HomeMy WebLinkAboutKevin Wolf & Associates, LLC - LEOFF Retiree Drug Subsidy Medicare Part D for Employer Plan SponsersKevin Wolf & Associates, LLC
Retiree Drug Subsidy/Medicare Part D for Employer Plan Sponsors
(Less than 50 retirees) — For employers not in a Prescription Drug Plan (PDP)
Services Available from Kevin Wolf & Associates, LLC (KW&A)
Actuarial Attestation for the Retiree Drug Subsidy (RDS)
1. Provided by qualified actuary, Member of the American Academy of Actuaries (MAAA);
2. Gross (Creditable Coverage) and Net (Actuarial Equivalence) testing — the Centers for
Medicare & Medicaid Services (CMS), a federal agency, requires the Plan Sponsor to pass
both these tests to get the subsidy;
a. If the Plan passes the Gross Test, the Plan Sponsor should send Creditable Coverage
notice to Medicare eligible retirees. KW&A will provide a sample Creditable
Coverage notice (or Non -Creditable Coverage notice, if failing the Gross Test) to
the Plan Sponsor.
b. If the Plan passes both tests, then the Plan Sponsor is eligible for the 28% subsidy of
Medicare eligible retiree's drug claims (including co -pays). CMS pays the subsidy.
c. The Plan Sponsor must fill out the RDS application, available at the RDS website:
http://rds.cros.hhs.gov. KW&A can help with the application process.
3. Plan Sponsor should provide KW&A the Needed Data (see page 5, below) prior to 90 days
before the RDS application effective date (e.g. by about 9/30/2021 for January 2022
effective) or 60 days before (about 10/31/202 1), if a 30 day extension is requested by the
Plan Sponsor in the application.
4. KW&A will provide a report showing the results of the Gross and Net Tests and providing
"next steps' in the RDS application process and Creditable or Non -Creditable Coverage
notice.
5. Service Fees — Actuarial Attestation
a. Gross Test only — $1,000 ($1,750 first year) for up to 4 retiree prescription drug
benefit plans
b. Gross & Net Tests — $1,500 renewal ($1,750 first year) for up to 4 retiree drug
benefit plans
c. These fees apply to each RDS application that is filed by the Plan Sponsor with
the RDS application effective for policies ending in 2022.
1 If the Plan Sponsor has more than 100 Medicare -eligible retirees, they should contact KW&A for fee schedule and
available RDS services, agreement terms, needed data, and service fees for KW&A to provide the services.
3047 N Lincoln Avenue, Suite 400, Chicago, IL 60657 Phone: 773-575-2128 Fax: 773-404-5837
E -Mail: kevin.wolf.associates@gmail.com
;kcag5
Kevin Wolf & Associates, LLC
Interim and/or Reconciliation Payment Reporting
1. The Plan Sponsor must submit summarized claim information in the format that CMS
requires through the electronic application to receive the RDS for Interim or Reconciliation
Payment Reporting.
2. KW&A, after receiving the necessary data from the Plan Sponsor, will give the Plan
Sponsor the needed summary. KW&A will review the data for reasonableness (e.g., test the
claim dates, try to prevent claim duplication). KW&A will not confirm that the claims are
Part D eligible (we expect the claim processor to do that). KW&A will not confirm the
Medicare D eligibility of the retirees whose drug claims are included in the data. We expect
the Plan Sponsor to check retiree eligibility.
3. KW&A will prepare a report with the information that the designated Cost Reporter
(typically, the Account Manager) should submit in the RDS application.
4. We will maintain the data used for the report for six years. This data will be held
confidentially. We will return it to the Plan Sponsor at the Plan Sponsor's request.
5. Service Fees — Interim and/or Reconciliation Payment Report
a. Interim Payment Report: $4,800 for 12 monthly reports, $3,000 for 4 quarterly
reports, $1,500 for one annual report.
b. $2,000 for percent of premium factor development. This is only available for fully
insured employers and before the annual reconciliation report. The reconciliation
report still requires the claim data to be provided to KW&A.
c. Reconciliation Payment Report: $1,500. This report is due up to 15 months after the
end of the application effective year.
d. If desired, we can provide a designated cost reporter. The fee will be $300 for each
report submitted by and KW&A designated Cost Reporter.
e. We recommend that the Payment Requester should be a person working for the Plan
Sponsor. The reconciliation Payment Requestor must be the Plan Sponsor's
Authorized Representative.
Services Not Included in Our Base Fees
We are available by phone and email to answer questions. If the client desires a site visit, we will
bill for that separately, based on the current rate of $300 per hour (minimum $500) plus
travel/accommodation expenses.
