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ADMINISTRATIVE INFORMATION/PLAN PROVISIONS – ARIZONA
Eligible Employers
For group medical coverage, employers may participate in
First Health® small employer group program if any person,
firm, corporation, limited liability company, partnership,
association, or political subdivision is actively engaged in
business and, who employs at least two but not more than
fifty eligible employees on a typical business day during
any calendar year.
Companies that are affiliated companies or which are
eligible to file a combined tax return for state tax purposes
will be considered one employer.
In the case of an employer which was not in existence
throughout the preceding calendar year, the determination
of whether an employer is a small or large employer will
be based on the average number of employees that it is
reasonably expected to employ on business days in the
current calendar year.
For Optional Life & Dental coverage, employers may
participate if they employed an average of 2 but no more
that 50 employees on business days during the preceding
calendar year and who employed at least 2 employees on
the first day of the current plan year.
Health Participation Requirements
Employees covered under another health benefit plan may
waive medical coverage and will not be considered as
eligible employees in determining the participation
requirements. Those waiving for other reasons will be
considered eligible employees and will count toward
participation.
For contributory coverage, FHLHIC requires coverage of
at least 75% of all eligible employees. In addition, no
more than 50% of eligible employee’s may waive
coverage.
If the employer elects to pay 100% of the employee’s
premium, all eligible employees must participate.
Health Insurance Plan
Health Insurance Plan or plan means any hospital or
medical policy or certificate, major medical expense
insurance, hospital or medical service plan contract, or
health maintenance organization subscriber contract
which provides benefits consisting of medical care,
provided directly, through insurance or reimbursement, or
otherwise and including items and services paid for
medical care. It includes the entire contract between the
insurer and the insured, including the policy, riders,
endorsements, and the application, if attached. Health
Insurance Plan does not include: accident-only; blanket
accident and sickness; specified disease or hospital
indemnity or other fixed indemnity insurance if offered as
independent non coordinated benefits; credit; limited
scope dental or vision if offered separately; Medicare
supplement if offered as a separate policy; long-term care
if offered separately; disability income insurance; coverage
issued as a supplement to liability or other liability
insurance, including general liability insurance and
automobile liability insurance; coverage designed solely to
provide payments on a per diem, fixed indemnity, or non
expense incurred basis; coverage for Medicare or
Medicaid services pursuant to a contract with state or
federal government; workers’ compensation or similar
insurance; automobile medical payment insurance;
coverage for on-site medical clinics; or other similar
coverage, specified in regulations, under which benefits
for medical care are secondary or incidental to other
insurance benefits.
Note: If Life Insurance is elected, both the Health and Life
participation requirements must be met in order for both
coverages to become effective. See the “Optional Benefit”
sheet for Life Insurance participation requirements.
Employee and Dependent Eligibility are determined by
the Employer
An employee who works on a regular full-time basis for the
Employer and who has a normal work week of 30 hours or
more. The term includes a sole proprietor, a partner, and
an independent contractor, if the sole proprietor, partner,
or independent contractor is included as an employee
under the Employer’s health benefit plan. Eligible
employee does not include an employee who works on a
part-time, temporary, and seasonal or substitute basis.
Eligible dependents of insured employees are defined as
the spouse and unmarried dependent children under the
age of 19. Dependent children also include stepchildren,
legally adopted children or children placed for adoption
and any child for whom a court order requires the
employee to provide health coverage, if they are under the
age of 19. An unmarried child who is a full-time student
between the ages of nineteen and twenty-five and who is
financially dependent upon the parent and an unmarried
child of any age who is medically certified as disabled and
dependent upon the parent.
Late Entrants
If an eligible employee or eligible dependent fails to enroll
within the first 31 days that he or she was first able to
enroll, he or she will be considered a late entrant.
Coverage will become effective on the first of the month
following the date Health Plan Services receives a
completed enrollment form provided that any applicable
waiting period has been satisfied. Coverage, however, will
be subject to an 18-month pre-existing condition limit.
Under certain circumstance, late entrant rules will not
apply if the person waived coverage. See the Certificate
Booklet for additional details.
Coverage Effective Date
Coverage is effective on the first of the month following
any applicable waiting period, unless the firm has prior
group coverage immediately preceding enrollment in this
plan. Coverage in that case will begin on the next day
following the termination date of the prior plan. Health
Plan Services must receive all the necessary information
before coverage can become effective, including fully
ADMINISTRATIVE INFORMATION/PLAN PROVISIONS – ARIZONA
financially liable if it is subject to the Act and it fails to
provide coverage either through the group health plan or
through some other arrangement, such as self-insurance.
