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UFCW LOCAL 1776 and
PARTICIPATING EMPLOYERS HEALTH and WELFARE FUND |
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| Overview of the Program |
Under the Program, you can have earned credits recorded to an account on your
behalf whenever you use
“other prescription drug coverage” to obtain prescription drugs. Earned credits will be recorded to only one account under the Program for you. This single account rule will apply even if both you and your spouse are Fund participants with prescription drug benefits under the Fund. The earned credits recorded to your account for a calendar year may be used to reimburse you for expenses incurred by you in that same calendar year, provided that these expenses are not covered under your medical coverage (for example, deductibles, co-payments or coinsurance or other non-covered health care expenses) and are deductible medical care expenses in accordance with the Internal Revenue Code (or approved by the Internal Revenue Service (IRS) in pronouncements). You will also be reimbursed for any out-of-pocket costs such as co-pays, deductibles or coinsurance amounts that you incur as a result of using “other prescription drug coverage.” Calculation of Earned Credits/ Reimbursement of Out-of-Pocket Costs After you use “other prescription drug coverage” to obtain prescription drugs, you should submit a Prescription Incentive Program claim form to the Fund office. Attach your pharmacy receipts for each prescription filled showing the amount of your out-of-pocket costs and information which will identify the prescription drug. The Fund office will then take the following steps:  reimburse you for your “out-of-pocket” costs for using your “other prescription drug
coverage” and calculate the earned credits to be recorded to your account based on the “net savings’ to
the Fund, as described below.Net Savings The earned credits to be recorded to your account will be a percentage of the “net savings” to the Fund as a result of your use of the “other prescription drug coverage." The Fund’s “net savings” will be determined as follows: 1. The amount it would have cost the Fund to provide you with that prescription drug under the Fund’s plan (the Fund’s cost, less the co-pay and other costs you would have incurred under the Fund’s Prescription Drug Benefits), minus 2. The amount of any “out-of-pocket” costs (co-pays, deductibles, coinsurance) that the Fund reimburses you for using your “other prescription drug coverage.” Your earned credits will be a percentage of the “net savings” to the Fund. If you obtained your prescription drug at a Preferred Pharmacy or under the Fund’s mail order program, the earned credits to your account will be an amount equal to fifty percent (50%) of the “net savings” to the Fund. If you obtained the prescription drug from a Non-Preferred Pharmacy, the earned credits to your account will be an amount equal to forty percent (40%) of the “net savings” to the Fund. See the section titled “Prescription Drug Benefits” for a list of Preferred Pharmacies. Example Assume that you have prescription drug benefits under the Fund. You also has prescription drug coverage provided by your spouse’s employer. You use your spouse's coverage to obtain a prescription drug for himself or herself from a Preferred Pharmacy. Under this other coverage, your spouse incurs a $10 co-pay to obtain the prescription drug. You should submit a claim form to the Fund office along with an itemized receipt showing the amount of the co-pay and information to identify the drug. The Fund office will reimburse you the $10 out-of-pocket expense. The Fund determines that the cost to the Fund to provide that prescription drug to your spouse would have been $50.The Fund office then calculates the “net savings” to the Fund by subtracting (1) the amount of the co-pay that your spouse would have incurred under the Fund’s Prescription Drug Benefit ($5), and (2) the amount of any out-of-pocket costs that the Fund reimburses you for using your “other prescription drug coverage” (in this example, $10). The result ($35) is the amount of the “net savings” to the Fund. Because your spouse used a Preferred Pharmacy to obtain the prescription drug, the earned credits recorded to your account will be an amount equal to 50% of the Fund’s “net savings” ($17.50).This example is illustrated as follows: Calculation of Net Savings Cost of prescription to the Fund $50.00 Less Fund’s co-pay 5.00 $45.00 Less Out-of-pocket reimbursement to you 10.00 Net Savings to Fund from use of other coverage $35.00 Calculation of Earned Credits Net Savings to Fund $35.00 “Preferred Pharmacy” percentage x 50% Earned Credits recorded to Account $17.50 In the above example, if you btained the prescription drug from a Non-Preferred Pharmacy, the earned credits recorded to your account would be $14 (40% of $35). If, as a result of a coordination of benefits provision under the “other prescription drug coverage,” the Fund must pay an amount to a third party insurer, a corresponding adjustment will be made to the earned credits recorded (or to be recorded) to your account under the Program. Using Your Earned Credits The earned credits recorded to your account for any calendar year can be used to reimburse you for medical expenses incurred by you during that same calendar year.These earned credits can be used only for medical expenses that are not reimbursable to you from any other source. After you incur such medical expenses, you should submit a claim form to request reimbursement of these expenses from the earned credits in your account.You will have to certify on the claim form that these medical expenses are not eligible for reimbursement to you or your eligible dependents under any other insurance plan of the Fund, under any other insurance arrangement that covers you or your eligible dependents, or from any other source. You will also have to submit itemized bills to show that the medical expenses were actually incurred by you. Important Limitations All earned credits are recorded to an account with respect to a calendar year, up to a maximum amount of $10,000 in any calendar year. Earned credits in any calendar year can be used to reimburse you for medical expenses incurred only in that same calendar year. You must submit claim forms for earned credits and reimbursements under the Program for a calendar year by June 30 following the end of that year. Any earned credits with respect to a calendar year for which you do not submit a claim form for reimbursement will be forfeited and cannot be carried forward to any subsequent calendar year. Under NO circumstances will any earned credits be redeemable for cash, except as reimbursement for medical expenses in accordance with the rules and regulations of this Program as described in this booklet. Earned credits may not be transferred or sold to any other participant of the Fund. All other rules, regulations and eligibility requirements of the Prescription Drug Benefits under the Fund shall also apply to this Program. Claim Forms and Deadlines Claims forms for calculating earned credits and for reimbursing out-of-pocket costs for using “other prescription drug coverage” must be submitted no later than June 30 following the calendar year in which you use the “other prescription drug coverage.” Also, claims for reimbursement from your account for medical expenses which were incurred in a calendar year must be filed no later than June 30 following that year. |