HomeMy WebLinkAbout0108.092l\·
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Januarj 9, 1992
THE HONORABLE CITY COUNCIL
Palo Alto, California
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AmcodmenJ.UQ_.PI~J1.J)~u~1l1$J9r the City (lfPalQ AliQ [mDIoyee:; Health Plan and the R€tired
~t:ts Health Plan
Members of the Counct1:
Report iI' Brier
Attached for Council approval are Amendments to the Pfan Doc'Jrnent5 for the City of Palo Alto
Employe\!:s Health Plan and the Retired Err.ployees Health Plan. These additional cost
containment modifications ha .... e previously been approved by Council as pan of the Memorandum
of Agreement with the Service Employees Imernational Union (SEIU), the Memorandum of
Agreement with the Palo Alto Peace Officers Associa~ion (PAPOA), and the Compensation Plan
for Management and Confidential Personnel and Counci! Appointees.
Cgntract Language
The language set forth beTow is cont2.ined tn Article XIV, Section 1 (b) of the SE1U Agreement and
Section 16(b) of the PAPOA Agreement. This language has also been approvec by tlle
International Association of FiTefighters (1AFF) in conjunction with the reop~ner clause, Article
XXI. Section 6, of the LA.FF Memorandum ot AgrcemenL
The City of Palo AIt(, Emp!oyees~ HeaTth Plan shall be modified 10 inc!ude the foIlo'..\ing
provisions to become effective ac, soon as pvss.ible but not before January I, 1991, subject
to agreement of other ernpto)'ce gTOUpS:
(1) Increase in the annual deduC!.ible to) $]00 per individual or $300 per family.
(2) Add the CCN managed care network of preferred provider ho~pttals with benefits.
at 100% of eligible hospitl.l.l charges \v"ithin the managed c<;'Je network, and redULtfon
to 809'" VCR outside the network. For hospitals outside the stale of California or
for treatment in thc case of an emergency, reimburs.em.:-nt of eligibJe 'hospital charges
",in be at 100% eCR.
(3) Incorporate into the Plan Document technical non·substarHive language changes to
clarify definitions., covered items and exclusions. All document modifications. shall
be reviewed wlth the Union (or Assn<:iation) prior to finalization to ensure. no
substanti ... 'e c1l:mge in benefit level.
CMR: 108 :92
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(4) For the Active Employe.:! Plan, eliminate the $250,000 maJor medical benefit
maximum and substitute a comprehemive lifetime benefit maximum of $1,000,000
per person.
Plan Document Changes
The changes to the City of Palo Alto Employees Health Plan Document are set (onh in
Attachment I. Attachment II contains modifications to the Retired Employees Health Plan
Document This includes the addition of the CCN hos.pital netv."ork. documentation of current
hospitalization and surgical pre-certification req'.lirements, anc clarification of the Medicare
Supplement Plan.
Additionally~ we aTe currently working on updating both He<J.1th Plan Documer::ts in their ,entirety
to reflect t.~e non-substantive tedmicallanguage chJ.nges mentioned abo"-'e in hem #3 of the SEIU
and P.t\POA Agreement language. After all three of the bargaining units. have comp!eted their
Ieview~ the revised Plan Documents will be submiHed 10 Council in their entirety for final approval.
Staffrecom:nends that Council approve the attached Amendments to the Plan Documents for both
the City of Palo Alto Employees Health Plan and the Retired Employees Health Plan.
t City Manager
Attachments:
CHR:108:91
ft_"TlemJrnenl to City (Jf Palo Alto Employee:,' Health Plan
Amendment to City of Palo Alto Retirees' Health Plan
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~nACHlnT I
AMENDMENT TO
CITY OF PALO ALTO
E~IPLOYEES' HEALTH PLAN
January 1992
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CHAPTER 2. DEF!"!TlONS
2.1 ANCILlARY HOSPITAL CHARGES
Charges by a hospital for necessary sej"\~ce.~ slJPpUes and rnedidnes u~ed in the treatmeJ'lt
or diagnosis of an illness or injury while the ccvered individual is an admitted bed patient.
2.2 CALENDAR YEAR
Period of one year .commencing Jan:.lary I.
2.3 CO'llFlNEMENT
A continuous stay in. a hospital or hospitals, comalescent nursing home Dr combination
thereof1 due to an mOe-55 or injury diagnmed by a ph~sician. La!er stays shall be deemed
part of the origiJ1aJ confinement unless ther! is a separation of at lea:'.! 90 days between the
discharge from stay in hospital or convalescenl nursing hume and the next admi'ision to a
hospital.
2.4 CONTRAC •. WMJ'IIISTRA TOR
Risk Management Resources. P.O. Box 26904, San Francisco. CA 94126-J
6904, (l!OO) 235-4888, _
2.4.1 PLA"I ADMlNISTRA TOR
CITY OF PALO ALTO c/o PERSON:>EL DEPARTMEl'o'
2.5 COl\'VALESCENT :>URSI:>G HO~lE
A legally operated institution other than ~ nosiJit<ll, prim.3.ri~y engaged in maintaining and
providing s.killed nusing care to patients recovering from an lllness or injury, and which: (1)
is under the resident s.upervislon of a physician or a registered graduate lll!rse; (2) requires
that tlIe :health care of every patient be under the supervision of a physidan and provides
that a physician be available to furr.~sh necessaI)' medical care in emergencies; (3) provides
for nursing s.ervke continuously for Wienty-four hours of every day; (4) pro'lrides facilities
for the fun-time care of five or mre patients.; (5) maintains clinical records on all patients;
and (6) is not an institution or iJ3Tt thereof .... hich is primarily devoted to the care of tbe
aged, OT treatment of alcohol or drug abuse.
