Table of Cotets Geeral Iformatio 3 Overview 3 Portability 3 Notice to Participats ad Employees 3 Eligibility 3 Core Pla 4 Exteded Health Care 4 Detal 5 Out of Provice Emergecy Travel Beefits 6 Cost-Plus Pla 6 Overview 6 Time ad Dollar Limits 6 Eligible Health Expeses 7 Tax Implicatios of the Fud 8 Uicorporated Physicias 8 Professioal Corporatios 10 Tax Advatage Example 11 How to Eroll 11 Core Pla 11 Cost-Plus Pla 11 Erollmet Deadlie 11 Coverage Details 12 Whe Coverage Begis 12 Participat Coverage Chages 12 Termiatio 12 Claims Process 12 Submittig a Claim 12 Coordiatio of Beefits 12 Core Pla Exclusios ad Limitatios 13 Exteded Health Care 13 Detal 13 Out of Provice Emergecy Travel Beefits 14 Questios 15 The AMA Advatage The AMA Health Beefits Trust Fud has established a Private Health Services Pla (PHSP) as defied by the Icome Tax Act of Caada. Fud trustees are AMA physicia members; the trust is admiistered by ADIUM Isurace Services Ic. (ADIUM). Both the Core Pla ad the Cost-Plus Pla are what are kow as self-isured beefit plas. AMA Health Beefits Trust Fud Overview
Geeral Iformatio Overview The AMA Health Beefits Trust Fud (the Fud) provides exteded health care ad detal plas to help cover costs for services ot paid by the provicial health isurace pla. Two distict compoets of the Fud eable physicias to customize their health care plas to suit their eeds: Core Pla: A basic, competitively priced exteded health care ad detal pla Cost-Plus Pla: A optioal self-isured pla to cover eligible health expeses ot icluded i the Core Pla The PHSP provided by the Fud satisfies icome tax requiremets that allow AMA members to provide beefits i a tax-effective maer for themselves, their families ad their employees. I geeral, pla costs are tax deductible ad are ot a taxable beefit to pla participats. Portability You ca participate i the AMA Health Beefits Trust Fud if you reside aywhere i Caada provided you are a eligible member of the AMA or Northwest Territories Medical Associatio (NWTMA). Notice to Participats ad Employees The Core Pla s Exteded Health Care ad Detal plas are provided o a self-isured basis. Alberta Blue Cross, o behalf of the Fud, admiisters the Core Pla, but Alberta Blue Cross is ot isurig the beefits provided by the Core Pla. The Isurace Act of Alberta requires that the Fud, which is providig eligible health ad detal beefits through the Core Pla, provide a writte disclosure to employees of the physicia employer or a professioal corporatio employer that the beefits uder the Core Pla, like the beefits uder the Cost-Plus Pla, are ot provided by or through a isurace cotract. The fiacial obligatio for providig these beefits to employees is that of the Fud through the premiums paid to the Fud by employers, ad if applicable premiums paid by employees. Please cotact ADIUM Isurace Services Ic. for further iformatio about this aspect of the beefits provided by the Core Pla. Eligibility Core Pla To be eligible for the Fud s Core Pla a participat must be: A eligible member i good stadig of the AMA or NWTMA, A employee of a participatig member who is workig a miimum of 21 hours per week, ot workig temporarily or seasoally, ad A residet of Caada Cost-Plus Pla To be eligible for the Cost-Plus Pla a participat must be erolled uder the Core Pla. The Cost-Plus Pla is optioal. Defiitio of eligible depedets Depedet refers to a spouse ad/or umarried childre uder age 21 (26, if regularly attedig school o a full-time basis at a accredited istitute of learig) ad childre over age 21 who are metally or physically hadicapped. Spouse refers to a husbad or wife by virtue of a religious or civil marriage ceremoy; or to a parter of the same or opposite sex livig with a Fud participat, if publicly represeted as the spouse, ad if the participat has cohabited with the parter for 12 cosecutive moths. Child refers to a participat s atural child, legally adopted child, or stepchild uder legal guardiaship, who is solely depedet upo the participat for support. AMA Health Beefits Trust Fud Geeral Iformatio 3
Core Pla The Core Pla is self-isured (see page 3, Notice to Participats ad Employees). Alberta Blue Cross provides admiistratio services to the Fud to admiister the beefits which are provided by the Core Pla. The Core Pla is fuded by premiums paid by the participats ad employers i the pla. The premiums are set by the Trustees from time to time, based o the claims experiece of the Core Pla ad other factors. Coverage categories The Core Pla has the followig coverage ad rate categories: Sigle Couple (icludes a sigle paret ad oe child) Family Premiums Premiums for coverage for participatig physicias, depedets ad eligible employees are payable by the physicia through mothly pre-authorized chequig oly. If a premium-split arragemet is made betwee the physicia ad the employee, it is hadled through the participatig physicia s payroll system. Rates Mothly premium rates are determied by age (uder age 70, age 70 74, ad age 75 ad older) ad family status (sigle, couple, family). Premium rates are set each year o September 1. Please see rate iformatio provided separately or cotact ADIUM. The Core Pla is a basic exteded health care ad detal pla coverig the followig: Exteded Health Care Prescriptio drugs 70% co-isurace, up to a maximum of $600 for each participat ad each depedet, per policy year (September 1 August 31) Please ote Co-isurace (i.e., 70% co-isurace) refers to the percetage of the claim paid by the pla. The remaider, if ay, is paid by the participat. The stated maximum dollar beefit is the total amout that will be paid i the stated time period. Direct billig of drug products which, by law, must be obtaied oly with the prescriptio of a prescriber ad which are authorized as beefits by Alberta Blue Cross. These products must be dispesed by a licesed pharmacist. Least-cost-alterative pricig: This pla will pay based o the least-cost-alterative price where iterchageable products ca be used to fill prescriptios. Allergy serums prescribed by a licesed physicia, drug prophylaxis for occupatioal exposure to HIV or Hepatitis, ad isuli ad diabetic supplies whether prescribed or ot, are also beefits. Diabetic supplies iclude eedles, syriges, lacets, pelets, ad urie ad blood glucose testig strips. This is a summary of the importat features of