2008 Oregon Legislative Update for Providence Health Plan Employers April 2008

In 2007, the State of Oregon passed a new law that significantly impacts many Oregon small employers. Components of this law became effective January 1, 2008, while the rating components became effective April 1, 2008. A summary of the key points is listed below:

• The new legislation mandates that the former SEHI (2-25) and HIPAA (26-50) health insurance markets become one single market for Oregon small employer groups with 2-50 employees.
• The Oregon Insurance Division now regulates and approves health insurance rates for all Oregon small group employers.
• The Oregon Standardized Group Profile Form must be completed by agents or employers and returned to insurance carriers prior to a new or renewing small group quote being issued.
• Premium rating factors and practices will remain very similar to the former SEHI market with a few additional possible rating factors. All Oregon small groups receiving a quote from Providence Health Plan will be rated using the same factors.
• Providence Health Plan will use the following rating factors for all Oregon small employers: 1. employee age, 2. employee family status, 3. group's geographic location, 4. group's expected claims experience. The first three are the same factors used previously for SEHI groups. The last factor is new, but the adjustment is limited to a maximum of +/- 5% of the premium rates.
• The "blending" of these two markets into a single market for health insurance has been done in such a way as to remain revenue neutral overall. However, because the two markets used very different rating methodologies many employers will receive lower than average premium increases and many other employers will receive higher than average renewal increases.

Oregon House Bill 2007 gives same-sex domestic partners the same rights and benefits as spouses. The bill became law in early February 2008 after a temporary injunction was lifted. House Bill 2007 establishes a registration process with the state-sponsored Domestic Partnership Registry where domestic partners may file a Declaration of Domestic Partnership and receive a Certificate of Registered Domestic Partnership. The certificate allows applicants the right to domestic partner benefits. Here is what this law means for your group:

• Providence Health Plan will include coverage for Oregon-registered same-sex domestic partners as part of our base medical coverage contract for groups renewing or issued on or after April 1, 2008.
• Groups may purchase a supplemental domestic partner benefit endorsement if an employer wants to cover other domestic partners (such as domestic partners who are not registered with the state, including opposite gender domestic partners).
• If your group already has a Providence Health Plan domestic partner endorsement, we will continue to issue your contract with the endorsement. If your intention is to cover only same-sex domestic partners who are registered with the state, please contact us. We will remove the supplemental endorsement from your group contract at renewal.

For more information, including access to forms, visit the Department of Human Services, Center for Health Statistics Web site at: http://oregon.gov/DHS

Effective Jan. 1, 2008, Senate Bill 8 requires that health insurance carriers that offer coverage for IVadministered or injected cancer chemotherapy offer equivalent coverage for orally administered anti-cancer medication. To comply with this law, Providence Health Plan will add a self-administered oral chemotherapy benefit to the medial benefit summary. The self-administered oral chemotherapy benefit will follow a three-tier benefit structure:

• $10 copay for generic prescription
• $50 copay for formulary brand name prescription
• $100 copay for non-formulary brand name prescription

If a member has a prescription drug benefit, claims will be processed either at the new self-administered oral chemotherapy benefit or according to the member's prescription drug benefit, whichever provides the lowest out-of-pocket costs for the member. If the member's out-of-pocket costs are lower when he or she uses the medical plan's self-administered oral chemotherapy benefit, the above copays will apply to the annual out-of-pocket maximums on the medical plan. The annual deductible does not apply, unless the member is enrolled on an HSA-qualified High Deductible Health Plan.

If a member does not have a prescription drug benefit, the oral chemotherapy medication will be covered according to the three-tier self-administered oral chemotherapy benefit listed above under the medical plan. Members can use an alternate prescription benefit, if one is available to them. For benefit coverage, chemotherapy medications must be purchased at a participating pharmacy.

If you have any questions about the new State of Oregon legislative requirements or how they will impact your group medical coverage, please call your Providence Health Plan Sales Account Manager directly or a member of our PHP Sales Team at 503-574-6300 or 1-877-245-4077.