CHAPTER 2. DEFIi'\ITIONS 2.]
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2.6 CONVALESCE:-", NURSING HO\IE CARE
Room and board, special treatment roams., rO:.Jline tabo~atof)' '.;.'ork, ph)'~ical. occupational
or speech ther.JPY trea!ment5, oxygen and other gas therapy, drugs, biologicals, and soiutions
(except blood or pbsrna) used while confined, and g+:nc-ra1 nurs.ing rare for confinement in
an extended ",-are facility by transfer fonowing a pe-riod of at least five com.ecutive days of
confine;nem in a hospital.
2.7 DEDUCTIBLE A."IOUJI;T
The first ~ $100 of covered expenses under the Major Med;cal Benefit incurred hI' a
covered indh~duaJ during each calendar year. With je~pect to a!1}' individual co .... ered under
this Plail for Major M,.:J;cal Benefits both ~s an employee and 85 a depe'"!dent during the
same calendar year, one deductible only ~hall apply.
2.8 DEPENDENT
The Legal ~pouse or unm2.rried child or an employee, induding step-chIldren. foster children
and legally adop:ed children.. 510 long a." they are dependent upon the emplcyee for more
than 50% of their support and maintel1ance. fhe following are not dependents:
2.8.1 Spouse following enll')' of a final decree of diss.olution or divorce.
2.8.2 A child age 19 OJ over, unless (a) tJOder age 26 and enrolled on a full-time basis in
an accredited secondary s.chool trade school. college or university ("full-time" is
generany defined as enrolied for 12 or more units); or (b) suffering from a physical
or mental disability which necessitates prirr.ary economic dependence on the
employee and which commenced v/hile covered as <"11 eligible child. Satisfactory
proof of disabIlity must be s.ubmitted to the emyloJ er at least 31 days before
roverage would othCN'ise terminate, and from time to time there-after.
2-2 cln-Of PALO ALTO
CHAPTER 5. S\JM"\t~RY Of B£SEfITS
fRE·CER!JFICATIQN AND SECO:">O SUB.fr!.CAL OP(,'IO:"> REQUIRED IN CRDLB
TO RECEIVE PLAN IlENEFl.IS..fOR·
l. Non-emergency hospital care (includes ph,ysician cbiJ.rges);
2. Elective surge!)' (includes h0Spita! charge~). See Employee Health Plan. Pre
certification BrocbLlie Beekkt for details.
PRE-CERTJfICAnQN NOT REOliiRE FOR.;
1. Emergency Hospital Care;
2. Emergency Surgei)'
See Employees Health Pre-Certification Brochure ~ for details.
BASIC BENEFITS
PreferredProvider H05pi'als Through Community Care l'ietwor. (CCN):
"Ibeo d\l' Of Palo Alt" Employees' Health Plan provides benefits for any hospiUll cbo,en by
~'co~ered member., However, in order to belp employees and the Plan save on the (:ost of
jnedlCaI °care, the Plan make, available tbe CCN Managed care Network of participating
~05pit.alS.oTh" bospitalscontracting with eeN have agr.~d to I"o,;de quality medical
!\1!"ices'!todisco~ted f~
(::CN liQsplta!s are available to employees and cm"ered dependent< throughout California.
1lle Pl:iri will paj' eligible ,bospital cbarges at 100% for services received Cit, a CCN
participating hospital.' Servic:f'~~ at hospitals ol'tside the CCN managed care 1.1etwork \I,'iH be
paid at 80% of usual, cu.stornary and reasonable ch:lIges (VCR). for bo~pltals outside the
Sttte Qt CaEfomia ()r ou~iue t'be ser.1{'e area (within 30 mlle radius of resirlente). or for
"'raLilent in the ea~ of an emergency, digible hospital charges ;.,;l1 be paid 2t 100% VCR.
~OrE: Ple;aS'e' re~er to a separate brochure for a Ii'lt-of CCN ne1worl participating
hospitals.
Ho,pita! Expen;c Benefit
Tn-patient care· per confinement
In Service Area -CCN Hospital
In Service Area -.r-.,'(In-O-:N Hospital
Ou t <>f Semce Area
5-1 CI1Y OF PAW ALTO
100%
800/,-VCR
lOO%UCR
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Maximum -semi-pri\late rooms
Ext~nded Care FacilJt)
Out-patient Care
OLH-patient Surgery
Accidental Injury (72 hours)
Treatment for Shock, Hemorrhage, Acute P{lbor.iI1g
SuppJementa! Accident
Psychiatric Care
(See Major Medical)
M5,!OR MEDICAl. BENEFITS
LIFETIME MAXIMBM
CALENDAR DEDUCTIBLE
IOD days
2 tim'l!5 the unused 100 d~)'.,
100%
)500
~. ot Covered
S25e,0fk8
(Applies to ALL !>L"-lOR MEDICAL COVERED CHARGES)
PER PERSON SIOO S5G
$300 ~ PER FAMILY
PHYSICL4.N'S CHARGE 10090
OUT-PATIENT X-RAY Al'-/D lAB TESTS 100%
PSYCHIATRIC CARE
Lift-time In-patic:nt ~'Iaximum $50.000
Annual Reinstatemi!ni $2,500
O;Jt-patient Maximum 50t;c
per visit $50
per calendar year 50 ,,'isits
Ali Othe r Covered Cha rge 50 809c
Physical therapy, out-patient drugs, elc.
