The Companion Product to Core Medical Benefits. A Group Supplemental Out-of-pocket Medical Expense Insurance Policy. Guide for Companion Gap Brokers

Transcription

1 The Companion Product to Core Medical Benefits A Group Supplemental Out-of-pocket Medical Expense Insurance Policy by Guide for Companion Gap Brokers

2 The Companion Product to Core Medical Benefits Table of Contents Welcome to Companion Gap Selling Companion Gap Understanding Companion Gap Overview / Product Description Policy Type Basic Product Features 1 3 Termination Policy Employer Plan(s) Employee Coverage Dependent(s) Coverage Premium Plan Summary Inpatient Benefits Outpatient Benefit Ambulance Benefit Physician Office Visit Exclusions 4 Coinsurance/ Co-Pay Conversion Rules Policy Limitations Pre-Existing Conditions Waiting Period for Late Entrants Group Guidelines Group Eligibility Renewals Insured Eligibility Plan Design Requirements Benefit Year Multiple Plans Buy-up Option Increase in Coverage 7 Policy Provisions COBRA Continuation of Coverage Extension of Benefits General Contact Information Policy & Certificate Case Administration Contact Information Claim Procedures Assignment of Benefits Manual Claims Process 10 Enrollment Period New Hires Late Entrants Effective Date 11

3 Welcome to Companion Gap Employers and employees have continually been pressured by escalating healthcare costs. Most experts agree that the Patient Protection and Affordable Care Act dealt with access to the healthcare system and ignored cost issues. As a result, healthcare cost increases have accelerated and will continue to do so for quite some time into the future. Companion Gap is designed to be a business solution to escalating healthcare costs for employers and cost shifting to employees. It enables employers to continue to purchase comprehensive health insurance by raising out-of-pocket expenses but offsetting the vast majority of those increases out-of-pocket expenses with the Companion Gap benefits. Companion Gap is administered by Key Benefit Administrators (KBA). KBA has developed a patent pending selling methodology called the Controlled Healthcare Budget (CHB). When you become CHB Certified, you will be professionally proficient in the artful use of Companion Gap as the CHB tool is used to accomplish the following four objectives: 1. Reduce the cost of the benefit program immediately. 2. Hold this cost level for multiple years. 3. Improve the benefits for 91% of the covered members. 4. Keep the other 9% well covered and grateful. You will be selling a solution when the above four objectives are met. Companion Gap is the center-piece tool creating the solution. Your General Agent will assist you in becoming certified in the use of the patent pending Controlled Healthcare Budget selling methodology. Take the time to become CHB Certified and enhance your prospecting, sales, professionalism, and success. Companion Gap is the perfect companion and complimentary product to the employer s underlying fully insured or self-funded major medical plan. Good luck and good selling! SELLING COMPANION GAP Supplemental medical insurance is often called gap coverage as it is used to help pay deductibles or co-payments and co-insurance from the insured s medical insurance. Today, these out-of-pocket amounts are often quite substantial and can impact a family s financial stability. The upcoming examples best illustrate the out-of-pocket differences for an insured who has a Companion Gap policy and one who does not. Supplemental medical expense plans represent a great opportunity for producers to bring innovative solutions to their clients. For the first time in many years, brokers, like yourself, have more than only premium increases and resulting premium comparisons to take to your clients. With Companion Gap you are able to sell more long-term solutions to rising healthcare costs and not just quote rates. Simply, you have a solution to sell. Producers can stay ahead of their competitors and demonstrate their ability to deliver high value to their clients by becoming familiar with the provisions, limitations, administration (submission/claims processes) and rating process of Companion Gap. Additionally, producers should understand the account s current medical plan and how supplemental medical expense insurance can complement the plan. Producers should also understand why people need supplemental medical insurance as well as develop sales approaches that fit the particular need of the employee group you are working with.