the prescriptio drug beefit. It may chage because of aouced chages by the Federal Govermet o what prescriptio drugs are eligible for the medical expese credit described i the Icome Tax Act ad Regulatios. The followig beefits are covered at 100% co-isurace, except where idicated. Ambulace services: Professioal groud ambulace to or from a hospital, i the evet of illess or ijury, up to the maximum set i the curret Alberta Blue Cross schedule of ambulace rates Preferred hospital accommodatio: Coverage for semi-private ad private rooms Paramedical services: Up to $40 per visit to a maximum of $480 per perso each policy year for services received from a physiotherapist ad speech laguage pathologist (oce all govermet fudig has bee fully accessed). Up to $40 per visit to a maximum of $480 per perso each policy year for services received from a chiropodist or podiatrist. Accidetal detal care: Reasoable charges, as determied by Alberta Blue Cross, for services redered by a licesed practitioer, to a maximum of $2,000 per participat per accidet for the repair, extractio ad/or replacemet of a participat s atural teeth by a direct, accidetal blow to the mouth Psychologist: Up to $50 per visit to a maximum of $500 per participat each policy year for idividual or family couselig by a chartered psychologist for treatmet of metal or emotioal illess Home ursig: Up to a maximum of $15,000 per participat i ay three-year period for ursig services provided by a registered or practical urse (pre-approved basis oly) 4 AMA Health Beefits Trust Fud Core Pla
Hearig aids: Charges for the purchase of hearig aids o the writte order of a physicia or audiologist, or the repair to a combied maximum of $600 per participat i ay four-year period Auxiliary care: Up to a maximum of $1,000 per participat each policy year Foot orthotics: Up to a maximum of $200 per participat per policy year o the writte order of a physicia or podiatrist Orthopedic shoes: Maximum of $250 per participat each policy year. Custom-made orthopedic shoes ad/or adjustmets to stock item footwear o the writte order of a physicia (stock item footwear excluded) Custom-fitted braces: Oce i a 24-moth period for custom-fitted braces, which icorporate a rigid metal or plastic support, o the writte order of a physicia Blood-testig moitors: Up to a maximum of $150 oce i ay five-year period o the writte order of a physicia Wheelchairs: Maual wheelchairs certified i writig by the attedig physicia as medically ecessary for the coditio of the participat. Purchase of a wheelchair is limited to a maximum of oe wheelchair per participat i ay three-year period o a pre-approved basis oly Medical aids: Splits, cervical collars, trusses, crutches, casts, caes, walkers ad tractio kits (walkers ad tractio kits are provided o the writte order of a physicia) Detal $600 maximum for each participat ad each depedet, per policy year (September 1 August 31) Coverage is for usual ad customary detal fees, as determied by Alberta Blue Cross, ad will be based o charges applicable i the provider s provice of detal practice. Basic detal 80% co-isurace Diagostic Recall or specific exam: Oe i six moths if uder 19, oe i 12 moths age 19 ad over per detist Bite-wig X-rays: Oe set i six moths if uder age 19, oe set i 12 moths for age 19 ad over Paoramic or full mouth series: Oe i 24 moths Comprehesive exam: Oe per participat i ay i five year period for covered detal specialty Cosultatios: If supplied for covered services by a cosultat detist o the formal request of a referrig detist Emergecy exams: Whe ecessary due to sudde developmet of pai or accidet Prevetative Cleaig: Oce i six moths if uder age 19 ad oce i 12 moths for age 19 ad over Scalig ad root plaig: Maximum of six uits every 12 moths Fluoride: Oe i six moths if uder age 19 ad oe i 12 moths for age 19 ad over Pit ad fissure sealat: Limited to idividuals uder 19 ad permaet posterior teeth oce i five years Space maitaiers: If provided to maitai ad ot regai space for missig primary teeth Fillig repair or replacemet: Oe per tooth surface i 24 moths uless special eed is show Filligs: Composites o posterior ad aterior teeth Prevetative: Direct applicatio veeers to restore teeth to form ad fuctio Edodotics Geeral edodotic exam: Oe i five years Root caal therapy: Oce per tooth i ay 24-moth period Prosthodotics removable Deture relies ad liers: Oe i 24 moths Deture repair: All repairs, icludig those requirig impressios Tissue coditioig: Oe i 24 moths Surgical procedures Procedures for extractios ad other oral surgery icludig pre- ad post-operative care Geeral surgery exam: Oe i five years Geeral aesthesia: Facilities for geeral aesthesia whe required i cojuctio with covered detal surgery (or where medically ecessary with prior approval) Periodotics 60% co-isurace Geeral periodotic exam: Oe i five years Recall or specific exam: Oe i 12 moths per detist Scalig ad root plaig: No uit maximum Surgical: Periodotal surgery, osseous surgery, osseous grafts, soft tissue grafts No-surgical: Provisioal splitig, scalig ad root plaig i excess of six uits i 12 moths, maagemet of oral ifectios, desesitizatio AMA Health Beefits Trust Fud Core Pla 5
Out of Provice Emergecy Travel Beefits Up to $5,000,000 CDN i emergecy medical beefits per participat per icidet. Protects participats for busiess or vacatio travel for 60 days of travel per trip (extesios of coverage for Alberta residets are available through Alberta Blue Cross o a idividual basis, if purchased prior to the trip). Coverage icludes: travel assistace, hospital accommodatio, icidetal expeses (up to $50 per day to a maximum of $500), outpatiet services, physicia ad surgeo charges, ursig care, ambulace, medical evacuatio, paramedical services (up to $300 per eligible specialty), prescriptio drugs, diagostic services, medical aids, accidetal detal (up to $2,000), detal pai relief (up to $300), retur of depedet childre, retur of pet (up to $500), retur of persoal items (up to $500), retur of deceased (up to $7,000), idetificatio of deceased (up to $250 per day to a maximum of 3 days for meals ad accommodatio, plus oe roud trip ecoomy airfare), crematio or burial (up to $2,500), vehicle services (up to $1,000), meals ad accommodatios (up to $250 per day to a maximum of $2,500) ad family/fried hospital visits (up to $250 per day to a maximum of $2,500 for meals ad accommodatio, plus oe roud trip ecoomy airfare). This beefit is provided by Alberta Blue Cross o a isured basis through a group isurace cotract with the Fud. The Out of Provice Emergecy Travel beefit termiates upo attaimet of your 75th birthday. Coverage for your spouse (if applicable) will also termiate upo your attaimet of age 75, regardless of what age your spouse is at the time. This is a summary of the importat features of the Core Pla. The exact terms ad coditios of this pla are described i the cotract issued to the AMA Health Beefits Trust Fud by Alberta Blue Cross. I the evet of a discrepacy betwee this brochure ad the cotract, the cotract will be deemed accurate ad prevails. Please see Exclusios ad Limitatios sectio (page 14) for exclusios applicable to the Core Pla. Cost-Plus Pla Overview The Cost-Plus Pla is a self-isured pla that allows physicias to provide eligible health ad detal beefits ot covered by the Core Pla to themselves, their depedets ad their employees. As a self-isured pla, there are o premiums. The Cost-Plus Pla utilizes curret icome tax rules which allow employers to provide health beefits ad use the paymets as a tax deductio for their icorporated or uicorporated busiess. Physicia employers may thus ejoy the same beefits afforded other Caadia busiesses. The Cost-Plus Pla year is from Jauary 1 to December 31. Time ad Dollar Limits There are some restrictios o what may be paid uder the Cost-Plus Pla. The specified aual pla dollar liability limit committed by the physicia for each employee with the Cost- Plus Pla is a omial accout ad is forfeited at December 31 (i.e., it caot be rolled over to the ext year or take i cash). However, expeses icurred i a pla year may be claimed up util the ed of the followig caledar year, subject to the limits allocated to each employee i the year the expese was icurred. If medical expeses exceed the specified aual pla dollar liability limit, they may be carried forward for oe caledar year oly, ad paid from the followig year s specified allocatio limit. If after you begi participatig i the Cost-Plus Pla, you wish to make chages to the Cost-Plus Pla aual dollar liability limit, the a ew Participatio Agreemet, ad if applicable, a ew Employee Participatio Form must be completed ad retured to the Fud. A chage to the aual dollar liability limit may be made at ay time durig the 12-moth period November 1 to October 31, but the chage will ot take effect util the followig Jauary 1st. If you choose to eroll i the Core Pla oly, you may later eroll i the Cost-Plus Pla by completig ad submittig a ew Participatio Agreemet to ADIUM betwee September 1 ad October 31 of ay year. 6 AMA Health Beefits Trust Fud Cost-Plus Pla Please ote these guidelies may chage i the future.
Employer otice to Employees The Isurace Act of Alberta requires a physicia employer or a professioal corporatio that is providig eligible health ad detal beefits to employees through the Cost-Plus Pla to provide a writte disclosure to those employees that these beefits are ot provided by or through a isurer. The fiacial obligatio for providig these beefits to employees is solely that of the physicia employer or professioal corporatio to be paid from its et icome or retaied earigs. If you provide your employees beefits uder the Cost-Plus Pla, please make sure that your preset ad future employees are give the otificatio required by the Isurace Act. Please cosult your tax advisor for further iformatio. Eligible Health Expeses Uder Caada Reveue Agecy (CRA) guidelies, expeses eligible for reimbursemet uder the Cost-Plus Pla are detailed o the Caada Reveue Agecy website at this lik (http://www.cra-arc.gc.ca/tx/dvdls/tpcs/cm-tx/rtr/cmpltg/ ddcts/ls300-350/330/llwbl-eg.html). This publicatio ca be viewed by searchig the Forms ad Publicatios sectio of CRA s website (http://www.cra-arc.gc.ca). Eligible expeses iclude, but are ot limited to: Participat portio of co-isurace (i.e., amouts ot covered by Alberta Blue Cross) ad exceeded maximums for ay expeses covered by the Core Pla Health care practitioer fees (physicias ad surgeos, detists, psychologists, chiropractors, aturopaths, acupucturists, etc.) Medical facilities, artificial limbs, aids ad other devices ad equipmet Trasportatio ad travel expeses of patiet ad accompayig idividual Eyeglasses prescribed by a medical practitioer or optometrist, cotact leses Reovatios ad alteratios to a dwellig for a idividual who lacks ormal physical developmet or who has a severe ad prologed impairmet Ieligible expeses iclude, but are ot limited to: Expeses that have bee reimbursed through the Core Pla or aother isurace pla, or that have already bee claimed as a persoal medical expese tax credit No-prescriptio drugs, ad over-the-couter drugs obtaied without a prescriptio Vitamis (except Vitami B12 ad liver extract for pericious aaemia that are prescribed by a medical practitioer) Expeses icurred for purely cosmetic procedures. This geerally icludes surgical ad o-surgical procedures purely aimed at ehacig oe s appearace such as liposuctio, hair replacemet procedures, botulium toxi ijectios, ad teeth whiteig. Fitess classes, fitess club memberships, persoal traier, purchase of home exercise equipmet Expeses icurred prior to erollmet i the Cost-Plus Pla Where GST is charged o a eligible expese, the GST will also be deductible subject to the overall deductio limits described o pages 8 10 Special Note regardig Massage Therapy Expeses Certai other private health services plas ad the Caadia Life ad Health Isurace Associatio (a isurace idustry associatio) allow massage therapy to be claimed uder the Cost-Plus Pla o the basis that: 1) certai provices (excludig Alberta) iclude massage therapy as a regulated health professio; 2) Caada Reveue Agecy s view that a private health services pla ca oly cover for medical expeses which are eligible for Medical Expese Tax Credit is too restrictive; ad 3) massage therapy, whe used to deal with recovery from illess or ijury, should qualify i Alberta. Massage therapy expeses may be submitted to the Fud for reimbursemet. However, you may wish to cosult your tax advisor o the issue relatig to the eligibility of massage therapy expeses for icome tax purposes prior to submittig such a claim. If you choose to submit a claim for massage therapy expeses, the followig criteria of the Fud must be followed: 1. 2. 3. The massage therapist must be a Registered Massage Therapist; The purpose of the massage therapy must be to recover from a illess or ijury ad the massage therapy must be prescribed by a medical practitioer (please refer to the Caada Reveue Agecy website for a curret list of authorized medical practitioers for Alberta http://www.cra-arc.gc.ca/tx/dvdls/tpcs/cm-tx/rtr/ cmpltg/ddcts/ls300-350/330/ampp-eg.html); ad The origial receipt for the expese, together with the prescriptio, must be kept with your records ad provided to the Fud upo request. AMA Health Beefits Trust Fud Cost Plus Pla 7