5-2 ern' OF PALO ALTO
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Pregnancy is covered as any ii1ne~s
Vw'eU baby care in or nut of bospilal is not c~)\'ered
:;ee Section 6.5 $1,000,000 p<r p<rson
For full details of the benefits see the Benefl~ & Limi:ations provisions (Chapter.1i. 6, 7 and
8),
5-3 CITY OF PALO ALTO
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CHAPTER 6. DESCRIPTIO:'; OF BE:'<Ef'ITS
6.1 HOSPiTAL CARE -SURGICA.L PF,E·CERTIFICATION REQUIREMENTS
Pre-<eftlfkation reouirements under the Plan have tv.'o objectives: first, the
provision or C(J5.t eff:
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ctive rnedi:::al and surgical services based on patienl knml,:!edge
of first and ~cond opinion diagnostic and treatrr.fnt programs; and second, the
plarming and limitation of in-patient hospital expenses cor.si~tent v.·ith a pmdent
program or recovery.
6.1.1 Pu.rsuant to these objectives, the following cost-containmenl pro"';sions are required
in order to recei"e the indicated surgkal and hospital 1lenefits:
(a) A second surgical opinion at Plan expense for n0o-emergen~ elective surgery,
and
(b) Pre-admis.s.ion cert!fication and contir.ued hospital stay review for aU !1on
emerge-ney in·patien! admJssion to tJ.n acute ::are hospital.
6.1.2 Pre·certificarion provlsion de~ails and ~efinltions are contained in a separate
publication. ~Employee5' Health Plan Pre-Certificotion.., "whkh is aVaJl:able from the
Pe [sonne 1 offk:e.
6.13 The Plan will nol provide any Basic or Major Medical Benefits if the reqillred pre·
certifkation and consultations are not obtained.
For Hospital and Surgical prc<ertJfji.'3~~on call:
He<i1th lnterp.atlonal roil free at
(80G) 448·9976
6.2 BASIC HOSPITAL EXPE\,SE BEI'EFITS
Reasonable charges for the follO,",1ng hospital services cus.ton'arily furnished by the facility,
while a bed patienr and ordered by the attending physician in connection with the diagnosis
and treatment of an illness or injury neces.sitating the confinement and which could not have
been performed prior to admission, are covered 1000/( for the first ]00 days per confinement.
Inpatient care (Room and Board portion;; limiled to the avt:rage semi-private rale.)
Intcnsj.,,'e Care.
Ancillary h05pital expenses, inc!udillg operating and cystoscopic rooms.
6-1 CllY OF PALO ALTO
Outpatient car~, for the treatmer.t of emeigencie5 for illne:.s or within 72 hours of an injury
or for outpatient surg;cal procedures.; treatment of illne!>5-limil~d 10 treatment for ~hock,
bemorrh3ge or aC":.l~e poisoning.
General nursing care.
Diagnostic X-ray .and laboratory and X-ray thuapy expenses authorized by a ph)'!!ician
(including phy!!ician cha;ges.).
Pre~C'riptio~ drugs.
Anes:hetf::s and charges f0r their administration (except physld<l.n charges).
Oxygen fu,d required equipment recommended by a physician.
Ordinary <:2.sts, splints, and dresstngs.
Physiotherapy, electrocardiog:-ams, bas.al tnetaboli"m tests, and pathology (including
pbysic!an cbarges).
Hospital sen.ices and benefits as provided above for olltpatient surgical treatment.
Cost for administration of blood and olher fluids injected into the circulatory system (not
including cost of such tluids).
In addition., t."'c Pbn pro .... ides for extended ,are facilit) S;:f\ikes as explained under
~Defm.itions" (Room and Board portion limited to the average semi·pflvate: rate; bene5ts
provided for t"'/.·o times (he number of uilused days under the 100-day hospitalization
provision above, per confinement).
In·patient and out-palient psychiatric can: or care for treatment of . .<\kohol or Drug Abuse
is not cO\'ered onder the B05~C Benefits (See ~faJor Medical).
6.3 MAJOR MEDICAL BE:>:EFITS
Subje-er to the general limitations of this Plan and ex.r:ept to the extent covered under any
other pro ... ision of this Plan, reasonable charges incurred by a covered indi .... idual for the
follov.ing expenses will be covered in accordance with the percentage of coverage,
deductible amolJnts., and maximums. in the Summary of Benefits.
6-2 CITY Ot' PALO ALTO
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6.4 DEDUCTIBLE AMOUNT
(a) Deduc:ible. The amount shown in the 5llm:nary of Benefits is applied once each
c-a1er.dar year to tbe covered expens.es fOf ead: individual. Any amounts paid by the
plan do not appli toward the dedu(tibl~.
(b) Maximum F~m!ly Deductible. ]f the total deductible met by three or more members.
of the same family reaches t.he "Ma.x;;r.ur:l Famlly Deductible~ 5300 tstS£B tIl any
calendar year, rlO further Q·:ductibles will be iaken for lhat year fOT any members of
We f.nnly.
{c) Carry-o\ler Deductible. Any charge Incurred in the last three months ofa ca!endar year,
and applied to the deductible, is also carried over and applied to the deductlble for the
follo\\r1ng year.
(d) Single Accident Deductible. If two or more covered indi ... r:lduals in the same family
incur covered expenses because of a single accident, only one deductible needs to be
met for these expenses.