We can help the client with any audit by CMS related to an actuarial attestation, interim payment
report, or reconciliation report that we develop. However, the fees provided above do not include
the cost of our providing this audit support. To do this audit support, we will bill at our standard
hourly in effect at the time of the audit. We will provide interim bills at the client's request. If the
client wants a fixed fee in advance of our help with an audit, we will provide that proposal.
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If the client has 500 or more retirees, we will provide a separate proposal with our fees for that
client. We will also need more detailed non -pharmacy claim experience than that requested at the
end of this document.
Definitions of PDP & Retiree Drug Subsidy Application Roles
Prescription Drug Plans (PDP) cover plan sponsor's retirees on an already discounted insured premium
basis under the Medicare Modernization Act of 2003; they aren't eligible for RDS
The Account Manager, Actuary and Authorized Representative must be assigned in the Retiree Drug
Subsidy application process. These roles must be held by different people. Additional people (e.g. Cost
Reporter or Payment Requester) can be designated as the need arises. These roles are defined below.
Account Manager — Typically, a Plan Sponsor employee, who fills out the bulk of the RDS application and
acts as a Cost Reporter (or Payment Requestor, but not both); can assign additional designees; and needs
Plan Sponsor confidential information, like bank account, retiree listing, etc.
Actuary — The Account Manager assigns the Actuary, who provides the actuarial attestation; must be a
qualified Member of the American Academy of Actuaries (MAAA); and cannot be the Cost Reporter or
Payment Requestor.
Authorized Representative — Must be an employee of the Plan Sponsor and must be a Payment Requestor
(especially for the Reconciliation Reporting).
Cost Reporter — Submits Interim and/or Reconciliation Payment Report in the RDS electronic application.
Payment Requester — Requests payment from CMS in the RDS electronic application.
For More Information, where to send the signed agreement and the needed data, please
contact or send the information to:
Kevin S. Wolf, FSA, MAAA
Consulting Actuary
kevin.wolf.associatesggmail.com
Kevin Wolf & Associates, LLC
3047 N Lincoln Avenue, Suite 400
Chicago, IL 60657
Voice: 773-575-2128
Fax: 773-404-5837
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Kevin Wolf & Associates LLC
Retiree Drug Subsidy (Medicare Part D) for Employer Plan Sponsors not in a
Prescription Drug Plan (PDP) & 100 retirees or less2 -Agreement for Services and Fees
Name of Employer Plan Sponsor: City of Pasco
Street Address, Suite/Floor: 525 N 3rd Ave
City, State, Zip: Pasco,WA 99301
Contact's Name: Colleen C'hnnin
Contact's Title: Human Resources Director
Contact's Phone & Fax #: 509-545-3473 Fax* 509-543-5720
Contact's Email Address: chapinc@pasco-wa.gov
Provide billing address if different from the employer group's address.
Select desired services that KW&A will provide:
❑Actuarial Attestation — Gross Test (Creditable Coverage Test) Only. Up to 4 pharmacy benefit plans;
provide item 1 of the data request at least 90 days before effective date; Fee: $1,000.
Actuarial Attestation — Gross (Creditable Coverage) & Net (Actuarial Equivalence) Tests; needed to request
x❑ the Retiree Drug Subsidy (RDS). Up to 4 pharmacy benefit options; provide items 1 — 7 of the data request at
least 90 days before effective date; Fee: $1,500 renewal ($1,750 first year).
Interim Payment Reports for each Plan Sponsor (reduce fees by 40% for Pharmacy Benefit Managers requesting
reports for 4 or more Plan Sponsors); Select one, if desired:
❑ 12 Monthly Reports; Fee $4,800 ($400 billable monthly); Provide 1 & 8 of the data request
4 Quarterly Reports; Fee $3,000 ($750 billable qtrly); Provide 1 & 8 of the data request
F11 Annual Report; Fee $1,500; Provide 1 I & 8 of the data request
❑ Percent of Premium Factor; Need fully insured benefit; Fee $2,000; Provide 1 & 7 of data request
Annual Reconciliation Report for each Plan Sponsor; Select, if desired: ❑ Fee $1,500
Acceptance of above requested services and fees
Name and Title of Accepting Party 3: Dave Zabel]
Employer of Accepting Party: City of Pasgo 16
Signature of Accepting Party: (741
Date:
The actuarial attestations and payment reporting are based in material part upon information and assumptions furnished by the
Employer Plan Sponsor. Accordingly, KW&A shall have no liability for the inaccuracy of these projections to the extent that any
such inaccuracy is based in whole or in part upon the information and assumptions furnished by the Employer Plan Sponsor to
KW&A. For all projects, KW&A's liability is limited to the fees charged.
2 If the Plan Sponsor has more than 100 Medicare -eligible retirees, they should contact LWCA for fee schedule and to
discuss available RDS services, agreement terms, needed data, and service fees for LWCA to provide the services.