4 These examples give you a good idea of how valuable Companion Gap can be to both employers and employees. CLAIM EXAMPLES Inpatient Hospital Claim Example Let s look at an Inpatient Hospital claim example. Here, assume the hospital cost was $10,000 and the surgery $4,000 (totaling $14,000), and the insured s medical plan s deductible and co-insurance out-of-pocket are $2,000 and $2,400 respectively. Also assume that the employer selected the $3,500 Inpatient Hospital Companion Gap Benefit (based upon the underlying medical plan exposure). InPATIENT hospital claim example Major Medical Deductible Co-Insurance Out-Of-Pocket Total Out-Of-Pocket Companion Gap Inpatient Hospital Benefit Net Out-Of-Pocket With Companion Gap $3,500 Inpatient Hospital Benefit $2,000 $2,400 $4,400 $3,500 $900 Without Companion Gap $2,000 $2,400 $4,400 $0 $4,400 Outpatient Hospital Claim Example Now let s look at an Outpatient Hospital claim example. Here, assume the covered person s medical plan deductible is $2,000 and the co-insurance out-of-pocket is $600. Also assume that the employer elected the Companion Gap plan with a $2,000 Outpatient Hospital Benefit. The insured for this example underwent outpatient tonsillectomy surgery, which cost $5,000. Outpatient Hospital Claim Example Major Medical Deductible Co-Insurance Out-Of-Pocket Total Out-Of-Pocket Companion Gap Outpatient Hospital Benefit Net Out-Of-Pocket With Companion Gap $2,000 Outpatient Hospital Benefit $2,000 $600 $2,600 $2,000 $600 Without Companion Gap $2,000 $600 $2,600 $0 $2,600 *Note: Out-Of-Pocket expenses in the above illustrations do not include those amounts not covered by the insured s major medical insurance. 2

5 Understanding Companion Gap It is important that you understand Companion Gap and its provisions, definitions, limitations and guidelines defined in the Policy. The following provides information on the Companion Life Insurance Company s Group Supplemental Medical Expense Insurance Policy. COMPANION GAP OVERVIEW All Companion Gap benefits available under this policy are based on the difference between the benefit paid by the insured person s qualifying major or comprehensive medical plan and the actual charges incurred for covered out-ofpocket expenses such as deductibles, coinsurance and co-payments, subject to the exclusions/limitations and Benefit Year Maximums of the policy. Companion Gap benefits are payable to the insured or can be assigned to a provider (see Claims Procedures section). PRODUCT DESCRIPTION This is a Supplemental Medical Expense Insurance Policy that provides supplemental benefits to existing Employees qualifying for major medical or comprehensive health insurance plans. It covers certain portions of the out-ofpocket expenses the employees and their families are responsible for under their qualifying major medical or comprehensive health insurance plan. It works equally well with either fully insured or self-funded major medical plans. Benefit plans may be sold directly, depending on the state, to both large and small employer groups. POLICY TYPE Although this product may be sold as a group health plan, it is considered supplemental coverage that is an Excepted Benefit. Such supplemental coverage cannot duplicate primary coverage and must be specially designed to fill gaps in primary coverage, coinsurance and deductibles. As such, it is designed to be exempt from the renewability and accountability provisions of the Health Insurance Portability and Accountability Act of 1996 (HIPPA) and PPACA. The Companion Product to Core Medical Benefits BASIC PRODUCT FEATURES Expenses must be covered by the insured person s qualifying employer major medical or comprehensive medical plan to be covered under this policy. Covers certain portions of the insured person s costs under their qualifying employer major medical or comprehensive medical plan (co-insurance, co-pays, and deductibles) up to the maximum benefit selected. Each policy of insurance includes benefits for Inpatient Hospital, Outpatient Hospital, and Accident Only Ambulance expenses. An optional Physician Office Visit benefit may be added. Uses the primary medical plan s EOB (explanation of benefits) as a basis in determining what is covered. This policy does not pay 100% of out-of-pocket expenses. Some benefits, limitations and exclusions may vary depending on the applicant s state of residence. See Benefits/Exclusions for details. Qualified employer major medical or comprehensive medical insurance coverage is required kbabenefits.com 3