6.5 MAXIMUM AMOUNTS
The Coinpreherisi'le "lifetime ma1(imum~ includes all Basic Ho~pital and Major Medical
Benefits paid to a covered indi\liduaI, regardless ofinterruption in coverage, including those
pald under any policy or pian under whicb the cO\ler~d indhidual received benefits through
this employer.
6.6 REINSTATEMENT
At tbe commencement of each calendar year, an amount equal to benefits paid for .:overed
expenses incurred du..-ing the previQus calendar year, shall be reinstated to the lifetime
maximum. This reinstalement amount TIlay nct exceed $1,()')Q per year for Major Medical
Benefits except that the reins:atemem amount may not exceed $2,500 per year fo: in-p::Hient
psy.:hiatric care. In addition, by submitting e~.'fdenc-e of good health satisfactory to the City
at aoy time benefits have exceeded $1,000, the entire maximLim benefit may be restored.
6.7 C'OVERED CHARGES
6.7.1 Inpati::nt care (Room and Board portion limited to average semi-private).
6.'7.2 Intensive care.
6.7.3 Ancillary hospital expenses.
6-3 CITI' OF PALO ALTO
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6.7.4 Outpatient Care.
6.7.5 Nursing care recommended by a pb}siciaf'..
6,7.6 Physician charges (other than hospital visits by a surgeon follov.'ing surgery.)
6.7.7 Diagnostic X-ray and lato~a!ory charges authorized by a physician.
6.7.8 Pre-scription drugs. Drugs or medicines related to treatment afar. illness or injury
\l.'hLCh cannot be oblain~d without 2: written prescription by a phys:cian.
6.7.9 Anesthetics and charges for their administration.
6.7.10 Oxygen and required equipment recommended by a physician.
6.7.11 Radiological service.lio. examinations and treatment
6.7.12 Charge$ fur artificial limbs, eyes and other prm,lhetic devices, b!ood and othe(
fluids injecred ir:to tn' drculatory sys1em (lJnles~ r(;'placed). casts, crutches, or
splint:>., as recommended by a physid.z'.;l 3.lld resul!ing from iljnes~ or injury sustained
while co""ered under this Plan.
6.7.13 Rental of reusable rnedk-al equipmerli for tempor<iory use recommended by a
physician. The (:ost of rental shall not exceed the purchase price of sud·l
equipment
6.7.14 Charges for ground transportation to and from a hospital or other medical facility
for treatment of an illness or an injury considered a medical neee:,::;ity by a
physician.
6.7.15 P~)'ehatric Services. Jn~patient hmpital treatment for p~'{"h;atric care or for
treatm..;:nt of alcohol or drug abuse wi!! be covcied. Lifetime maximum of $.50,000
per covered individual shall 2.pply 10 in~patienL: treatment for psychiatric care.
Benefits for out-patient psycroia:ric services. ind:lding treatment of alcoh:)] or drug
abuse, arc limited to 50% of reasonable expenses after satisfaction of the
d-educlible amount and 50 visits in each calendar year, except while confined in a
hmpital. However. one psychiatric consultation requested by an attending physician
and necessary to determine 'oI.'he:her an illness is functional or organic is covered
at loo%.
6-4 CllYQ}-PALO ALTO
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6.7.16 Jf provided' pursuant to a compensation plan or memDrandum cf agreement
betv.'een the City and a group of employees, phy:.ician charges for one routine
peJvic examination. including Pap smear, per calene'oil.
6.7.17 OJt·patient physkaJ therapy provided by a registered physical tllerapi5t upon
recommendation of a physician.
6.7.i8 Charges in connection ..... i!h organ transplants will be coyered as follows:
(a) if the Recipient of the traruplant is a covered indivrdual, their expenses will be
covered under the normal terms of the Plan .• ~.nj Don Dr's charges in excess Of
their 0'11,,'1:1 Medical Expense Plan coverage ... "ill be cO!1Sidered as eligible expenses
under this Plan. An)' Donor's eApens.es so paid will be considered as part of the
Maximums for the Recipient's benefit'.. Organ tramplant-. wili only be covered is
they are not considered experimental.
(b) if the Donor of the transplant is a coverec! indhidual under this Plan. their expenses
'lWil1 be (onsid~red as eligible, unless. the Recipjem~s Medical Expense Plan pro\~des
(overage. In sucb cases.. any expenses not covered by t1-)e Recipien~~5 Plan will he
considered a.5 eJigLbJe expenses.
6-5 CilY O~' PALO ALTO
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AMENOMENT TO
cny OF PALO ALTO
RETIREES' HEAlTIl PlAN
January' 199Z
AnACIKNl II
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CHAPTER 2. DEflN!TIONS
2.1 ANCIllARY HOSPITAL CHARGES
Charges by a hosph."l fOT neces::;ary services., supplies and medicines used in the trealment
or diagnosis of an illness or injury while the covered individual is. an admitled bed patient.
2.2 CALENDAR YEAR
Period of one year commencing January 1.
2.3 CONFINEMEKr
A continuous stay in a hospital or hospitals, convalescent nursing home or comb[nation
thereof, due to an illness or injury diagnosed by a phy~ician. Later stays shall be deemed
part of the original confmement l.m]~ss there is a sep.a.ration of at !ea.'>! 90 days between tlJe
discharge from stay in hospital or convalescen! nursiflg home and the nc_xt admiss.ion to a
hospital.
2.4 COI'o'TRACT ADMINISTRATOR
Risk Management R~sources, P.O. 80.< 26904, San Frnnci5Co, CA 94126-
(>904, (800) 235-4888.