Tax Implicatios for AMA Health Beefits Trust Physicias are strogly advised to discuss all tax implicatios with their accoutats ad/or tax advisors prior to erollig i the AMA Health Beefits Trust Fud. The Caada Reveue Agecy ( CRA ) has issued admiistrative statemets idicatig that i its view sole proprietors without ay full-time employees are ot eligible to participate i private health services plas ( PHSP ) such as the Cost-Plus Pla. The CRA s admiistrative positio cotradicts the stated policy of the provisios of the Icome Tax Act (Caada) eacted to allow sole proprietors to participate i PHSP s. Furthermore, use of PHSP s by sole proprietors is widespread. The CRA has requested amedmets ad guidace from the federal Departmet of Fiace o this issue. Physicias geerally practise medicie either as uicorporated busiesses (proprietors or parterships) or as icorporated etities kow as professioal corporatios. Both Core Pla premiums ad Cost-Plus Pla expeses may be eligible as a busiess expese deductio for both practice structures. The amout of deductio you ca claim for Private Health Services Pla premiums (i.e., Core Pla premiums ad Cost-Plus Pla expeses) depeds o your practice structure ad the provisio of beefits to all full-time arm s-legth employees*. I the followig examples, it is assumed that the Core Pla premium is $1,500/year (family rate) ad $500/year (sigle rate). Uicorporated Physicia With No Arm s-legth Employees* A uicorporated physicia with o arm s-legth employees may deduct the combied cost of the Core Pla premium ad Cost-Plus Pla expeses, to a aual limit of $1,500 for each of the physicia, the physicia s spouse, ad depedets livig i the household who are 18 or older, ad $750 for each of the depedets livig i the house who are uder 18. Example 1 Physicia (45), spouse (43), child (18), child (15), child (12). Deductio limit: Maximum deductio is ($1,500 x 3) + ($750 x 2) = $6,000. If the cost of the Core Pla is $1,500/year, the allowable Cost-Plus Pla liability limit for the physicia s busiess is $4,500. Uicorporated Physicia With Less Tha 50% of Employees at Arm s-legth A uicorporated physicia, whose full-time, arm s-legth employees comprise less tha 50% of the total umber of employees, icludig the physicia, is limited i his deductio to the lesser of: The cost of providig equivalet coverage ; or $1,500 for each adult ad $750 for each child uder age 18. The cost of Equivalet Coverage is the amout that would be paid if the physicia ad his or her depedets were provided with beefits ad coverage idetical to the beefits ad coverage provided to the full time employee who is offered the least amout of beefits ad coverage. This limit is based o beefits ad coverage made available to the employee ad ot the costs paid to provide such beefits ad coverage. If the cost of providig coverage ad beefits to the physicia is higher tha those of providig idetical beefits to the employee due to differeces i family status, the physicia will still be able to deduct the costs paid subject to the $1,500/adult $750/child limits. The cost of equivalet coverage ad the $1,500/adult ad $750/child are limits o the deductibility of amouts paid for beefits ad coverage provided to the physicia ad the physicia s family. These limits do ot force the physicia to offer employees the same beefits ad coverage. Providig the fiacial limits are ot exceeded, coverage ad beefits provided to the physicia ca differ from those offered to employees ad still be deductible. Example 2 Physicia (45), spouse (43), child (18), child (15), child (12). The physicia employs his spouse full-time. Spouse is a boa fide employee ad performs services the physicia would otherwise have to obtai from a arm s legth employee. Deductio limit: Maximum deductio is ($1,500 x 3) + ($750 x 2) = $6,000. If the cost of the Core Pla is $1,500/year, the allowable Cost- Plus Pla liability limit for the physicia s busiess is $4,500. * A qualifyig arm s-legth employee is geerally a full-time employee who is ot coected to the physicia employer by marriage, blood relatioship or adoptio. 8 AMA Health Beefits Trust Fud Tax Implicatios for AMA Health Beefits Trust
Example 3 As i Example 2, except physicia employs oe full-time arm s legth employee, i additio to the spouse, who is sigle. The physicia does ot offer coverage to the arm s legth employee. Deductio limit: Lesser of the cost of providig equivalet coverage to all full-time employees ($0) or $1,500 for each adult ad (0) or $750 for each child ($1,500 x 3) + ($750 x 2) = $6,000. As o coverage is provided to the arm s legth full-time employee, the deductio for the physicia ad the physicia s family members is il. Example 4 As i Example 3, except the arm s-legth employee accepts coverage uder the Core Pla ad Cost Plus Pla beefits of $1,000. Full coverage is available to the employee ad his family. Sice the employee has o spouse or depedets the maximum amout payable i a year for employee beefits is $1,500 ($500 Core Pla ad $1,000 Cost-Plus Pla). This amout is fully paid by the Physicia. Deductio limit: The maximum deductio for the physicia s costs is $6,000. This is the lesser of the cost of equivalet coverage; $6,500 ($1,500 Core Pla ad up to $1000 Cost-Plus Pla beefits for each perso covered) ad the maximum deductio allowed uder the Icome Tax Act for a uicorporated practice with less tha 50% arm s legth employees; $6000 ($1,500/adult $750/child) as calculated i Example 2. The physicia ca also deduct the cost of providig beefits to the employee. Example 5 As i Example 3, except the physicia oly pays 50% of the