6 Companion Gap Plan Summary of Benefits Benefit Benefit Range Option Eligibility Frequency Eligible Type of Condition Eligible Type of Expense Submission Requirements Inpatient Hospital $500 - $5,000 (In increments of $500) Per person, up to 3 times per benefit year Per benefit year Eligible sickness or injury Any eligible expense of an Inpatient confinement, Inpatient surgeries, physician s in-hospital charges and routine nursery care for covered dependents *UB92 or HCFA, Primary Carrier EOB, Companion Gap Claim Form. Benefits are Assignable. Outpatient Hospital $250 - $2500 (50% of Inpatient Hospital Benefit) Per person, up to 3 times per benefit year Per benefit year Surgery, Diagnostic Testing, Emergency Room for Accident Only Any eligible expense done in free standing facility, Outpatient Hospital, Emergency Room & MRI Facility *UB92 or HCFA, Primary Carrier EOB, Companion Gap Claim Form. Benefits are Assignable. Physician Office Visit (Optional) $5 - $50 (In increments of $5) Per person per visit Per benefit year, with no maximum on the number of visits Physicians visit due to sickness, accident and routine well-child examinations and immunizations for insured dependent children Any eligible expense at doctor s office *UB92 or HCFA, Primary Carrier EOB, Companion Gap Claim Form. Benefits are Assignable. Ambulance $350 Per person, up to 3 times per family Per benefit year Accident Only within 72 hours Air or Ground *UB92 or HCFA, Primary Carrier EOB, Companion Gap Claim Form. Benefits are Assignable. *UB92 is the claim form used for hospital and facility claims/*hcfa is the claim form used by physicians for services billed in an office setting. A Companion Gap Claim Form is only necessary if all information is not provided on the UB92/HCFA. The Benefit Matrix does not supersede any Coverage, Benefit, or Requirements as outlined in the Certificate of Insurance or Master Policy. COMPANION GAP INPATIENT HOSPITAL BENEFIT When an insured is confined to a hospital as an Inpatient due to an eligible sickness or injury, the policy will pay up to the selected Benefit Year Maximum per person for: Expenses incurred as a result of such confinement that are covered under the insured person s major medical or comprehensive medical plan; Expenses are applied to any deductible, coinsurance or co-payment amounts required to be paid by the insured person under such plan; Benefits that are not excluded under this policy; and Benefits that do not exceed the per Benefit Year Maximum of this policy. Includes coverage for: Eligible Inpatient hospital stays; Inpatient surgeries; Physician s in-hospital charges; and Routine nursery care for covered dependent children. 4 Per Person Benefit Year Maximum Options: $500 - $5,000 in increments of $500. Per Family Benefit Year Maximum: 3 times the per person Benefit Year Maximum.

7 COMPANION GAP OUTPATIENT HOSPITAL BENEFIT When an insured receives treatment as an outpatient due to an eligible sickness or injury, the policy will pay up to 50% of the Inpatient Benefit Year Maximum per person for: Expenses incurred as a result of such treatment that are covered under the insured person s major medical or comprehensive medical plan; Expenses are applied to any deductible, coinsurance or copayment amounts required to be paid by the insured person under such plan; Benefits that are not excluded under this policy; and Benefits that do not exceed the per Benefit Year Maximum of this policy. Includes coverage for: Treatment in a hospital emergency room for an injury due to an accident when the insured person is not subsequently considered an Inpatient; Surgery performed in a hospital outpatient facility or a free-standing outpatient surgery center; and Radiological diagnostic testing performed in a hospital outpatient facility or a magnetic resonance imaging (MRI) facility. This benefit does not cover: Emergency room charges for sickness. Prescription drugs or lab fees. Surgical procedures performed in a physician s office. Per Person Benefit Year Maximum Options: Pays up to 50% of Inpatient Hospital benefit. Per Family Benefit Year Maximum: 3 times the Per Person Benefit Year Maximum. COMPANION GAP AMBULANCE BENEFIT ACCIDENT ONLY When an insured person requires ambulance transportation (ground or air) to a hospital or emergency center for injuries sustained in an accident, Companion Gap will pay up to $350 per insured person, per Benefit Year for: Expenses incurred as a result of such transport that are covered under the insured person s major medical or comprehensive medical plan; Expenses are applied to any deductible, coinsurance or co-payment amounts required to be paid by the insured person under such plan; Benefits that are not excluded under the policy; and Benefits that do not exceed the per Benefit Year Maximum. Per Family Benefit Year Maximum: 3 times the Per Person Benefit Year Maximum. Ambulance transportation must occur within 72 hours of a covered accident and must be provided by a licensed professional ambulance company. COMPANION GAP PHYSICIAN OFFICE VISIT BENEFIT (OPTIONAL) When an insured person receives treatment from a physician in a physician s office on an outpatient basis, the benefit amount selected is payable if: The incurred expense is a result of treatment that is covered under the insured person s major or comprehensive medical plan; The covered expense is incurred while the insured person is not an Inpatient; and The incurred expense is not excluded under this policy. Includes coverage for: Treatment by a physician due to sickness; Treatment by a physician for an injury due to an accident; and Routine well-child examinations and immunizations for insured dependent children. Per person, per visit: $5-$50 in $5 increments. Benefit Year Maximum: None. 5