For groups with fewer than 15 lives, full maternity
coverage can only be added at time of initial underwriting
or at plan renewal. For groups of more than 15
employees, full maternity coverage may be added
effective the first of the month from the date the coverage
is approved.
completed enrollment forms and a copy of the prior
insurance carrier’s bill.
With respect to Life, AD&D, and Dental coverage,
employees who are not actively-at-work on the effective
date will not become insured until the date they return to
active work on a full time basis and are able to perform all
the normal activities of his or her job. Employees do not
have to be actively-at-work for Medical coverage to
become effective.
COBRA
For businesses employing more than 20 employees,
Federal legislation (COBRA) applies to medical and dental
benefits (if this optional coverage is elected). COBRA
allows insured employees and covered dependents to
continue group coverage after certain qualifying events
occur (like loss of employment, death or divorce) that
would otherwise terminate the group coverage. Coverage
may be continued for up to 18 or 36 months depending on
the specific event, at 102% of the applicable group rate.
See the Certificate Booklet for specific details.
Credit for Previous Deductible
If a firm is covered under another group health plan and it
transfers coverage to First Health®, the cash deductible
charges accumulated under the prior plan by the current
insured employees, during the present calendar year, will
be applied to the new plan’s cash deductible. To obtain
credit, the insured must submit a letter or an Explanation
of Benefit statement from the prior carrier employee with
his or her first claim.
Deductible Carryover (Not applicable to HDHP)
Any expenses used to meet the individual cash deductible
in the last 3 months of the prior calendar year will be
applied to meet the individual cash deductible for the next
calendar year. This also applies to the family deductible.
(Available on selected plans - please contact a Telesales
Representative at (800) 237-4878 for specific plan details.)
State Continuation
For businesses employing less than 20 employees,
continuation under state law is available. See the
Certificate Booklet for specific details.
Coordination of Benefits (COB)
Health care benefits are coordinated with other group or
governmental plans so that the total benefit payable by all
plans does not exceed 100% of expenses, provided that
one or more of the plans would have provided benefits.
Coordination does not include benefits paid by individual
plans.
Medicare
Medicare eligibility does not terminate eligibility under the
plan for active employees or dependents. Benefits,
however, are reduced for Medicare entitled individuals.
For groups with less than 20 employees, the benefits
payable by this plan will be reduced by the amount of
benefits paid or payable by Medicare Part A and B. This
applies whether or not Medicare Part B is applied for.
Charges are calculated at the plan coinsurance, then
reduced by the amount that Medicare pays or would have
paid if the covered person was enrolled in Medicare Parts
A & B.
Usual & Customary Charges (U&C)
For PPO plans, the U&C In-Network Provider charge is
the negotiated rate, capitated fee, per diem rate, case rate
or discounted charge as contracted between First Health ®
or its subcontracted vendor and In-Network and InNetwork Providers.
For employers with more than 20 employees, the group
health plan is the primary payer and it will pay its benefits
without regard to Medicare.
For Indemnity plans and Out-of-Network Providers, the
U&C charges is the lesser of a health care provider’s
actual billed charge or the billed charge adjusted by First
Health’s® current and appropriate fee schedule.
Premium rates may be adjusted accordingly as allowed by
applicable state law.
Medical Underwriting
Evidence of Insurability is not required for group health
coverage. First Health®, however may request this
information in order to set the initial group rate.
Maternity Coverage
The Federal Government’s Pregnancy Discrimination Act
requires employers who have 15 or more employees for
each working day in 20 or more calendar weeks in the
current or preceding calendar year, to cover pregnancy on
the same basis as any other sickness.
For optional coverages, employees and dependents must
submit evidence of insurability that is satisfactory to First
Health® before any optional coverage becomes effective
for that employee or dependent.
If an employer is not subject to this Act (groups with fewer
than 15 employees) the group health plan provides
coverage for complication of pregnancy only.