cost of the Core Pla premiums with the employee (i.e., $250 each). Deductio limit: The maximum deductio for the physicia s costs is $5,750. This is the lesser of the cost of equivalet coverage; $5,750 (50% Core Pla premium ad $1,000 Cost Plus coverage for each perso covered) ad the maximum deductio allowed uder the Icome Tax Act for a uicorporated practice with less tha 50% arm s legth employees; $6,000 ($1,500/adult $750/child) as calculated i Example 2. The physicia ca also deduct the cost of providig beefits to the employee ($1,250). Uicorporated Physicia With 50% or More Employees at Arm s-legth A uicorporated physicia whose arm s-legth employees comprise 50% or more of the total umber of employees, icludig the physicia, is ot limited to the aual $1,500 (adult) ad $750 (child) rule. However, the physicia may geerally oly deduct, for his coverage, a amout equal to the cost of equivalet coverage offered to the arm s-legth employees. The employees cost are also deductible by the busiess. Example 6 Physicia (age 45), spouse (age 43), child (18), child (15), child (12). Physicia employs two arm s-legth employees, both of whom are married with childre. I additio to the Core Pla, the physicia provides a Cost-Plus Pla beefit of $5,000 to himself ad each employee, fully paid for by the physicia. Deductio limit: Due to the fact that the physicia is providig idetical coverage to all employees, the physicia is permitted to deduct the full cost of the Core Pla ad Cost-Plus Pla beefits for himself ad each arm s-legth employee. Example 7 As i Example 6 above, except the physicia does ot offer either arm s-legth employee Cost-Plus Pla beefits i additio to the Core Pla. Deductio limit: The maximum deductio for the physicia s costs is $1,500. This is the same amout as what is available to the arm s legth employees ($1,500 Core Pla beefits). The physicia ca also deduct the cost of providig the Core Pla beefits to the employees. The cost of the Cost-Plus Pla beefits paid by the physicia will ot be deductible. Medical Expese Tax Credit If a physicia icurs eligible expeses i excess of the deductio limits, the excess portio may be icluded as a medical expese i the calculatio of whether ay amout may be claimed by the physicia or his or her spouse as a medical expese tax credit. A physicia will typically receive less favourable tax treatmet where the deductio for the eligible expese is claimed as a medical expese tax credit as opposed to a busiess expese. Because of the may variable circumstaces that exist, physicias are strogly advised to discuss with their accoutats ad/or tax advisors the tax implicatios of erollig i the AMA Health Beefits Trust Fud, the amout of coverage ad the aual deductios available to the physicia or professioal corporatio. AMA Health Beefits Trust Fud Tax Implicatios for AMA Health Beefits Trust 9
Professioal Corporatios The cost of equivalet coverage ad the $1,500/adult, $750/child deductibility limits do ot apply to paymets made by a professioal corporatio to provide beefits ad coverage to the physicia ad his or her family. Such paymets will be deductible as log as they are reasoable, were made for a busiess purpose ad were ot a taxable shareholder s beefit to the physicia. If the professioal corporatio s oly employee is the physicia, the CRA s admiistrative positio allows the professioal corporatio to deduct from its busiess icome the amout of the Core Pla ad Cost-Plus Pla expeses. No taxable shareholder s beefit will be icluded i the physicia s persoal icome as a result of the paymet of such beefits. If the professioal corporatio employs additioal, arm s-legth or o-arm s-legth employees, the cost of providig Core Pla ad Cost-Plus Pla beefits to these employees is also deductible. The admiistrative positio of the CRA is that the $1,500/year (adult) ad $750/year (child) limitatios that apply to uicorporated physicias are presumed to be reasoable. However, amouts i excess of such limits may also be reasoable depedig o the circumstaces. Sice the physicia is typically the sigle most importat asset to the professioal corporatio, it geerally is reasoable to provide greater beefits to the physicia tha to clerical ad other staff. However, beefits ad coverage must be distributed cosistetly to employees based o their status ad cotributio to the icorporated practice ad ot o the basis of their relatioship to the physicia. As with uicorporated physicias, coverage must be offered to all full-time employees i order for the expese to qualify as a busiess deductio. Example 9 Married physicia with three depedet childre. Physicia employs his or her spouse plus two arm s-legth employees. Corporatio provides Core Pla ad $5,000 Cost-Plus Pla beefits to physicia ad Core Pla ad $5,000 Cost-Plus Pla beefit to each arm s-legth employee. Deductio limit: The full cost of providig these beefits is deductible. Example 10 As i Example 9, except physicia does ot offer ay coverage to his two employees. Deductio limit: Due to the fact the physicia is ot offerig coverage to all full-time employees, the cost of providig Core Pla ad Cost-Plus Pla beefits for himself ad his family is geerally presumed by CRA to be a persoal expese ad will ot be deductible. The physicia may also be taxed o the cost of the coverage as a shareholder beefit. For further iformatio o the icome tax implicatios of Private Health Services Plas, refer your professioal advisor to the followig: IT85R2 Health ad Welfare trusts for employees IT339R2 Meaig of Private Health Services Plas Icome Tax Folio S1-F1-C1: Medical Expese Tax Credit Sectio 20.01 of the Icome Tax Act (for uicorporated physicias) Sectio 248 of the Icome Tax Act (for defiitios) I the examples followig, it is assumed that there is a employmet relatioship betwee the physicia shareholder ad the professioal corporatio. Example 8 Married physicia with three depedet childre, o arm s legth employees. Physicia s spouse is employed by the professioal corporatio. Deductio limit: The professioal corporatio ca deduct Core Pla ad Cost-Plus Pla expeses provided they are reasoable. 10 AMA Health Beefits Trust Fud Tax Implicatios for AMA Health Beefits Trust