8 EXCLUSIONS The Policy does not provide any benefits for the following: 1) Any expenses incurred during any period the insured does not have coverage under a qualifying employer plan; 2) Suicide or any attempt thereat, while sane or insane (in Colorado or Missouri, while sane); 3) Any intentionally self-inflicted injury or sickness, while sane or insane (Colorado or Missouri, while sane); 4) Rest care or rehabilitative care and treatment; 5) Voluntary abortion except, with respect to the insured or the insured s dependent spouse: a) Where the insured s or the insured s dependent spouse s life would be endangered if the fetus were carried to term; or b) Where medical complications have arisen from abortion; 6) Pregnancy of a Dependent child, except Complications of Pregnancy; 7) Any Injury or Sickness as a result of participation in a riot, civil commotion, civil disobedience or unlawful assembly. This does not include a loss, which occurs while acting in a lawful manner within the scope of authority. For purposes of this exclusion, participation means to take an active part in common with others; riot means any use or threat to use force or violence or disturbance by three or more persons without authority of law; 8) An insured person engaging in any act or occupation which is a violation of the law of the jurisdiction where the loss or cause of loss occurred. A violation of law includes both misdemeanor and felony violations; 9) Participation in a contest of speed in power driven vehicles, parachuting, parasailing, bungee jumping, scuba diving, stunt driving, rock climbing, flying ultra-light aircraft, skydiving, hang gliding or any hazardous sports activity for exhibition purposes; 10) Injury or Sickness as a result of air travel, except; a) as a fare-paying passenger on a commercial airline on a regularly scheduled route; or b) as a passenger for transportation only and not as a pilot or crew member; 11) Any Injury that occurs while an insured person has been determined to be intoxicated: a) by judicial or administrative judgment or order; b) By evidence of an alcohol concentration in the insured person s blood, breath or urine which equals or exceeds the limits set by applicable motor vehicle laws; or c) Or hallucinatory drug, unless the same was administered on the advice of a Physician and was taken according to the prescribed dosage; and the use of such substance was a proximate cause of the Injury; 12) Alcoholism; or drug use, unless administered on the advice of a Physician and was taken according to the prescribed dosage; 13) Procedures associated with sex changes; 14) Any treatment, drugs or surgery considered experimental by the American Medical Association, the Health Care Finance Administration or the Federal Drug Administration; 15) Any loss while the insured person is in the service of the Armed Forces of any country. Orders to active military service for training purposes of two months or less will not constitute service in the Armed Forces. Upon notice to the Company of entering the Armed Forces, the Company will return to the insured person pro rate any premium paid, less any benefits paid, for any period during which the insured person is in such service; 16) Injury or Sickness for which compensation is payable under any Workers Compensation Law, any Occupational Disease Law or similar legislation; 17) Mental illness or functional or organic nervous disorders, regardless of the cause; 18) Dental or vision services, including, but not limited to, treatment, surgery, extractions or x-rays, unless: a) Resulting from an Injury occurring while the insured person s coverage under the Policy is in force and if performed within 12 months of the date of such Accident; or b) Due to congenital disease or anomaly of a Dependent newborn child; 19) Routine examinations, {other than well child examinations if the Physician Office Visit Benefit is listed in the Schedule of Benefits,} such as health exams, periodic check-ups or routine physicals; or 20) Any expense for which benefits are excluded under the insured person s qualifying employee plan. Not available in all states. Some provisions, benefits, exclusions or limitations may vary by state. 6

9 Companion Gap Group Guidelines GROUP ELIGIBILITY Employer groups are the only eligible groups. This means any firm, corporation, partnership or sole proprietor that is actively engaged in business; is not formed primarily for the purpose of buying health insurance; and, in which a bona fide employer-employee relationship exists. The Employer Group must: Be offered in, or have a clearly defined division in a state where the policy is available; Offer a qualifying major or comprehensive medical plan to his/her employees that contains out-of-pocket expense responsibilities (deductible, coinsurance and/or co-pay requirements); and Meet the policy s group size and participation requirements. Group size requirements: 1) For 5-99 eligible employees - 50% participation with 5 or 10* enrolled employee minimum. 2) For 100+ eligible employees - 25% participation with 50 enrolled employee minimum. For participation purposes, only those employees who are covered under one of the employer s qualifying major or comprehensive medical plans will be considered eligible employees. The total number of employees participating in all of the employer s qualifying major or comprehensive medical plans will be considered when determining the participation percentage. Spouses and dependent children do not count towards the eligible lives or participation requirements. *Subject to State specific minimum. Always verify the current state approval and requirements by visiting the KBA website at RENEWALS All groups are experience rated annually upon anniversary. At the time of renewal, if participation is below the required levels, Companion Gap may not be offered during that year. Reapplication for coverage may be made when the employer group meets required participation levels. INSURED ELIGIBILITY Issue/Eligibility ages: Employee: Minimum = 18 Maximum = None Spouse: Minimum = 18 Maximum = None Children: Minimum = 0 Maximum = 26 Employees must meet the following criteria to be eligible: Must be an employee** of an approved employer group. Must be actively at work on the employees effective date of coverage. Must be covered under a qualifying employer major or comprehensive medical plan (this does not include a limited benefit medical plan). **To qualify for benefits, an employee must be a W2 d employee of the employer employees of any arrangement are not eligible kbabenefits.com 7