3 If the Accepting Party is not an employee of the Employer Group, then provide authorization on the Employer Plan Sponsor's
letterhead that the Accepting Party can approve the work requested.
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Medicare D RDS - Needed Data
For Actuarial Attestation Gross and Net (Actuarial Equivalence) Tests, Needed for getting the
Retiree Drug Subsidy; Provide the information requested in items 1 through 7.
For Actuarial Attestation Gross (Creditable Coverage) Test only; Provide the information in
items 1 and 2.
Interim Payment Reporting using claims: Provide the information requested in items 1 and 9.
Interim Payment Reporting using Percent of Premium: Provide the information requested in
items 1 and 8.
Reconciliation Payment Reporting: Provide the information requested in items 1, 9 and 10.
Attach current and proposed pharmacy and non -pharmacy (latter includes hospital and
physician services) benefit deScriptionS for Medicare eligible retirees. Also, fill in
the benefit names and answer the question in (a) through (d) below:
City of Pasco
a. Option 1 Name: LEOFF 1 Retirees ; is this HMO, PPO, POS, open access or
indemnity coverage?
b. Option 2 Name: ; is this HMO, PPO, POS, open access or
indemnity coverage?
c. Option 3 Name: ; is this HMO, PPO, POS, open access or
indemnity coverage?
d. Option 4 Name: ; is this HMO, PPO, POS, open access or
indemnity coverage?
2. For Pharmacy Benefit Managers providing information for several Plan Sponsors, please
provide the name and location of each Plan Sponsor.
3. Insurance plan year definition for each distinct benefit plan or employee contribution sub-
group (for example: 7/1 through 6/30)
All eligible active employees and LEOFF 1 Retirees.
06/01/2021 - 05/31/2022
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Fill out the following grids for current and proposed contribution rates for each benefit
option (show proposed on an additional page, if needed):
Retiree and Employer Contribution Monthly Rates for Medicare Eligible Retirees
Benefit Option 1: Effective 01 /Q1/21 (a different contribution level is a different benefit option)
Pharmacy Only
(if available) by
Non -Pharmacy Medical
Only (if available) by Total (if not separated) by
Re- Em- Re- Em- Re- I Em -
Category tiree ployer Total tiree ployer Total tiree Toyer Total
Retirees
1459.00 1459.00
Retiree + Spouse
Retirees
Retiree + Children
Retirees
Retiree + Family
Benefit O tion 2: Effective _/_/_
(a different contribution level is a different benefit option)
Pharmacy Only
(if available) by
Non -Pharmacy Medical
Only (if available) by Total (if not separated) by
Category
Re- Em- Re- Em- Re- I Em -
tiree I ployer Total tiree ployer Total tiree ployer Total
Retirees
Re- Em -
tiree ployer. Total
Retirees
Retiree + Spouse
Retiree + Children
Retiree + Family
Retiree + Children
Benefit Option 3: Effective / /
(a different contribution level is a different benefit option)
Pharmacy Only
(if available) by
Non -Pharmacy Medical
Only (if available) by
Total (if not separated) by
Category
Re- Em- Re- Em-
tiree ployerTotal tiree Toyer Total
Re- Em -
tiree ployer. Total
Retirees
Retiree + Spouse
Retiree + Spouse
Retiree + Family
Retiree + Children
Retiree + Family
Benefit Option 4: Effective / /
(a different contribution level is a different benefit option
Pharmacy Only
(if available) by
Non -Pharmacy Medical
Only (if available) by Total (if not separated) by
Category
Re -Em- Re- Em- Re- Em -
tiree Toyer Total tiree ployer Total tiree ployer Total
Retirees
Retiree + Spouse
Retiree + Children
Retiree + Family
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5. Current Contract Counts and Members covered. Please fill in the following grid for each
benefit option:
Number of Medicare Eligible Retirees Contract Counts and Covered Members
as of 05 / 31 / 2021 bv Benefit Option
Option 1 Option 2 Option 3 Option 4
Single contracts 31
Retiree & Spouse
Retiree & Children
Family
Total contracts
Members
6. Claim Experience. Please fill in the following grid for the most recent experience available.
Member months should be counted for each month covered (e.g. if one retiree is covered for 6
months in the experience period, he or she should be counted as 6 member months). If more
detailed claim experience is available (e.g. pharmacy generic vs. brand claims) then attach
separate documents with this information.
Member Months & Claim Experience for Medicare Eligible Retirees
for the Time Period from / / through / /
Benefit Member Months Pharmacy Paid
Option Claims
Non -Pharmacy Paid
Claims
Option 1
Option 2
Option 3
Option 4
7. Please provide the percentage distribution of your Medicare eligible retirees based on the
type of work they did when last employed by the plan sponsor.