2.4.1 PlA.'; ADML"'ISTR>" TOR
CITY OF PALO ALTO c/o PERSOi'.'NEL DEPARTMENT
2.5 CONVALESCE1-<'T NURSING HOME
A legally operated institution other than a bos-pita:, primarily engaged in maim:Jining and
providing skilled nurs.ing care to patients reco\'ering from an illness or injury, and whi<:h:
(1) is under Ihe resident supervision of a ph)'~idan or a registered gradua!e nurse; (2)
requires that the health care of every patient be under the supenision of a physici:ln and
provides that a physician be available to fmnisl1 necessary medical care in emergencies; (3)
provides for nursing ser.1ce continuow.ly for rwenty-fC'!Jr hou'!") of every day: (4) provides
faCilities for the full-time care of five or more patients: (5) maintains clir.icaI records on ali
patients; and (6) is not an institution or part thereof which is primarily devoted to the care
of t1:!e ag;::d, or treatment 'Jr alcohol o. drug abuse.
CHAPTER Z. DEf'INITIOl"S Z-I
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CHAYfER S. SCM~l4R\, OF BE:>:EflTS
fRE-CERTIEJC'ATION AND SECOND SCRGICALDI'!1~!QNRJ;QUTRED IN QRDER
TO RECEIVE PLAN BENEFITS FOR'
I. NOfl:--:elncrgency hospital care (includes pbi'~ician charges);
2. F1eC'uve surgeI)' (inc!udes hospital charges}. Se~ Emploj'ee nealL' Plan Pre·
certification Brochure for details.
fRE·CFBTIEJCATIO~ NOT R£QUJRED FOR'
~ Emergency Hospi:al Care;
~. Emergenc')' Surgery
S~e Employees Hea1th Pre-Certification Brochure for detalls.
HASle BEN!;FJTS
rreferredProvide~Hospjtajs ThroughCommu~jty Care Network {CCK):
The City of Palo All0 Emplo)'ees' He.IL' Pla~ provide, benefits for any ho:;pital chosen by
.>co'lr'ered tnembeL HQwever~ in o.rder to help emplo)'ees and the Plan save an the cost of
medical care, the Plan makes available Ihe CCN Managed Care Network of participating
lloipitals.." The hospitals comra"ting with CC'..; have aJreed to proylde quality medical
Seivices ca.,t, disc{}un!ed fee~
CCN hospitals are available 10 employees and covered dependents 1hroughout California.
Tbe Plan will 'pay eligible hospital charges at 100% for services received at a' CCN
participating 'hospital. Services at ho:-pitals outside the C('""N managed care network. v.ri'Ji be
paid at 80o/c of u~ual. cus~omary and reasonable r.harges (VCR). For bospila!s Ol:;tside tho!
State'of California or outside the ser-.ice area (within 3D miTe radius of re~idence)., or for
tieatment ,~n me case of an emergenC)" elig1bk hos.pl1J.] th~rges will be paid at 100% UCR.
:NOTE: Please refer to a separate brochllre for 3 ll~t (If CCN network participating
hospitals.
Hospital Expense Benefit
In·patient care -per confinement
In Ser;ice Area -eeN Hospital
In Se:vice Area -Non-CCN Hospital
but of Service Area
5·1 CIlY Of PALO ALTO
100%
BOo/c VCR
lOO%UCR
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Maximum ~ semi-pdv'l.te rooms
EJctended Care Facility
Out-patient Csre
Out-patient Surgery
AcddentaI Injury (72 hours)
Treatment for Shock, Hemorrh<!£e, Acute Poisonin;
Supplemental Accident
Psychiatrk Care
. (See Major Medical)
MAJQRME.DICAl BE~Efm
UFETI~IE MAXn,\UM
CAlENDAR DEDUCHBLE
2 times the l..!nused 100 days
100%
$500
Not Covered
$250,000
(Applies to AlL MAJOR MEDICAL COVERED CHARGES)
PER PERSON $100
$300 PER FAMILY
PHYSICIAN'S CHARGE 100%
OUTPAllENT X·RA Y AND L4,B TESTS 100%
PSYCHIATRIC CARE
Lfetime In-patient ~faximum $50,000
An.'1ua! Reinstate:nent $2,500
Out-patient Maximllm 50O/C
pei vis.it S50
per calendar ye<:.T 50 visits
All O'.her C"vered Char." 80%
Pbysical therapy, out-pat;ent drugs, etc.
5-2 CITI' OF PALO ALTO
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Other Features·
Pregnan~ is. covered as any mness
Well baby ca~e in or out of hospital is not covered
For full details of the benefits see the Benefit & Limitations provisions (Chaprers 6, 7 and
8).
5-3 CJ1Y Of' PALO ALTO
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CHAPTER 6. DESCRII'TIO:-' Of BESEflTS
~.1 HOSPITAL CARE -SURGICAL PRE·CERTIFlCA110N R2QUJREMENTS
Pre--ce-niflcation requiremen~ \lnder the P1an have two objectives: firs~ the
provision of cos.t effective medkal aDd surgical .servicl!s ba,<;;cd on patient knowledge
of fi..'"St and ,se('..ond opinion <liagnostic a;:.d treatment programs; and 5erond, the
planning and limitation of in-patient fl05pi:al expenses (or.sistem "Nith a prudent
program of recovery.