10 Insured Eligibility continued, Spouses and dependent children of employees must meet the following criteria to be eligible: Spouse must be the insured employee s lawful spouse. Dependent children include the unmarried dependent child or children of the insured employee or of the insured employee s lawful spouse. Dependent children must be under 26 years of age. Dependent children may also include the unmarried handicapped dependent child(ren) of the insured employee or of the insured employee s lawful spouse who has attained age 19, provided such child was insured on the day immediately prior to attaining age 19, is mentally handicapped or physically incapable of earning his/her own living. Proof of incapacity must be furnished to the company, but not more than once in a 12 month period. Dependent children includes a step-child, foster child, legally adopted child, child for whom the insured is a party to a suit for adoption, child who has been placed in the insured s home for adoption and child under the insured s legal guardianship, if such child depends primarily on the insured for support. Dependent will also include a child for whom the insured is legally required to support due to court order or divorce decree. A spouse or child covered under the policy as an insured will not be eligible as a dependent. If a husband and wife are both covered as insured employees, a child will be the dependent of only one parent. Must be covered under a qualifying employer major or comprehensive medical plan (this does not include a limited benefit medical plan). Must meet the issue/eligibility age requirements. Must be engaged in the dependent s regular and customary activities. The following additional criteria applies to eligibility: Actively at Work/Active Employment means the insured person is performing the material and substantial duties of the insured person s regular occupation on a full-time basis at the insured person s regular place of employment or at any business location to which the insured person is required to travel. For the purposes of this definition, a vacation day, holiday or an authorized leave of absence not due to an injury or sickness is considered a regular work day. Regular and Customary Activities means 1) for the insured or a working dependent, he or she is actively performing all the duties of his or her regular occupation; and 2) for a non-working dependent, he or she is regularly performing the normal activities of a person of like age and good health. Employees are not eligible for plans with benefit maximums that could exceed the overall out-of-pocket expenses under their qualifying employer plan or comprehensive medical plan. Employees, their spouses, and dependent children must be covered under the same plan of benefits. Employees, their spouses, and dependent children must not be covered under any other supplemental medical expense plan. A qualifying employer plan does not include any limited benefit medical plan, Medicare, Medicaid, CHAMPUS, or TRICARE. Coverage available: Employee, spouse, and dependent children. Note: Employee must be covered for dependents to be covered under Companion Gap. Total disability/totally disabled: This term means that because of injury or sickness, the insured person cannot perform the insured person s regular and customary activities. The loss of a professional or occupational license for any reason does not, in itself, constitute total disability. PLAN DESIGN REQUIREMENTS Each employer must select the benefit amount for the group plan. The Inpatient Hospital Benefit Maximum selected may not exceed the insured s total out-of-pocket (deductible, coinsurance, and co-pays) exposure under the employer s medical plan. In most instances, the employer will select a Companion Gap benefit maximum that is less than that total exposure. Although Companion Gap is designed based on the out-of-pocket exposure of the employer s major medical plan, benefits may be paid for insured dependents that are not covered under the Employee s major medical plan, but are covered under another major medical plan. Dependents whose other coverage has lower out-of-pocket exposure than is appropriate for the employer s Companion Gap plan should not enroll. 8