Tax Advatage The advatage of usig the AMA Health Beefits Trust Fud is to shift the cost of eligible health expeses from a persoally paid after-tax expese to a tax-deductible expese of the physicia s busiess or professioal corporatio. This is because the amout of tax relief available whe the medical expese is claimed as a busiess expese is ot capped by the limits imposed whe medical expeses are claimed as a persoal medical expese tax credit. * Assumed that physicia would ot qualify for the Medical Expese Tax Credit. ** The illustratio, show at right, of tax savigs is based o certai assumptios icludig the effective rate at which the physicia ad the professioal corporatio will be taxed ad the amout of icome eared i the year by the professioal corporatio. The ultimate tax savigs will deped o the particular circumstaces of the physicia ad the professioal corporatio. Cost-Plus Pla example Physicia icurs medical expeses of $1,000 that are ot reimbursable by the Core Pla (e.g. eyeglasses, major detal, co-isurace amouts, etc.) Cost without utilizig Cost-Plus Pla:* Pre-tax icome required: $1,639 Combied provicial/ federal icome tax (top rate): 39% Icome remaiig to pay for medical expeses: $1,000 Cost to busiess usig the Cost-Plus Pla: Cost-Plus Pla claim paid by the busiess: $1,000 Cost-Plus Pla admiistratio fee: $25 Total cost to busiess: $1,025 Total Savigs** $614 How to Eroll Core Pla 1. Each eligible participat to be covered (physicia ad/or employees) eeds to complete a Core Pla Applicatio. 2. The physicia completes the Participatio Agreemet which is a cotract betwee the physicia (or professioal corporatio, if icorporated) ad the AMA Health Beefits Trust Fud. This agreemet ad the Employee Participatio Form specify who is to be covered by the Core Pla ad the Cost-Plus Pla. 3. Pre-authorized mothly paymet is the oly paymet optio for the Core Pla. Complete the Pre-Authorized Mothly Paymet (PAP) form ad attach a VOID cheque for pre-authorized mothly paymets with your authorizatio. 4. Mail the Core Pla Applicatio(s), Participatio Agreemet, PAP form ad, if applicable, Employee Participatio Form to: AMA Health Beefits Trust Fud c/o ADIUM Isurace Services Ic. CMA Alberta House 12230 106 Ave NW Edmoto AB T5N 3Z1 Cost-Plus Pla If the physicia chooses to participate i the Cost-Plus Pla, the the physicia specifies i the Participatio Agreemet the dollar liability limit that will be provided to the physicia ad the eligible employees. If the physicia has eligible employees who will also be participatig i the Cost-Plus Pla, please make sure that the ecessary otice that these beefits are ot provided through a isurer has bee give to those employees (see Employer Notice to Employees, page 7). Erollmet Deadlie A ope erollmet widow will be offered from September 1 to October 31 each year. Applicatios for the Core Pla ad Cost-Plus Pla will oly be accepted durig this period. However, a exceptio will be made for ew AMA members ad members termiatig beefits from aother group isurace pla (proof of termiatio of coverage is required). I these exceptios, a 60-day erollmet widow will come ito effect upo receivig ew member status or date of termiatio from a existig group pla. Covered physicias who hire ew full-time employees throughout the year may add the ew employee to the pla, effective the first day of the moth followig the first three moths of completed employmet. Applicatio to the Fud must be received withi 31 days of the eligible effective date. (e.g., A employee starts work o Jue 5; first three moths employmet complete September 5. Eligible effective date October 1. Applicatio must be received by November 1.) AMA Health Beefits Trust Fud Tax Implicatios for AMA Health Beefits Trust 11
Coverage Details Whe Coverage Begis Coverage for the Core Pla ad Cost-Plus Pla will begi o the first day of the moth followig the date your applicatio is received ad approved by the AMA Health Beefits Trust Fud. Participat Coverage Chages Notify the AMA Health Beefits Trust Fud of ay chages i coverage status usig the Core Pla Beefit Chage form provided by ADIUM Isurace Services. Chages may iclude ame, address, marital or parter status ad additio or deletio of depedets. Notificatios for chage must be received withi 31 days of the date of chage. Termiatio Coverage termiates at the earlier of: The date you cease to be a member of the AMA or NWTMA The date ay covered employees cease to be eligible employees First of the moth coicidet with or followig the date that termiatio of pla coverage is requested Failure to pay premiums Termiatio of the AMA Health Beefits Trust Fud Should a participat die while coverage is i effect, his/her eligible depedets will remai o the Core Pla for a further 24 moths at o cost, after which coverage will termiate. Claims Process Submittig Claims After erollig i the AMA Health Beefits Trust Fud, you will receive a Core Pla beefits booklet from Alberta Blue Cross ad claim forms to submit for expeses covered by the Core Pla. The package will also cotai a Core Pla Beefit Chage form for future chages i iformatio such as ame, address, marital status or additio/deletio of depedets. Some claims submitted to Alberta Blue Cross will be fully reimbursed by the Core Pla. However, if part or all of the claim is ot reimbursed by the Core Pla, it may the be submitted to the AMA Health Beefits Trust Fud through the Cost-Plus Pla for reimbursemet to the specified liability limit desigated i the Participatio Agreemet. To make a Cost-Plus Pla claim, the physicia or the professioal corporatio will complete a Cost-Plus Pla Claim Form ad mail it to the Fud. The claim will iclude ay eligible medical expeses icurred by the participat (physicia or employee) or his depedets, plus a admiistratio fee of $25. After adjudicatio by the Fud, the approved claim amout will be electroically withdraw from the bak accout that is set-up for Core Pla premiums. Physicias may provide a cheque ilieu of electroic trasfer. The Fud the reimburses the amout of the eligible expese to the participat. The total expese amout ca the be claimed as a tax deductio by the physicia or the physicia s corporatio, subject to the limitatios of the Icome Tax Act (please see page 8 for more iformatio ad examples). The participat is required to maitai origial receipts ad statemets for the expeses for four years ad must produce them upo request of the Fud. If properly structured, the physicia may provide beefits to