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Health Care Reform and Your UT Benefits

It has been hard to miss the wide variety of media coverage about the recent passage of the federal Patient Protection and Affordable Care Act (PPACA). If you’re like most people, you have probably not had time to research the full details of the legislation and you may have a lot of questions about how this complex legislation will affect health benefits available to you and your family. As noted in the May edition of your “A Matter of Health Newsletter,” the PPACA along with a subsequent reconciliation measure were signed into law in late March. The resulting final legislation is sometimes referred to in general as “Health Care Reform.” Among its provisions, Health Care Reform includes a number of specific requirements designed to ensure that more people can get affordable health insurance that meets or exceeds certain minimum standards for benefits and cost-sharing limits.

Because of the large number of variables involved in trying to meet Health Care Reform goals, the final legislation is extremely complex and has significant implications both for private insurers and for employers, such as UT System, that offer health care coverage to employees and their families. Health care and legal experts throughout the country have been reviewing the law and have identified many areas that require additional information due to limited detail included within the legislation itself. The Department of Health and Human Services, the Internal Revenue Service, and the Department of Labor are expected to issue detailed guidance on many provisions along with specific regulations over the coming months.

While waiting for additional guidance, the UT System Office of Employee Benefits (OEB), in consultation with outside health care experts and legal counsel, continues to examine both the short and long-term requirements of the new law and to analyze how required changes will impact the overall UT Benefits program. Although many details remain to be seen, there is some information that can be shared now with regard to UT Benefits. You should to continue to pay close attention to information provided about your UT Benefits over the coming months in order to keep up with changes expected over the next plan year and in the years to come.

Most provisions of Health Care Reform do not immediately impact your UT Benefits. The first provision of the new law to directly impact UT Benefits will become effective on January 1, 2011 (see chart below for details). However, most provisions have a later effective date, in particular because UT SELECT is a “grandfathered” plan which was already in existence at the time the legislation was passed and many items are delayed for grandfathered plans in order to minimize disruption for plan participants.

A few limited changes are expected during upcoming plan years. The following chart details the main Health Care Reform Requirements that will impact UT Benefits plans over the next few years based on current information. Further guidance and newly issued regulations may result in additional changes. If this happens, additional information will be communicated to all plan participants as soon as it becomes available.

Expected Effective Date

Affected Plan
Specific Change

January 1, 2011

UT FLEX Medical Expense Reimbursement Account

Elimination of qualifying expense status for over-the-counter (OTC) medications unless purchased with a prescription (except OTC insulin)

September 1, 2011

UT SELECT Medical Plan

Coverage for young adult dependents until the age of 26

September 1, 2012

UT FLEX Medical Expense Reimbursement Account

Maximum limit for annual contributions capped at $2500 (down from existing UT System limit of $5000)

September 1, 2014

UT SELECT Medical Plan

Reduction of state mandated waiting period from potential up to 120 days to a maximum of 90 days

Prevention and wellness will continue to be important. Because prevention and wellness have been priorities for UT Benefits and are also key areas of focus within the legislation, a number of preventive services will continue to be available with little or no out-of-pocket costs. UT SELECT already includes a number of preventive services with no cost-sharing required, including: office visit related and outpatient lab work and x-rays; mammograms; and preventive colonoscopies. Others may be added based on future requirements. Additionally, increased incentives for participation in prevention and wellness activities have been authorized and may be offered through the UT System Living Well: Make it a Priority program.

Some annual limits on specific benefits may be reduced or eliminated. UT SELECT has always offered robust coverage, regardless of any pre-existing health issues, with only a small subset of medical services subject to annual or lifetime limits. Health Care Reform includes provisions requiring the elimination of annual and lifetime limits on certain essential services, which must still be fully defined. Depending on the final regulations, some additional services may be available through UT SELECT without annual or lifetime limits.

Your UT Benefits team is working to ensure that all requirements are met and that you have up to date information about any changes being made to the UT Benefits program. Although we are aware of differing opinions regarding the Health Care Reform measures that were passed, it is the job of the OEB Benefits team (with support from the HR and Benefits staff at your specific UT Institution) to ensure that your benefits are administered in full compliance with all applicable laws and regulations. In addition to making any required changes, OEB will be continually working to provide clear, comprehensive, and up-to-date information to all plan participants on a regular basis.

It is easy to feel overwhelmed with the variety of information and continuing questions regarding Health Care Reform and with overall costs for health care services still currently rising. During the coming years as OEB continues to analyze and implement changes required by Health Care Reform legislation and to provide up-to-date information about UT Benefits changes, you should continue to remain actively involved in managing your own health and wellness in order to be sure that you are utilizing your benefits wisely and that you are getting the most value from your UT Benefits. If you haven’t done so this plan year, now is a great time to schedule your annual physical and to make sure that you and your family are getting all of the preventive care exams that you may need. And be sure to visit the UT System Living Well: Make it a Priority program website to learn about other ideas for improving your health and wellness that can help you get the most value from your benefits today.

 

Contact Us

If you would like a specific topic discussed or have a question you would like answered in a future issue of this newsletter, please send your suggestions to benefits@utsystem.edu.

UT System Employee Benefits Web site: www.utsystem.edu/benefits/
UT System Retirement Programs Web site: www.utretirement.utsystem.edu
Your Local Benefits Office: www.utsystem.edu/benefits/contacts/#1