IS. 1.1 Pursuant to these objectives. the fol;o\'oing ('ost~conta[nment provisions ~e require~
PI order to receive the IDdicatt::d surgical and hospital benefits:
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(a) A second surgical opinion a~ Plan expense for non-emugency elective surgery;
~nd
(b) Pre-admission certification aDd continued hospital stay re'dew for all Don
emierge~cy in-patient admission to an acme ~re hospita1.
Pre-cei.:ificatIon provision details and definitions are ,ontaiIl~d in a separatt:
publicatLon. ~Employees' Health Plan Pre·CerLificai.ion.~ which is available from the
personnel offiC'~. .
The Plan will not provide .ny Basic or Major Medical Benefits if .he required pre
~enification and consultations are not obtained.
(800) 448-997ti
For Hospital and Surgicai pre<ertitic3tion ("aU: J
Hea1ih International toll free at
~=~~
62 BASIC HOSPITAL EXPE:-;SE RE:\EFITS
Reasonable charges fur the follm\'ing hospital ser-.;ces (U51OJl13rily furnished by the fiicility.
while a bed patient and ordered by the attending physician in conne(tion with tl";e diagnosis
and treatment of an illness or injury necessitating the confinement and which cOlJld not have
been performed prior to admission, are covered 100% for the first lOO days per confinement
Inpatient care (Room and Board porti()n~ timited to the average serni·pr~\'at~ rate.)
Intensh'e Care.
Andl1ary hosptt'~J expenses, including operating and cy::.wS(opic rooms.,
6-1 CITY OF PALO ALTO
Outpatient (are, for the treatment of emergencie'i for illne~s or within 72 hours of an injury
or for outpatient surgical procedures.; tre"iment of Uiness !imi:ed to tJe,nmen;: for shock.
tlernorrhage or 3cuie poisoning.
General m.lrsing :are.
Diabnostk X-ray and laboratory and X-ray therapy expenses author;2ed by a physician
(including phY5ician charges).
Pres.cription drugs.
Anesthetics and cbarges for their administration (except phys.iciJ.l1 charge~).
Ox}gen and required equipment recommended by a phY5ician.
Ordinary casts, splir-.rs, and dressings.
Physiotherapy, electrocardiograms, basal metabolism tests, and pathology (indudir.g
pbysician charges).
Hospital ser .... ices and benefits as pro·viOed above fur Oulpa!lem surgical trealme!iL
Cost for administrativn of blood and other C,uids Injected into the circulatory s'ys-tem (not
incl"ding cost of s"ch fluids).
In addition, the Plan pro'. ides fOj extended (are facility services as explained under
"Defm.itions" (Roo"!TI and Board portion limited lO the average semi-private rate; benefits
provided for tv.·o times the number of unu~d chys under tl1e IOO-day hos.pitahz3tion
provisio[] above, per confinemem).
In-patier]'. anJ' out·paticnt psychiatric C2re or care for treatrr:ent of Akohol or Dmg Abuse
is no; cuvered under the Basic Benefits (S:e ~fJ.jor :\1edi<2)f).
6.3 MAJOR MEDICAL BE~EFlTS
Subj~ct to the genera1 limitations of this Plan and except to the extent covered under any
other prQ\1sion of this Plan, rea~nabTe charges incurred by a covered individual for the
fol]o"ing expemes will be coo,.'ered in accordance wi~h the percentage of coverage,
deductible amount~ ~:ld maximum.<; in the SummJry of Benefits.
6-2 CITY Of PALO ALTO
6.4 DEDUCflBi.E AMOV~T
(a) DeductibIe. The amO\.l;1( sJ1O"wn in the Sumrnary of Benefits is appljed (Jj1(.:e each
caiend3.T year to the covered expen:)es for each indiviLlual. Any amounts paid by the
plan do DOt apply toward the deductible.
(b) Maximum Family D~ductilile. If L~e total deductible met by three or !Tiore members
of the same family rea.:hes ine "M,}Xjmum Family Deductible" 5300 in any calendar
year, no funher deductibles will be t<lKen for that year for an)' members of the family.
(c) CarI)'-over DeGu(:tible. Any charge i!1cU ned [n the last three mcnths of a c-a1endar ytar,
and applied 10 the deduclible, is also (.'arried o\'~r and applied to the deductibJe for the
folloYoing year.
(d) Single Accident Deductible. If t .... ·'o or more covered individual; in the same family
incur covered expenses because of a single accident. only one deductible needs to be
met for these expenses.
6.5 MAXIMUM AMOUNTS
The -lifetime ma,ximum" includes all Major Medical Benefits paid to a covered individual.
Tegardless of interruption in co .... erage, including those paid under any policy or plan under
which the covered individual re(:el\ied benefits through this employer.
6,6 REINSTATEMENT
At the commencement of each calendar year, an amount equal 10 benefits paid for covered
expenses incurred during the previous calendar year, shall be reinstated to the l)fetime
maximum. This reinstatement amount may not exceed S 1,000 per year for lv1ajor Medical
Benefits 1C:)'cept that the reins!"tement amount may not exceed $2,500 per year for in'patient
psychiatri..: C3.i'e. In addition, by submining c\-iden.:e of good health s3.thfadory to the City
at any time benefits ha .... 'e exceeded St,OOO, the entire maxirm.Hn benefit may be reslOred.
6.7 COVERED CHARGES
~ .• 7.~ Inpattent care (Room and Board portionlimiled to a\'erage semi-private).
6.72 Intensive care.
~.7.3 Ancillary hospItal e'-penses.
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Ou~p.a!jent Care.