eligible employees ad at the same time obtai beefits for the physicia ad the physicia s family o a tax-effective basis. For admiistrative simplicity ad cost-effectiveess, you may wish to save several receipts ad submit them all o oe Cost-Plus Pla claim. Coordiatio of Beefits If a participat has coverage uder more tha oe beefit pla through a spouse or parter, paymets paymets from the two beefit plas will ot exceed 100% of the total eligible expese. Uder coordiatio of beefits, oe pla will be the primary payor. The primary payor is the pla that covers the claimat as a employee or pla member. The secodary payor is the pla that covers the claimat as a depedet. Claims for depedet childre will be paid first by the pla that covers the employee or pla member whose birthday is earliest i the caledar year (if both parets have coverage). All ecessary claims should first be submitted to the primary payor. If a participat has two plas ad the primary payor caot be determied, a pro-ratio formula is used to determie how much each pla will pay. Be sure to cosult with your professioal tax advisor before sigig the Participatio Agreemet. Please see the Tax Implicatios sectio (pages 8 11) of this brochure for more iformatio. 12 AMA Health Beefits Trust Fud Coverage Details Claims Process
Core Pla Limitatios ad Exclusios A list of exclusios to the Core Pla follows. While ot covered by the Core Pla, eligible health expeses i this list may be claimed, subject to limits uder the Icome Tax Act, through the Cost-Plus Pla of the AMA Health Beefits Trust Fud. Exteded Health Care Limitatios Whe expeses are icurred by Participats, the pla will pay oe hudred percet (100%) of the total charges for beefits uless otherwise idicated, up to the maximum amouts provided for i this cotract subject to: The total liability of the pla to a Participat for expeses icurred will ot exceed the sum of two millio dollars ($2,000,000) i ay policy year. A Participat may select ay public geeral active treatmet or auxiliary Hospital located i Caada to obtai Hospital services uder this cotract, but the Hospital services provided to him or her will be subject to the rules ad regulatios of the Hospital so selected. I the evet of a chage i semi-private room or private room charges, the pla reserves the right to limit its paymet to the charges i force at the time this cotract was issued. If a Participat does ot receive, or is etitled to receive, fuds from a govermet operated program, the the liability of the pla will be limited to the extet of the liability which the pla would have assumed had the Participat received, or bee etitled to receive, fuds uder a govermet operated program. The pla will limit paymet of visits to a maximum of oe (1) visit per caledar day. Exclusios The pla will ot pay for the followig: Services provided by a Govermet Heath Program. Hospital services obtaied by Participats whe hospitalized primarily for bed rest, rest cures, custodial or domiciliary care, or outside Caada. Services of physicias ad surgeos i Caada. Registratio or admissio fee required to be charged by Hospitals. Services ad/or supplies obtaied outside Caada. Detal Limitatios The pla will pay for oly those detal services which are deemed to be ecessary ad adequate. The pla will limit its coverage ad paymets as follows: Limited (recall), limited ew patiet, specific geeral ad specific oral exams are limited to ay oe exam oce i ay twelve (12) moth period per detist for participats 19 years of age ad older ad oce i ay six moth period per detist for participats uder 19 years of age. Radiographs will be covered oly if the service is redered by a detist, certified detal assistat or hygieist. Where the charge i the schedule for a particular service icludes the charge for the diagostic radiograph o other radiograph charges will be covered for the diagosis or treatmet of that coditio. Where there is a charge for radiographs, o other charges for the iterpretatio of radiographs will be covered for the diagosis or treatmet of that coditio. The fee for a examiatio will be covered oly if the service is redered by a detist. The fee for a emergecy service i the schedule will be covered oly if the service is redered by a detist. Removal of carious lesios ad placemet of a dressig for pulp protectio of a tooth crow will be covered as a separate item of service oly i a emergecy situatio where treatmet caot be cotiued at that sittig. I all cases i which the patiet selects a more expesive pla of treatmet tha is customarily provided for ecessary ad adequate treatmet, paymet ad coverage will be based o the lesser fee. Detal services which cost more tha five hudred dollars ($500) require a pre-authorizatio by the pla i writig i the form of a treatmet pla ad such approval will be for a maximum period of oe hudred ad twety (120) days from the date of approval ad ot loger tha thirty (30) days after the date the patiet ceased to be covered by this detal services pla by reaso of termiatio of eligibility ad i ay evet, ot loger tha the term of this detal services pla. Services redered for extesive edodotic or periodotic treatmet will ot be covered uless a treatmet pla ad radiographs are submitted for approval i writig. Detal services are subject to a policy year maximum of six hudred dollars ($600) per Participat. AMA Health Beefits Trust Fud Core Pla Limitatios ad Exclusios 13