11 BENEFIT YEAR The applicable Benefit Year (MMDD to MMDD) must also be selected on the employer s application. The Benefit Year defines the beginning and ending dates of the 365-day period to which the Policy s benefit maximums and deductible (if any) applies. The Companion Gap Benefit Year should match the major medical plan s period to which its out-of-pocket expense maximums apply. MULTIPLE PLANS Only one Companion Gap plan (or two Companion Gap plans if one is Employer-paid and the other is a buy-up option) may be sold per major medical or comprehensive health insurance plan maintained by an Employer. BUY-UP OPTION Out-of-pocket costs can still be overwhelming to an employee. In this case, assume the employee will have a $1,000 deductible and a $2,000 co-insurance/co-pay. The employer only offers a $1,000 Companion Gap benefit; the insured will be responsible for an additional $2,000. The Buy-Up Option allows the employee to purchase an additional benefit (benefits amount is selected by the employer) to further help offset the costs of deductibles, co-insurance, and co-pays. Companion Gap buy-up example Deductible Co-Insurance & Co-Pays Total Out-Of-Pocket Companion Gap Benefit (Employer Paid) Employer Voluntary Buy-Up Option Net Out-Of-Pocket With Companion Gap Buy-Up Option $1,000 $2,000 $3,000 $1,000** $1,500 $500** w/o Companion Gap Buy-Up Option $1,000 $2,000 $3,000 $1,000** $0 $2,000** *The Buy-Up option is subject to participation requirements and if these are not met, the Buy-Up Option will not be available. **Note: Out-Of-Pocket expenses in the above illustrations do not include those amounts not covered by the insured s major medical insurance. Employers who purchase an employer-paid plan for which the maximum Inpatient benefit amount is less than the total major medical plan out-of-pocket expense may also include a buy-up option for his/her employees. The employer must pay the entire premium for a minimum of $500 Inpatient Companion Gap benefit for all employees covered by the employer s group medical plan(s) (Companion Gap Eligible Employee). The employer may select an additional Inpatient Hospital benefit amount to make available for his/her employees to purchase. This amount, when combined with the employer-paid plan s maximum benefit amount, may not exceed the insured s total out-of-pocket exposure under the major medical plan. The buy-up amount that is selected by the employer will apply uniformly to each Companion Gap Eligible employee. It cannot vary by individual within the group. If the employer has more than one group medical plan, or variations of deductibles and co-pays within a single plan, each medical plan or coverage level can have a different buy-up amount, but this amount cannot vary by individual within each plan or variation of coverage. The buy-up option is only available during the annual enrollment period and is subject to the policy s participation requirements. If not met, the buy-up option will not be available kbabenefits.com 9

12 INCREASE IN COMPANION GAP COVERAGE The Inpatient Hospital Benefit Maximum and Outpatient Hospital Benefit Maximum amount may be increased to accommodate a change in primary major medical or comprehensive medical plan, or as an employee option (buy-up) for groups that offer an employer-paid plan for which the maximum Inpatient benefit amount is less than the total major medical plan out-of-pocket expense. If coverage is increased due to a change in the major medical coverage, documentation of such change, a new employer application and new individual enrollments are required. Claim Procedures Benefits are paid directly to the insured unless assigned to a provider. Claim forms, EOB s, and itemized billing statements can be sent by mail, fax, or . ASSIGNMENT OF BENEFITS PROCESS We are very pleased to be able to make the Companion Gap Benefit assignable to Health Care Providers. In most cases this will streamline and simplify the Companion Gap claim filing process for the covered member. For convenience and to promote a better understanding of the claim payment process when benefits are assigned, please refer to the ASSIGNMENT OF BENEFITS Workflow Process document in the ASSIGNMENT OF BENEFITS section at MANUAL CLAIMS PROCESS The insured is responsible for filing his or her own claim with the Plan Administrator (Key Benefit Administrators) and for paying the providers. The major medical or comprehensive medical plan s Explanation of Benefits (EOB) is the initial basis for determining what is covered under this policy. An accompanying itemized bill/physician s statement may also need to be submitted if the EOB does not contain diagnostic codes. Companion Gap may not pay 100% of the insured s out-of-pocket expenses. Examples of procedures & services not covered are: Procedures and services not covered under the insured person s major medical plan Out-of-pocket expenses in excess of this plan s maximum benefits Treatment for Mental & Nervous conditions* Treatment for Alcoholism or Drug Abuse* Prescription drugs (unless received while an Inpatient) Treatment and therapies such as physical and occupational therapy, radiation and chemotherapy (unless received on an Inpatient basis) Surgical procedures performed in a physician s office* Treatment not received from a hospital, a freestanding surgical center, or an MRI facility. Urgent care facilities and clinics are not covered facilities under the Inpatient Hospital or Outpatient Hospital Benefits* Note: The policy does not contain a pre-existing condition provision. Pregnancy is covered the same as any other illness for insured employees and their insured spouses. Pregnancy (except for Complications of Pregnancy) is not covered for dependent children, unless it is a state requirement. *May not be covered in all states. 10