Percent Distribution of Retirees by Type of Work
when last em to ed; blank lines should s pecif , the type of work
Private Employer Union S onsor Government Em plover
T e (specify) % Type (specify) % Type (specify) %
Administration Administration n/a Administration n/a
Teacher n/a
Custodial n/a
Police/Fire n/
Total 100% Total 100% Total 100%
4 Contract counts are the count of the units covered (e.g. a family covered would be counted as one contract, regardless of
family size). Members are the count of the Medicare eligible retirees and each covered dependent (spouses and children).
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8. If the Percent of Premium method is being requested, please confirm that each pharmacy
benefit option for Medicare eligible retirees is fully insured and not self-insured. Only fully
insured benefit options can have their RDS developed using the simplified, Percent of
Premium method. This does not require the use of claim experience for the interim payment
reports. However, the Reconciliation must still be developed using claim experience.
a. Option 1 is fully insured: Yes or No
b. Option 2 is fully insured: Yes or No
c. Option 3 is fully insured: Yes or No
d. Option 4 is fully insured: Yes or No
e. If available, provide the administrative and risk charges, included in the premiums
for each benefit option..
9. Provide this claim information as frequently (i.e. monthly, quarterly or annually) as RDS
payments are requested from the CMS on the RDS application. This information should be
in Excel or Access format or a format importable into Excel or Access. This information
should come from the employer group's prescription drug claim payer (such as a Pharmacy
Benefit Manager (PBM), Third Party Administrator (TPA) or insurer).
a. Claim policy year covered is from _/_/ through /_/ Note:
The RDS will only be paid for time periods that the RDS application was approved
for (prior periods in the same policy year approved in the application can be used to
help meet RDS deductible and maximum limits.)
b. Provide the following claim information for each Medicare eligible retiree (we will
not confirm their eligibility) for prescription drug claims incurred from the start of
each policy year through the most recent month available when the data is produced.
Once a policy year is reconciled that time period should no longer be provided.
c. Each prescription drug claim record should include the following data elements:
i. Vendor Name (provider of the claims data)
ii. Employer Group Number
iii. Employer Group Name
iv. Pharmacy Benefit (this should match the labels on the RDS application)
v. Patient's Social Security Number (this will likely be required when the
reconciliation is done, but for interim reports only a unique identifier is
needed; data provider to confirm Medicare eligibility)
vi. Patient's First Name
vii. Patient's Last Name
viii. Date prescription is filled
ix. Date prescription is paid
x. NDC (National Drug Code; 10 -digit 3 segment number)
xi. Drug Name
xii. Prescription Count (typically 1; should be 0 or -1 if adjusting another claim
record)
xiii. Retail vs. Mail Order Code Identifier (e.g. R for retail, M for mail order)
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xiv. Optional: Days Supplied (7, 30 90, etc.)
xv. Optional: Metric Quantity of each pill
xvi. Optional: Average Wholesale Price (AWP)
xvii. Optional (unless needed for deriving the rebates, then mustprovide this
information) Generic/Brand Formulary/Brand Non -Formulary
xviii. Optional: Billed Amount (can be negative for an adjustment to another
claim record)
xix. Paid Amount (can be negative for an adjustment to another claim record)
xx. Co -pay amount (can be negative for an adjustment to another claim record)
xxi. Total Cost = Paid Amount + Co -pay Amount (can be negative for an
adjustment to another claim record)
xxii. Prescription eligible for RDS (Y for yes; N for No). This field means that the
NDC is on the list provided by CMS as covered under Medicare Part D
d. For Interim Payment Reporting, provide rebate and other cost concession
amounts for each policy year time period incurred for Medicare eligible retirees for
each employer group in total dollars or as a percentage of total costs (= paid
amounts + co -pays). For Reconciliation Reporting, provide actual rebates (not
estimated, which is allowed for interim payment reporting) by month for the
Medicare D eligible retirees. The Plan Sponsor can provide the formula to derive
the rebate information, if enough data is given in 8c, above (e.g. specific dollar
amount for each mail order or retail prescription).
e. The claim provider should remove the Medicare Part A and Medicare Part B
eligible pharmacy claims from the claim file provided to KW&A. If these claims
can not be removed by the claim file provider, then KW&A will reduce the claims
by .3% following allowed procedures developed by CMS.
Download the Reconciliation Job Aid from the RDS website at:
http://rds.cms.hhs.gov/reference materials/job aids/job aid recon.htm. Complete steps I through
3 of the Reconciliation Process on. your RDS application fcr the application year being
reconciled. Download the retiree list from the RDS website. Make any corrections to finalize the
retiree list. This is the last chance to correct the retiree list for this application. Download the
final list and send this final list to us. We will use it to make sure the claims (item 9c, above)
match these retirees.
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