Exclusios The pla will ot pay for the followig services: Services with respect to cogeital, developmetal malformatios, cosmetic surgery ad/or detistry for purely cosmetic reasos, icludig but ot limited to cleft palate, maxillary ad madibular malformatios, eamel hypoplasia, fluorosis ad aodotia. Ay procedure started prior to the date the patiet became eligible for such services uder this detal services pla. Prosthodotic services icludig but ot limited to detures, diagostic examiatios, fixed appliaces or devices, crows, bridges, ilays, olays ad lab processed veeers. Orthodotic services icludig but ot limited to diagostic examiatios, appliaces or devices. Experimetal procedures. Fees for failure to keep appoitmets, fees for completio of isurace forms, fees for letters of expertise ad court appearaces, ad fees for istitutioal calls ad office visits. Fees for istructios i detal hygiee ad/or fees for utritioal couselig. Fees for polishig ad fiishig restoratios. Admiistratio of geeral aesthesia, eurolept aalgesia, coscious sedatio icludig but ot limited to ihalatio techique, itraveous sedatio, ad itra muscular drug ijectios. Fees for dispesig drugs ad medicatio, writig prescriptios, ijectio of therapeutic drugs, hyposis ad acupucture. Procedures, appliaces or restoratios to icrease vertical dimesio ad/or restore or maitai occlusio. Such procedures ad appliaces iclude, but are ot limited to occlusal adjustmet, occlusal equilibratio, coroal coverage of teeth for the purpose of periodotal splitig, periodotal appliaces, bruxism appliaces, temporomadibular joit dysfuctio appliaces, myofacial pai sydrome appliaces, services with respect to temporomadibular joit dysfuctios, restoratio of tooth structure loss from attritio ad restoratio for malaligmet of the teeth. Implats ad the surgical procedures ivolved with the placemet or removal of implats ad surgical periodotal procedures ivolved with the maiteace or augmetatio of implat sites. Habit breakig appliaces icludig but ot limited to togue thrustig ad thumb suckig appliaces. Other oral appliaces icludig but ot limited to mouth guards, ight guards ad sleep disorder appliaces. Bleachig of teeth. Duplicate radiographs. Hospital charges for detal services. The replacemet of lost or stole prosthetic appliaces. Spare or duplicate prosthetic appliaces. Detal care which is provided solely for the purpose of improvig appearace whe form ad fuctio of the teeth are satisfactory ad o pathological coditio exists. Out of Provice Emergecy Travel Beefits Limitatios ad Exclusios Alberta Blue Cross may ot accept liability for hospitalizatio ad related services if the travel assistace service is ot cotacted withi 24 hours of admissio. Failure to cotact the travel assistace service may result i the paymet of medical expeses beig deied or delayed. Alberta Blue Cross, i cosultatio with the attedig Health Care Professioal or travel assistace medical service advisor, reserves the right to trasfer the participat to aother hospital or retur the participat to their provice of residece. If a Participat is medically able to retur to their provice of residece ad refuses to comply with the trasfer request, Alberta Blue Cross will be absolved of ay further liability, whether related to the iitial icidet or ot. Alberta Blue Cross will ot pay for services if travel is booked or commeced cotrary to medical advice or if medical attetio is aticipated durig the travel period. Alberta Blue Cross shall have the right to obtai medical iformatio from the Participat s physicia(s) ad may request a assessmet by a idepedet physicia(s) or specialist(s). This coverage is oly available to Participats who are covered by a Caadia provicial govermet health program. Alberta Blue Cross will ot pay for services if expeses are icurred whe the participat could have bee retured to the provice of residece without edagerig their life or health, eve if the treatmet available i their provice of residece could be of lesser quality or if the participat must go o a waitig list for that treatmet. 14 AMA Health Beefits Trust Fud Core Pla Limitatios ad Exclusios
Beefits are ot covered if emergecy medical expeses are icurred i a coutry, regio or city, whe a writte formal otice was issued by the departmet of Foreig Affairs, Trade ad Developmet of the Caadia govermet, or its equivalet, prior to the departure date advisig Caadias to avoid o-essetial travel or avoid all travel to that coutry, regio or city uless the icidet is urelated to the posted warig. Alberta Blue Cross may request proof of departure upo receipt of claim. Claims must be supported by receipts from commercial orgaizatios. Alberta Blue Cross shall ot pay for ay beefit relatig to pregacy or childbirth complicatios, icludig treatmet for the ewbor, if the medical emergecy occurs after the 32d week of gestatio or is a result of the deliberate iducemet of miscarriage. Alberta Blue Cross will ot pay for expeses icurred due to: seekig medical advice, surgery, a secod opiio or treatmet, itetioally or icidetally, eve if the trip is o the medical recommedatio of a Health Care Professioal; or suicide, attempted suicide or self iflicted ijury, whether sae or isae; or abuse of medicatio, toxic substaces, alcohol or the use of o-prescriptio drugs; or drivig a motorized vehicle while impaired by drugs, toxic substaces or a alcohol level of more tha 80 milligrams i 100 millilitres of blood; or commissio of or attempt to commit, directly or idirectly, a crimial act uder legislatio i the area of commissio of the offese; or participatio i a isurrectio, war or act of war (declared or ot), the hostile actio of the armed forces of ay coutry, service i the armed forces, hijackig, terrorism, participatio i ay riot or public cofrotatio, civil commotio, or ay other act of aggressio. Alberta Blue Cross will ot pay for the followig uless prior approval is received from the travel assistace provider ad are subject to the discretio of Alberta Blue Cross: medical evacuatio air ambulace services, or medical evacuatio repatriatio, or family/fried hospital visits, or idetificatio of deceased, or vehicle services, or retur of Depedet childre, or retur of persoal items, or retur of pet(s). Questios Questios about pla coverage may be directed to ADIUM Isurace Services, admiistrators of the AMA Health Beefits Trust Fud at 780.482.0692, or toll-free 1.800.272.9680 ext. 692, or e-mail adium@albertadoctors.org. All forms are available electroically through the AMA web site www.albertadoctors.org/adiumisurace/hbtf. Questios about the tax status of cotributios to the AMA Health Beefits Trust Fud ad the examples i this booklet should be directed to your professioal tax advisor. Oce you have received your Alberta Blue Cross idetificatio card ad booklet for the Core Pla, beefit ad claim questios about the Core Pla should be directed to Alberta Blue Cross: Edmoto 780.498.8000 Calgary 403.234.9666 Toll-free 1.800.661.6995 AMA Health Beefits Trust Fud Questios 15
This brochure is ot a legal documet. It is ot iteded to give legal, tax or accoutig advice, ad should ot be treated as a substitute for specific advice cocerig your idividual situatio. Dedicated to servig Alberta s medical professio. Our specialty is you. 09/14 08/13