Establishing Initial Group Rates
The rating guidelines were designed and developed to
promote fairness in the small group marketplace. The rate
charged to a particular employer group will depend upon
Remember: The responsibility for compliance with this
Act rests with the employer. The employer may be held
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ADMINISTRATIVE INFORMATION/PLAN PROVISIONS – ARIZONA
issue date, plan of benefits chosen, location, case size
and industry. It will also depend upon the age, sex, family
composition and health status of the insured employees
and dependents. In addition, rates are adjusted in
accordance with Arizona Laws.
time that lapsed between the plan of creditable coverage
and the enrollment date is less than 63 consecutive days.
12-Month Rate Guarantee
Group rates are guaranteed for the first 12 months
coverage is in force based on applicable rates tables.
Subsequent rate periods are guaranteed for additional 12month intervals. Premium rates will reflect the current rate
structure and the demographics of the group. While the
factor applicable to the health status may be reset at
renewal, any increases will be subject to the limitations of
Arizona State Law.
For optional coverages, premiums may be adjusted upon
a change in dependent status, plan structure or change in
business location. Premiums also will be adjusted on the
first day of an employee’s birth month, should his or her
age change enter the employee into a higher age bracket.
These brackets are 20-29, 30-39, 40-44, and then every 5
years thereafter.
Guaranteed Renewability
Group insurance coverage is guaranteed renewable at the
employer’s option except for:
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Non-payment of premium;
Fraud or misrepresentation by the small employer or
with respect to for individuals insured’s;
Non compliance with carrier’s plan provisions;
The small employer carrier elects to non-renew a
particular plan after providing a 90 day notice and
offering the currently marketed group health plan;
The small employer carrier elects to non-renew all of
its health benefit plans delivered or issued for delivery
to small employer after providing 180 day notice.
Pre-existing Conditions
A health benefit plan shall not deny, exclude or limit
benefits for a covered individual for losses incurred more
than 12 months after the effective date of coverage due to
a pre-existing condition. The plan cannot define a preexisting condition more restrictive than any sickness or
injury (physical or mental) for which medical advice,
diagnosis, care or treatment was recommended or
received by a Covered Person within the 6-month period
ending on the effective date of coverage. Pregnancy and
genetic information that is unrelated to a condition so
diagnosed are not Pre-existing Conditions.
Pre-existing conditions do not apply to a newborn or newly
adopted child under the age of 18 if they enroll for
coverage within 31 days from the date of birth or the date
of placement for adoption.
First Health® will credit the time the Covered Person
covered by the plan of creditable coverage against the
policy’s pre-existing condition limitation if the period of
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ADMINISTRATIVE INFORMATION/PLAN PROVISIONS – ARIZONA
Covered Services
The following is intended to be a general reference and is
not all-inclusive. Actual covered services may vary by
state. Please refer to the Certificate Booklet for
detailed information regarding Covered Services.
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Physician Services include:
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Inpatient and Outpatient Hospital and Skilled
Nursing Care services
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Physician Office visits
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Physician at-home visits
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Second Surgical Opinions
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Services related to Home Health Care, Hospice
Care, and rehabilitative therapy.
Covered Services must be medically necessary, not
experimental or investigational and are subject to a usual
& customary charge limit. Benefits may be subject to
cash deductibles, coinsurance, co-payments and calendar
year and annual lifetime limits.
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Ambulance Service
Back Disorders and Spinal Manipulation
Therapy
Chemotherapy & Radiation Therapy
Dental Services related to Accidental Injury
Diabetic Care
Diagnostic Lab & X-ray Services
Dialysis
Durable Medical Equipment & Prosthetics
Home Health Care
Home Hospice Care
Hospital Services
Human Organ & Tissue Transplants
Mastectomy Coverage
Mental Illness, Alcoholism & Substance Abuse
Inpatient Prescription Drugs.
Outpatient Prescription Drugs either under the
group medical plan or as a Prescription Drug
Card Service
Physician Services
Preventive Health Care
Rehabilitation Therapy
Skilled Nursing Facilities
Treatment of PKU
Treatment of CMJ & TMJ
Cancer Clinical Trials
Inherited Metabolic Disorders
Preventive Health Care includes:
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Immunizations
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Preventive & Primary Care for Children under the
age of 19
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Adult Health Exams
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Routine Physicals
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Pap Smears
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PSA Screenings
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Colorectal Screenings
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Routine Mammograms
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Benefits are limited on some plans. Please refer
to the Certificate Booklet, Schedule of Insurance,
for specific details.
Back Disorders and Spinal Manipulation
Therapy includes:
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Spinal manipulation
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Vertebral alignment
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Spinal adjustment
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Muscle stimulation,
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Ultrasound, diathermy
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Benefits are subject to the plan cash deductible,
co-payment, and co-insurance.
