentation may be hard to find or nonexistent. Deadlines are difficult to keep in mind. I would guess that a significant number of elders may just give up and hope for the best. Others may be legally eligible but incapable of responding. There appear to be no follow-up procedures before unverified dependents are retroactively cut off from their health insurance coverage.

Prediction: There are going to be many painful stories in a couple of months when retirees find their loved ones denied medical care because EUTF has dropped dependents from the eligible list. The lawsuits probably come later when the bills accumulate. More bad press is not what EUTF needs.

EUTF to consider penalizing HMSA for “unauthorized and inaccurate information”

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Trustees of the Hawaii Employer-Union Health Benefits Trust Fund are expected to vote today in a closed executive session on whether to penalized the state’s largest health insurer for what EUTF has called “unauthorized and inaccurate information” distributed in advertisements and mailings during November’s “open enrollment” period.

The action stems from a widely circulated email and Hawaii Medical Service Association ads warning its 33,000 EUTF members that they will be automatically transferred to a plan administered by HMA Inc., an affiliate of Summerlin Life & Health Insurance Company, unless they apply for a new lower cost plan administered by HMSA.

The EUTF contract requires prior approval of any communications sent directly by health insurers and plan administrators regarding the open enrollment choices and procedures, which HMSA did not request or receive.

It is the latest round in a lingering controversy over EUTF’s decision to discontinue the existing side-by-side HMA and HMSA-administered plans, and to designate the HMA-administered plan as the “default” for all public employees, rather than a new plan administered by the larger and far better known HMSA.

Currently, both HMSA and HMA administer PPO 90-10 health plans, in which employees pay 10% of most costs while the insurance plan covers 90%. Fewer than 1,000 employees are in the existing HMA-administered plan, while more than 33,000 are in the HMSA plan.

But as of February 1, 2010, employees in the PPO plan who did not apply for a new HMSA 80-20 plan will be assigned to the 90-10 HMA-administered plan. [Note: A previous version of this post incorrectly reported the start date of the new plans as January 1, a deadline which has been delayed a month.]

HMSA officials have said that they did not expect HMA to be designated as the default at the time they chose to administer the 80-20 plan. A request by HMSA to administer both their existing 90-10 plan and their new 80-20 plan was rejected by EUTF trustees in September.

EUTF has demanded that HMSA stop references to an “HMSA plan” because the plan is self-funded by EUTF and is not an HMSA insurance plan. Instead, both HMSA and HMA are hired only as third-party administrators of the plan defined and self-insured by EUTF.

HMSA’s competition has increased the pressure on EUTF by calling for strong action.

In a November 30 letter to EUTF chairman George Kahoohanohano, HMA General Manager Harris Nakamoto called on the trustees to “take serious action” in response to HMSA and impose penalties that will “send a message” to all vendors.

HMA requests that the Board of Trustees take serious action on MHSA’s attitude, conduct and disregard of the established rules during this open enrollment period. They did not follow the necessary approval processes communicated to all EUTF vendors in some of their emails, ads and external communications. Jim Williams’ demand letter to HMSA on November 4, 2009 was a strong message. However, we have yet to receive corrective actions to be taken by HMSA. We believe no vendor has any right or privilege to be above the established rules and regulations set forth by the EUTF and its Board of Trustees. What penalties will be EUTF Board serve HMSA during the next board meeting? This will set the tone for all vendors, and send a strong message in the next open enrollment sessions.

Minutes silent on whether EUTF trustees were told of Summerlin’s mainland troubles before approving “default” health plan

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At the same time that Summerlin Life and Health Insurance Company, a small Nevada-based insurer, announced its 2004 entry into Hawaii’s tight insurance market, the company was struggling to provide acceptable levels of service in its home state, where it was contracted to offer an HMO plan for Medicaid recipients as well as selling coverage to private companies.

Five years later, the company has fallen far short of it’s goals to grow the business in Hawaii and, under pressure, has pulled out of Iowa and Nevada, states once pointed to as evidence of its business prowess.

But, in a controversial move, the plan administered by Summerlin and an affiliate, HMA Inc., was recently made the “default” PPO plan offered to state and county employees by the Hawaii Employer-Union Health Benefits Trust Fund for 2010.

Minutes of the Hawaii Employer-Union Health Benefits Trust Fund give no indication that trustees were aware of any of the company’s problems on the mainland at the time they voted to approve the new and expanded contract with Summerlin and an affiliated company, HMA Inc.

In Nevada, Summerlin’s parent, IMX Companies, operated as Nevadacare, the same business name used by the firm’s former insurance operations in Iowa and touted as an example of the company’s successful business when it set up shop in Hawaii.

However, a 2005-2006 external quality review done for the State of Nevada found NevadaCare’s services to be average, at best, and failing in some categories.

A summary of quality ratings shows Nevadacare (NVC) receiving a grade of “F” in areas measured by the Consumer Assessment of Healthcare Providers and Systems (CAHPS) survey, and an average performance grade of “D”, although year-to-year improvements lifted it to an overall “C” average.

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According to the report, Nevadacare scored between the 10th and 25th percentile when compared to other firms nationally, meaning that between 75-90 percent performed better than Nevadacare.

In December 2006, the Las Vegas Sun reported Nevadacare owed the area’s public hospital $2.5-$2.8 million, described as the hospital’s “largest unpaid bill ever for an insurer”. The amounts overdue dated back to 2004 and 2005.

According to the story, University Medical Center had cut off Nevadacare in February 2006, citing the problems with payments. Nevadacare’s Medicaid contract was taken over by Anthem Blue Cross and Blue Shield on November 1, 2006.

Silver said NevadaCare owes UMC additional money from 2006, but she couldn’t estimate the amount. She said the volume of unpaid bills, and the hassles of trying to get them paid, are unprecedented.

“I don’t recall ever having to settle with anyone on these types of issues,” Silver said. “What’s different here is that either by design or by default they have had difficulty paying claims.”

NevadaCare is also being sued for unpaid bills by Nevada Cancer Center and Anesthesiology Consultants Inc. They say the insurer owes them more than $40,000 and $50,000, respectively. UMC officials say they hope to avoid arbitration with NevadaCare or filing a lawsuit.

In May 2007, KLAS-TV reported reported that amounts owed to the hospital by Nevadacare had grown to nearly $8 million.

The story referred to Nevadacare as “the worst offender” among area HMOs.

Nevadacare disputed this account, but by 2007 was no longer part of the Nevada Medicaid contract, and dropped its private insurance business in the state at the end of 2008.

The company agreed to withdraw from doing business in Iowa in order to settle charges brought by that state’s insurance commissioner.