IEEE Association Medical Plan Caught in
Part Two of a
By Trudy E. Bell
[For essential introductory background, see Part
One (October 2006) at
Well, the other shoe has dropped.
On 7 November, CIGNA mailed certified letters to all
the participants in IEEE's member group comprehensive health care
insurance plan (available only to U.S. members), which is
underwritten by CIGNA, a global insurance company that has earned an
A- rating from A. M. Best.
The bad news is: Effective 1 January 2007, benefits
will be cut; rates will rise again; and the plan is now closed to
The good news is: The IEEE is dedicating
extraordinary effort to help find new health-insurance options for
members and their families. "The last few years, the IEEE Insurance
Committee has agonized how to preserve the program and protect
members," said James Breeding, a professional risk manager and
Chair of the IEEE Insurance Committee since 2005. "We have gone
to great lengths to find another player to take over the program
from CIGNA, with no success," he noted. At this time CIGNA cannot
close the plan unless the plan group shrinks to fewer than 50
The IEEE has set up a Web site with general
information, as well as a member hotline to broker/administrator
Marsh Affinity Group Services to answer questions and assist members
in deciding the best course of action for their individual family
situations. Marsh has also partnered with Extend Benefits Group,
LLC, a health insurance management company, to help those members
remaining in the Comprehensive HealthCare Plan explore other health
No Sugar Coating
In two charts, CIGNA summarizes the entire dramatic
situation. One compares current coverage with the benefits that will
be in effect as of 1 January (www.ebview.com/pdfgenerator/ViewPdf/IEEE_CDHC/chc_plan_comparison.pdf).
The other elaborates all the benefits effective 1 January for both
in-network and out-of-network physicians (www.ebview.com/pdfgenerator/ViewPdf/IEEE_CDHC/ER_summary.pdf
In summary, the highlights are:
Health Savings Accounts (HSAs) will cease to exist,
although you may continue to pay medical bills with funds you
have accumulated prior to 1 Janaury 2007. After 1 January, you
will no longer be able to make contributions to your HSA, unless
you procure a non-IEEE health care plan that is HSA-qualified.
Moreover, from January onward, CIGNA will be
assessing the financial situation of the plan monthly. It may
re-rate the plan at any time, either if claims paid exceed premiums
collected, or if the number of participants changes by 15 percent.
In other words, premiums may not stay fixed for an entire year, as
they have in the past; indeed, rate hikes could be made retroactive.
"The IEEE Board of Directors recognizes that the
new, high deductible, coupled with an environment in which rates for
the plan could be changing as frequently as monthly, causes the plan
to be of greatly reduced value as a member benefit," the certified
letter read. "Therefore, the Board has decided to no longer
accept applications for new participants in the plan. (bold
emphasis is in the original)" For additional information on the
benefit changes, history of the IEEE Comprehensive HealthCare Plan,
or HIPAA guidelines and how it affects you, please visit
One of the steps taken by the IEEE's committees to
mitigate the impact of CIGNA's mandated changes to coverage is to
amend the eligibility for IEEE's group plan: as of 1 January, it
will exclude the Medicare-eligible. "That sounds harsh, but it's
really doing them a favor so they are not trapped in the plan,"
explained Martin Greubel, Vice President of Marsh Affinity Group
Services, IEEE's insurance broker/administrator. If
Medicare-eligible participants voluntarily leave a health-insurance
plan that coordinates with Medicare, to get a Medicare
Supplement plan they must be underwritten (meaning every participant
had to undergo a thorough review of past medical history and
possible a physical exam) — which may mean higher rates or outright
declination if they have a preexisting condition. But if they leave
involuntarily — such as being excluded from coverage — and have six
months or more of creditable coverage, then an insurance carrier
offering Medicare Supplements must accept them without underwriting.
"The same is true of Medicare Part D for drug reimbursements," Greubel added. "If you exit an a health insurance program through no
fault of your own, you can enroll in Medicare Part D without
monetary penalty or waiting until the next enrollment period."
"The big question on the minds of members who are
still insured by the CIGNA plan is "what happens next?'" said Lynn Koblin, manager of IEEE Member Benefits. IEEE Member Benefits is
monitoring the insurance plan to gauge the best way to meet the
needs of insured members. "Marsh and CIGNA are advising IEEE about
members' phone calls and comments in response to the 2007 plan
changes outlined in the certified letters. IEEE staff are also
receiving member reactions," she said.
"In the first quarter of 2007, the IEEE Insurance
Committee, the Individual Benefits and Services Committee, and the
Executive Committee of the IEEE Board of Directors will be advised
exactly how many members migrated out of the plan, and the status of
those who remain," Koblin continued. "If the committees perceive
that most members will be best served by closing the plan, then IEEE
can accomplish this."
