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Self-employed Floridians Qualify for Guaranteed-issue Health Coverage during August

7/31/2003

TALLAHASSEE – Self-employed Floridians in need of health insurance can obtain it during an open enrollment period beginning tomorrow and lasting through the month of August, Florida's Chief Financial Officer Tom Gallagher said today.

The open enrollment period, established by the 2000 Legislature, requires insurance companies and Health Maintenance Organizations (HMOs) to offer applications for coverage to the self-employed on a guaranteed-issue basis from August 1 to August 31 each year, with a plan start date of October 1. The open enrollment period is also the time when the self-employed now covered by a small business plan may switch to another company's plan.

"We need to get the word out that the window of opportunity only comes once a year for the self-employed seeking guaranteed-issue health coverage," Gallagher said.

Guaranteed-issue means that insurers and HMOs must offer coverage without regard to health status. While small businesses having only one employee, often referred to as "one-life groups," cannot be refused coverage during the open enrollment period, companies that write coverage for these groups are required to offer only "basic" and "standard" plans.

The basic and standard small business plans are generic or standardized plans. The plans were recently redesigned by a Small Employer Benefit Committee, which was appointed by Gallagher last June. All insurance companies and HMOs that write coverage in the small group market were required to offer the new basic and standard plans beginning in April.

The newly redesigned plans feature adjustments to benefits intended to reduce premium costs, such as raising co-pays for emergency room admissions, physician office visits and prescription drugs, as well as allowing higher deductibles and out-of-pocket maximums.

"Redesigning and expanding the number of health insurance plans available to small businesses and pursuing other market reforms will help employers continue to offer coverage to their employees," said Gallagher.

In a further effort to spur more affordable options, HMOs are for the first time required to offer "co-insurance" type standard and basic plans as an alternative to traditional co-pay type plans. In these insurance-like options, HMOs would pay 60 to 80 percent of typical charges for services, depending on the plan, as opposed to charging co-pays. Employers could choose different out-of-pocket maximums to further adjust premiums.

For the first time, all basic plans are now required to provide prescription drug coverage, and lifetime maximums for basic insurance plans were raised from $500,000 to $2 million. Standard insurance plan lifetime maximums were raised from $1 million to $5 million. HMO standard and basic plans previously carried no lifetime limits but now have the same maximum limits as the insurance plans.

Self-employed Floridians who apply for coverage must show certain documentation verifying that they are operating an active business. For assistance, they should contact the department's toll-free consumer helpline at 1-800-342-2762. Additional details about the options available under the new basic and standard plans can be viewed as appendices to this press release at www.fldfs.com.

Consumers may also contact our helpline to request a free copy of our health insurance consumer guide. Previous releases and a copy of the Small Employer Benefit Committee's report are also available on the department's website.

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