Human Organ & Tissue Transplants includes:
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Medically necessary bone marrow
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Solid human organ transplants
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Donor services
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Benefits are subject to the plan cash deductible,
co-payment, co-insurance
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Benefits are limited up to $100,000 for each
Covered Person during his or her Lifetime.
Hospital Services include:
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Room and board for a semi-private room
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Ancillary Services
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Physician services, including surgery, diagnostic
and therapeutic care
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Drugs, medicines and biologicals
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Anesthesia and the cost of its administration
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Blood transfusions and blood that is not donated
or replaced
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Oxygen and the cost of its administration,
including rental equipment
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General nursing care provided by a RN, LPN or
CNA
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Intensive care, cardiac care and neonatal care
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Medical supplies and equipment
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Operating rooms and related facilities and preand post- operative care
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Ambulatory Surgical Centers
Pre-admission testing
Any other service, treatment or supply normally
billed by a Hospital.
Treatment of CMJ & TMJ:
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Is subject to the plan cash deductible, copayment, coinsurance
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Benefits are limited up to $2,500 for each
Covered Person during his or her Lifetime.
Maternity Coverage
Coverage automatically provides benefits related to
complications of pregnancy.
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ADMINISTRATIVE INFORMATION/PLAN PROVISIONS – ARIZONA
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Full Maternity Coverage (if elected), also provides
coverage for prenatal testing, gynecological, obstetrical,
prenatal and postpartum care, prenatal vitamins, delivery
(including cesarean section), home uterine monitoring and
delivery charges for the birth of a child who is legally
adopted by the Insured Employee.
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Mental Illness, Alcoholism & Substance Abuse
Benefits for medically necessary care and treatment of
Mental Illness, Alcoholism and Substance Abuse include
services and supplies provided by a Hospital or Physician
on an Inpatient or Outpatient basis for:
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Medical and psychiatric evaluations
Room and board and Ancillary Services
Family therapy on an individual or group basis
Drug therapy leading to rehabilitation.
Partial Hospitalization.
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Limitations & Exclusions
The following is intended to be a general reference and is
not all-inclusive. Actual limitations and exclusions may
vary by state. Please refer to the Certificate booklet for
detailed information regarding Covered Services.
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Limitations
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The following covered services may be subject to a per
visit, calendar year or lifetime limit:
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Treatment of Mental Illness, Alcoholism &
Substance Abuse
Diabetic Care
Hospice Care
Private Duty Nursing
Preventive Care
Organ Transplants
Rehabilitative Therapy
Treatment of TMJ
Further Information
This brochure is intended to be a brief description only.
Each insured employee will receive a Certificate Booklet
that describes group coverage in detail.
For a complete listing of covered services, limitations,
exclusions and plan provisions, ask to see a sample
Certificate Booklet or call a First Health® marketing
representative.
The Certificate Booklet will govern any discrepancy
between the information presented here and the
Certificate Booklet.
Exclusions
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Routine Foot Care
Autopsy
Treatment of Infertility & Sperm or Egg
preservation
Orthopedic shoes
Morbid Obesity
Speech Therapy
Treatment of learning disabilities
Orthokeratology Services
Nutritional Supplements
Marital counseling and societal counseling
Surface Electromylogram testing
Herbal or holistic medicine
Cranial prosthesis, wigs, toupees, hair
transplants or prescription medications used in
conjunction with baldness
Charges for a Covered Person’s non-compliance
with Medical Management requirements
Services rendered prior to being covered under
the plan
Charges for services provided after a Covered
Person terminates unless the Covered Person
remains covered through an Explanation of
Benefits
Charges that exceed the Certificates maximum
limits
Charges associated with blood, blood
components or others blood products.
Charges that are not medically necessary, that
are experimental or investigation
Charges that exceed the U&C charge
Custodial Care
Cosmetic Surgery
Personal Convenience items
Medical Care & treatment provided by a covered
person’s relatives
Charges that a covered person has no legal
option to pay
Charges for an injury caused by an accident as
that arises out of or in the course of employment
Charges made for a sickness that is payable by
Workers’ Compensation
Voluntary Sterilization
Transsexual Surgery
Radial Keratotomy
Dental Care or Oral Surgery
Eyeglass, contact lenses & hearing aids
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