The plan was not immediately terminated by the IEEE,
because some participants may still want the revised
coverage, and the IEEE certainly wants to give all the participants the
opportunity to assess their situation. "Attrition from the plan,
comments from insured members, and the ongoing financial condition
of the plan will all be considered by the Insurance Committee and
the Individual Benefits and Services Committee, who agree that the
priority is to proceed with caution and compassion for all affected
members," she noted.
If the IEEE terminates the plan, then all the insureds
who have had at least 18 months of creditable coverage will be able
to become insured in individual policies available on the market.
Updates to this evolving situation will be posted at
So What Is a Member to Do?
What if you are currently in the CIGNA plan or are
in need of health insurance?
First, thoroughly research the coverage options.
IEEE Member Benefits have set up online resources to allow members
to explore alternative options through online tools at
www.ehealthinsurance.com. Once you feel you have narrowed down
your options to two or three health plan options that seem
appropriate, call Marsh Affinity at +1 800 493 4333 to request a
call from an Extend Benefits representative. (The IEEE has arranged that
individual members can discuss personal situations at no charge and
no obligation with this health insurance specialty company.) Also, be sure
to consult your own personal local insurance agent. Either
Extend Benefits or your local health insurance agent can help you
not only with the final decision but also with the application
To research the cost of medical insurance premiums
for your specific situation, in most cases you can receive a quote
by providing a minimal amount of medical information. One important
fact to remember: when you receive an initial quote for coverage
(prior to filling out an application), you will be quoted the
standard rate for that product; the actual rate you will be offered
may be higher if you have a significant medical history. Or it's
possible you can even be declined coverage. Equally important,
once you are offered a rate for your own policy, an individual or
family cannot be singled out for a future rate action.
Moreover, if one carrier declines you for coverage,
it's likely that other insurers in your state may also. Although
there is no communication between insurance carriers about
applicants, the criteria that carriers use to accept, rerate or
decline are very similar. If you are declined for coverage, an
insurance carrier must provide you with the reason for the
declination. Useful tip: Sometimes, pre-existing health
conditions do not result in declination for all medical coverage;
the carrier may exclude that one specific condition temporarily or
permanently (known in the insurance business as a rider), while
offering full coverage for all other health circumstances.
If you find yourself unable to procure coverage from
the carriers in your state, then find out whether your state has a
state-sponsored health insurance plan, also known as high-risk
pools. In general, but not always, the rates for the state plans
will be more expensive than the health plans offered in the general
market place, or may offer more limited benefits. But don't despair.
Although a state high-risk pool may be your only option at this
time, should your medical condition improve or resolve, then you may possibly qualify for coverage offered by a different
carrier in your state in the future. To explore options for the state-sponsored
health plans, speak with a representative at Extend Benefits or your
local health insurance agent. If you would like to research state
plan options on your own,
www.ieeeinsurance.com will direct you to links to those states
that have a web site devoted to the options offered. Useful tip:
All family members do not need to be on the same policy. It may be
to your financial and coverage advantage to consider obtaining
coverage for healthier family members on one plan, and placing the
difficult-to-insure family member on a separate policy.
For those persons planning to continue CIGNA
coverage with the IEEE Comprehensive HealthCare Plan you may wish to
consider several options for supplementing your coverage. Hospital
Income Plans (HIP) provide cash payable directly to the owner of the
policy in the event of hospitalization, or, in some instances, home
recovery. Consider adding additional disability coverage or
accident-only insurance. These products may help offset the increase
in deductibles and out of pocket expenses. Again, however, each
individual's situation is different, so thoroughly research the
options to determine if they are appropriate.
IEEE Members who are self-employed, but who have
no employees, are generally treated as individuals for health
insurance. A few states, however, do permit groups of one, which
would be guarantee-issue insurance, meaning that no one could be
turned away for medical problems or preexisting conditions (although
premiums may be high). For groups of two or more, an employer can
obtain a group policy which can be either a defined contribution
plan or a guarantee-issue plan, for higher premium. Extend Benefits
is a specialist in small employer group plans, and their advice can
be of assistance to IEEE members owning their own firms.
At the time of this writing, extensive resources
pertaining to the CIGNA insurance program are posted on the
Updates, changes, or deletions to these links may occur in the
future. Members of the IEEE who have personal questions not answered by
this site may call the insurance administrator, Marsh Affinity at +1
800 493 4333 (where they may also request a call from Extend
Benefits), or contact the IEEE Financial Advantage Program department at
Trudy E. Bell, senior editor for IEEE
Spectrum magazine from 1983 to 1997, and the lead writer for
IEEE's millennium book Engineering Tomorrow (with Dave Dooling,
edited by Janie Fouke, IEEE Press 2000), writes frequently for
The Institute, Spectrum and Today's Engineer.