13 Companion Gap Enrollment Period The original enrollment period prior to the group effective date may be selected on the employer s application. Subsequent annual enrollment periods will be effective on the date requested by the employer at the time of application and should match that of the qualifying employer major or comprehensive medical plan. If an annual enrollment period is not specified, it will be effective on the policy anniversary date and limited to a period of 31 days. NEW HIRES Enrollment periods for new employees should match those of the employer major or comprehensive medical plan. LATE ENTRANTS A late entrant is a person who enrolls for coverage under the policy more than 31 days after her/she initially becomes eligible. Late entrants may not enroll for coverage until the next open enrollment period. Late entrants will be subject to a benefit waiting period. (see limitations) POLICY EFFECTIVE DATE/ACTIVELY AT WORK REQUIREMENTS The following guidelines apply to policy effective date: Application and enrollment form dates must be prior to coverage effective date; All policies and certificates of insurance will be effective on the first day of a month; and A check for the first months premium must be received in order for coverage to take effect. The following guidelines apply to individual coverage effective dates: Enrollment form date must be prior to the coverage effective date; All coverage will be effective on the first day of a month; A check for the first months premium must be received in order for coverage to take effect; and If the employee is not actively at work, or an enrolled spouse and/or dependent child is unable to perform the normal activities of person of like age in good health, coverage for that individual will be deferred until the first of the month following their return to full eligibility status. * Coverage under the policy for a newborn child, adopted child, child placed with the insured employee for adoption, or child for whom the insured employee is a party in a suit to adopt will be effective from the moment of birth, adoption, placement, or filing of such suit and will continue until the next premium due date or 31 days, whichever is later. After the premium due date or 31 days, if additional premium is required, coverage will continue only if the Company has been notified in writing and any additional premium due has been paid. Coverage for a newly born child will include coverage for injury, sickness, congenital defects, birth abnormalities and premature birth. In no event will coverage for such child become effective before the insured employee s effective date. The Companion Product to Core Medical Benefits kbabenefits.com 11

14 Companion Gap Termination POLICY Companion Life Insurance Company (CLIC) may terminate the Companion Gap policy on any date on or after the first policy anniversary date. Written notice must be provided at least 31 days prior to termination. The Policy holder may terminate the Companion Group policy on any date on or after the first policy anniversary. CLIC will terminate the employer s plan(s) on the next premium due date if fewer persons are insured than are required by underwriting guidelines. CLIC will terminate the employer s plan(s) if the employer s qualifying plan or comprehensive medical plan is changed or terminated. CLIC may terminate their plan(s) on any premium due date with at least 31 days advance written notice. The employer may terminate their plan(s) on any premium due date with at least 31 days advance written notice. EMPLOYEE S COVERAGE Insurance coverage for an insured employee ends on the earliest of these dates: The date the policy or employer s qualifying plan terminates; The date the required premium has not been paid, except as provided in the Grace Period provision. The date the insured employee retires, is no longer and employee of the policyholder or is no longer actively at work; or The date the insured employee s qualifying or comprehensive medical plan coverage terminates. DEPENDENT(S) COVERAGE Insurance coverage on an insured dependent ends on the earliest of these dates: The date the insured employee s coverage terminates; The date the required premium has not been paid, except as provided in the Grace Period provision. The date the insured dependent no longer meets the definition of dependent; The date the insured dependent s major or comprehensive medical plan coverage ends; or The date the policy is modified to exclude dependent coverage. Companion Life Insurance Company (CLIC) may end coverage of any insured person who submits a fraudulent claim. Companion Gap Premium The premium structure provides rates for employee only, employee + spouse, employee + child(ren), and employee + family. Rates are in two employee age bands (18-54 & 55+). The effective date of any rate change due to an insured employee s age change (moving into an new age bracket) will be the policy or participating organization s renewal date, NOT on the insured s birthday. All premium modes are available (weekly, bi-weekly, semi-monthly, monthly, 9-monthly, and 10-monthly). Rates are based on: The insured employee s age The benefit amounts elected The family members covered The major or comprehensive medical plan s deductible If the plan does not have a deductible, the following rules will be used to convert the major medical plan s coinsurance and/or co-pay requirements into an equivalent deductible to determine applicable premium rates. There is no specific rate distinction for different co-insurances (i.e. 80/20 vs. 50/50). The rates assume a blend of coinsurance levels. The first month s premium is due on or before the policy effective date. 12