Nursing care recommenrled by a phys.idan.
Physician 'harget (other than hospital vlsits by a surgeon fello'wing surgery.)
Diagnostic X·ray and laboratory chafge~ authorized by a pbysician..
Prescription dnlgs. DrJgs or medicines related 1c :;e.:Hment of an illne.'i-s or injury
which cannot be Gbtaloed without a written prescri?t(on by a phy~kian.
6~7.9 Ancs.th~tic_~ a!"ld charges for their adminjs~ratiof'l_
.~.7,lO Oxygen and required equipment recommenced by a physician.
6.1,11 Radiological service~. examinations and treatment
6.7.i2 Charges for aniflcial jjrnbs. eyes and other prosthetic devices, blood ::.nd other
fluids injected into the circulatory system. (un:es_~ replaced), C35t5, crutches., or
splints, as recommended by a physician ar.d resulting from lIlness or injury sustained
whi1e covered under this Plan.
6.7.13 Rental of reusable medical equipment for lemporary use recommeilded by a
physician. The cost of rental shall not exceed the purchase price of such
equipment.
~ 7.14 Charges for ground transportation to and from a hospilal or other medical facility
for ueatrnent of an iHnes.s. or an injury <:on::iQercd a medica1 necessity by a
physician.
6.7.'15 Psychiatric Services. In·patjem hospital tn:atment for psychiatric ca~e or for
treatment of aicohol or drug abuse will be covered. Lifetime r.1Cl.ximllm of SSO,QOI)
per covered individual skill a;Jply 10 in-p,nient treatment for psychiatric care.
Benefits far out·patient p~)'chiatrk sen.'-ice~. including treatment of akonol or drug
abuse, are Emtted to 50% of reason'J.ble e'pen. ... es after satisfaction of the
deducuoJe amOlJnt and 50 visits in each calendar year, e.xcept whIle confined in a
hospital. However, one psychi3tric consultation reque~ted by.an aaending physician
and nec'o!ss.ary to determine whether an iIIne ... s is functional or orgJ.nic is covered
at 100%.
6-4 CllY OF PALO ALTO
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§.7.l'6 If prQl.rided pursuant to a co.Tlpem.atfon plan or memorandum Df agreeme:H
betv.;een the City and a group of emplo)'ees, physician chz.rges fpr one TOlJtine
pelvic examination, ir.duding Pap smear, per calendar.
fi.7.1~ Out-patient phys.ical therapy prol.:ided by a regis!ered physical therapist npon
recommendation of a physician.
6.7.18 Chcrges in connection with organ transplants will be covered as. follows:
(a) if the Recipient of the transpTant is a covered individual, (heir expemes v.~11 be
co'..-ered under the normal terrm of the Plan. Any Donor's charges in exceSS of
their OW'll Medical Expense Plan coverage will be considered as eliglble expenses
Cinder this. PIal" .... Any Donor~5 expen5tes 50 paid will be cor.sidered as part of tne
Maximums for the Redpient's benefits. Organ transplants will only be covered is
they are not co:tSidered experimental.
(b) if the Donor of the tro:msplant is a covered individuaJ unde-r this Plan, their e.xpeflSes
""ill be considered as eligible. unless the Recipient's Medical E:o;:pense Plan pro\"ides
coverage. In such case.", any expenses not covered by the Redpient's Plan wIll be
considered as ejjgibJe expellses.
6-5 CIIT OF PAW ALTO
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CHAPTER ,. COORDIKATION ~1T1-I OTHER SOURCES Of P-!.YMEl'oj
9.1 EFFECT OF COVERAGE UNDER A."IOTI1ER PLAN
If an indjo,·idual covered under this Pian is also covered unde:r om: or more other pla~o;, the
benefits payable under this Plan .... ill be reduced by the benefit> payoble under all other
plans so that tl:!e total payments under this Plan and all other pI am do not exceed 100% of
cO':le'.red expenses. In no event will the payment under this Plan be Jarger than would bave
been made in 1he absenc~ of these coordination of benefits provisions. Benefits payable
under all other plans indude the bt:nefil.S that would have been payable had a claim been
properly made for them.
9.2 ADDmONAL DEFL"IITIONS
API..A."'J is any labor-management trus.teed plan, union welfare plans, employer organization
group plan.. school plan\ employee benefit organization plart, prepaid group practice, or Blue
Cross or Blue Shield plan, by whatever name tailed, automobile firsty·party medica!
provision, and any coverage reqllired or pro,,;ded by statute, including !lo·fault insurance or
sinul ar provis!ons.
CLAIM DETERMINATION PERIOD means a calendar year or that portion of a calendar
year during which the individual for whom claim is made ha.s been covered under this Plan.
93 EFFECT ON BENEFITS
The benefits of another plan \It.,ill be ignored for the pUI]Joses of determining !.he benefits
under this Pian if the rules ~t forth in the paragraph below would require this Plan to
determine its benefits before such other plan.
For the purposes of the paragraph immediately abO\'e, the TUle~ es.tablishing the order of
benefit determination are:
(I) The benefits of a plan .,.,:hkh does not c(}nt:<.in a provision coordin<:1ting its benefirs ... ,,;itb
those of this Plan.
(2) The benefits of a plan which covers the individual for the claim in question other than
as a dependent shan be determined before tbe benefits of a plan ",:hien eo .... ·ers S!lch
person as a dependent.
In the event a. dependent is excluded from coverage under any other plan because of
the dependent's elig;b,lity for benefits under this PIGn, and the ruks es.tablishing the
order of benefit deter"nination set forth in this-paragraph (2) would have required this
'·1 CiTY Of PALO ALTO
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Plan to dete:mine it .. benefits af:er the benefits of such other plan bad the dependent
been co\'ered unde:: such otb~r plan, then s'U;~h penon will be excluded as. a dependent
under thi'S Plan to the exter:t of b..;-nefit5; provided by tll: other plan. Nevertheless, L~e
type of expen~s covered under such other phtn shall be considered as. covr-red expenses.
(3) The benefits of a plan which co"ers, t'he indi\.'~dual for the claim ~n questton as a
dependen! of a male person shaD be d~terrr;jfled before the benefils of a plan I,.,rnich
rovers such person as a de~nder.t of a female per::.on .
(4) \\'1len a father and {"' .. "lother are legall" separa.ted or diliQrced, the benefits of a plan
whicb covers the indhridual for the claim in que.st;on as a dependent child of Lie mother
shall be determined before the benefits of a pian 'Jonich cO'I.'ers Sl.H:h person as a
dependent chJ1d of the father unless. evidence is submitted showing that the father has
legal custody or joint tegal custody of the d~pendent d:i!d, in ~.'hkh case benefits. shall
be determined as provided in Paragraph (3) above.
(5) Vihen a father and motber are divorced and the other has rem3rned, 1he benefits of a
plan which covers th~ indiviGual for the claim in question as a dependent child of the
natural mother shall be determined before the benefits of a plan which covers such
person as a dependent child of the stepfather or before the benefits of a plan which
covers such person as a dependent child of the natural father unless e\·idence is;
presented shav.ing that tne natural father has legal custody or joint legal cu':.wdy of the
dependent child, in which case this order of benefit determination s.hall be reversed.
(6) Except a<i. limited iT'] the second sentence of Paragraph (2) above, v.'hen the rules above
do not es.tablish an order of determinat:oJ".., the benefits of a plan. which has covered the
individual for the claim rn question for the longer period of ti:ne ~hall be determined
before the benefits of a plan 'which has covered such person the shorter period of time.
When the above provisilJns operate to reduce the total amounts of benefits othernise
payable as to a covered individual under this Plan d~ring any claim determination
period, each benefit that would be payable in the abs.ence of this prO\·lsion s.hall be
reduced oropon:ionately. and such reduced amount shall be dJarged against any
application benefit mwmum of thi5 Plan.
9.4 MEDICARE WTEGRATlO~,
MEDICARE me am Title X\'1T of the Social Security .A.ct of 1965, as amended, induding
botn Pan A and Pan B.
ELIGIBLE FOR MEDICARE means qualified for benefits under Medicare, incl"ding non
qualification due to failure to apply for co,"erage, di.';.cont5nuance of coverage, or failuie to
make any required contnbution.
9-2 CIIT Of PALO ALTO
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MEDtCARE SUPPLEMENT. This Plan i, supplemental to Medicare ... ith respect to any
~\'ered individl)al who ~s etfgfble for Medkare) whelher or not such individual applies for
O! makes use of Medicare coverage, including both Part A 2nd Pan B. No benefits will be
paid un4,er tllis Plan to 3 ,Medicare-eligible individual for eJlpen~es covered under Part B of
~{edicar~ even if the individual does not purd:ase Part B coverage. III no event shall the
combined payments under Medicare and this Plan exceed the amount that would be paid
~nder tb,i$."Plan in the absence of Medicare.
ffi tbe ease at eft) ea. e reEl L:di 4 [dl:lsl eligiflle (or Me elk-efe. HJe "',"eHb t!l!'18er ffiis PleA s},all
be Mly--ffilegf&te<l-wi'fl ;,e"efilS e"cle i Me<!ie<trei""hether sete,ll) p.;~ ~.' ! leeieer. Of fie.).
se--{lUll w/e tHrife beAefits 8 aileble !e the ~ed---indi.-icltlel .. ill flet eHeeea the 8!PB81:1flt
dun .. 'e~!d ~e flare!! I:ll'uier t~i. PleA iR-~seFlee ef? feelieiire. If benefl'-~ provided by
Medicare 10r a particular charge are not reasonably capable of being specifically
determined, reasonable estimates by the contract administr.ltor ~111 be u~ed 10 deiermbe
benefits bereunder.
95 ADJUSTMEt<TS
For purposes of determin!ng the applicabnity of and implementing the terms of the above
provisions of this Plan or any similar provision of another plan. the contract administrator
may release to 07 obtain from any other insurance company or other organiz.ation or
indh-iduaI any information., con(.-ernlng any indj\·idual, which the contract administrator
considers to be necessary for those purposes. ,AJ]y indi-..idual claiming benefits under [his
Plan will furnish to the contract administrator tne informatjon that may be necessary to
implement the above provisions.
9.6 PAYMENT TO THlRD PARTIES
Vr'henever payments which should have been made under this Plan in accordance with the
a'bove provisions ha-ve been made unde:-any other p1ans., the tontra~t aQmlnis~rator \\,111
have the right to pay to any org3.niz.dions making these p;J.yments any amount it determines
!o be warranted in order to ~atisfy the iment ofth~ above prQl.iSlOr1S, a!ld amountS paid in
this. manner wm be considered to be benefit~ p;hd under this Plan and, 10 the extent of
these payments.. the comra.ct administrator and the employer ',Ir. ill be fully discharged from
!iability under this Plan.
9·) cln· Ot· PALO ALTO