15 Companion Gap Coinsurance / Co-Pay Conversion Rules Determining the applicable major medical plan deductible rate category for a plan where that deductible falls between two plan deductible options on the rate chart: Round to the closest deductible in the rate chart (if equidistant, use the higher deductible amount). Determining the applicable major medical plan deductible rate category for plans with co-pays only: Use the highest co-pay multiplied by the maximum days where co-pay may be paid. Example: Inpatient hospital co-pay of $400 per day, maximum 5 days = $2,000 If no day maximum exists, use the co-pay amount. Round to the closest deductible in the rate chart if necessary (if equidistant, use the higher deductible amount ). This rule does not apply to low co-pays ($50 or less). Determining the applicable major medical plan deductible rate category for plans with both deductible and Inpatient co-pay: Deductible under $500: Add the major/comprehensive medical plan deductible and ½ of the maximum Inpatient co-pay. Deductible over $500: Add the major/comprehensive medical plan deductible and ¼ of the maximum Inpatient co-pay. Round to closest deductible in the rate chart if necessary (if equidistant, use the higher deductible amount). Companion Gap Policy Limitations PRE-EXISTING CONDITIONS Companion Gap does not have a pre-existing condition limitation, however, a condition must be covered under the Insured s qualifying major or comprehensive medical plan in order for benefits to be payable under this policy. Therefore, any pre-existing condition limitation applied to the major medical plan would in effect limit coverage under this policy. WAITING PERIOD FOR LATE ENTRANTS Benefits for late entrants will be limited to the Physician Office Visit Benefit during the waiting period. After the expiration of the waiting period, late entrants will be eligible for all benefits listed in the Schedule of Benefits for any covered charge that is incurred after such waiting period. For this provision, waiting period means the first 30 days following the late entrant s effective date, and does not apply to the Ambulance Benefit. Companion Gap Policy Provisions COBRA Coverage is COBRA eligible as long as coverage under the qualifying major medical or comprehensive medical plan does not terminate. CONTINUATION OF COVERAGE Coverage under the policy will continue for up to 31 days following termination of an insured s coverage or until the insured otherwise becomes entitled to similar coverage from some other source, if sooner. This provision will not apply if coverage under the insured s qualifying major or comprehensive medical plan terminates and the employer s qualifying plan does not have a similar continuation of coverage provision. EXTENSION OF BENEFITS This Companion Gap policy provision applies if an insured person is confined to a hospital or totally disabled on the termination date of the policy, unless termination is due to nonpayment of premiums. Companion Life Insurance Company (CLIC) will pay the same benefits for the duration of any hospital confinement or total disability, or 90 days thereafter, whichever occurs first, if: 1) the insured person has incurred covered charges before the termination date; and 2) any hospital confinement or total disability begins before the termination date. No further premium payment is required to qualify for this extension of benefits. This provision will not apply if coverage under the employer qualifying major or comprehensive medical plan terminates and that plan does not have a similar extension of coverage provision. 13

16 General Contact Information POLICY AND CERTIFICATE Each employer will receive a policy and an administration kit. Each employee will receive a certificate packet including valuable how to information to assist them with understanding their benefits. CASE ADMINISTRATION Companion Gap is a group supplemental medical expense limited benefit policy distributed through Key Benefit Administrators (KBA) and underwritten by Companion Life Insurance Company (CLIC). Companion Gap is administered by KBA. Requirements to sell Companion Gap: 1) Licensed and appointed agent with CLIC (see licensing information under group forms section). 2) Verify the product is approved in the state in which you are licensed and writing business. CONTACT INFORMATION FOR ADMINISTRATION AND CARRIER Key Benefit Administrators (KBA) KBA is one of the largest, privately held third party administrators (TPA) organizations in the country. KBA is licensed as a TPA, where required. KBA services a large variety of group benefit plans and provides various functions like policy issue, billing and collection, customer service, claims, COBRA continuation, HRA, HSA, FSA, and Section 125 administration. It serves over half a million members, and processes over two million transactions per year. The company has offices in Indianapolis, Indiana and Ft. Mill, South Carolina. For further information on KBA, contact: Regular mail: Key Benefit Administrators Express delivery: Key Benefit Administrators PO Box Rivercrossing Drive Fort Mill, SC Fort Mill, SC Contact Info: Phone: Fax: Broker hotline companiongap.broker@keybenefit.com Group billing companiongap.enroll@keybenefit.com New Business companiongap.newgroup@keybenefit.com Customer Service Claims Companion Life Insurance Company (CLIC) CLIC is the insurance company underwriting the Companion Gap plan. The company is located in Columbia, SC, and has been rated A+ (Superior) based on an analysis of the financial position and operating performance by A.M. Best Company, an independent analyst in the insurance industry. kbabenefits.com Companion Gap Sales and Service Materials To view please go to Agent licensing Employee Brochure Agent Commission Form, Employer Application, Employee Enrollment Form, New Case Transmittal Claim Form New Case Submission Checklist 16