Priority Health Small Group Agreement
PriorityHMO, PriorityPOS, PriorityPOS
THIS AGREEMENT is made and entered into on the date stated on the Group Application (herein referred to as the Effective Date) by and between GROUP, and PRIORITY HEALTH, a Michigan nonprofit corporationand licensed health maintenance organization and PRIORITY HEALTH INSURANCE COMPANY, a Michigan insurance company (collectively, “Health Plan”), with a primary place of business at 1231 East Beltline NE, Grand Rapids, Michigan 49525. Within this Agreement, “Health Plan” refers to the appropriate company listed above depending on the products purchased.
Health Plan and Group agree as follows:
SECTION 1. DEFINITIONS
Capitalized terms in this Agreement shall have the meaning given them in the Evidence of Coverage, Certificate of Coverage or Policy and any riders, addenda, schedules and amendments attached thereto (collectively, the “Plan Documents”) as of the Effective Date of this Agreement. Plan Documents may be found at www.priorityhealth.com or by calling Health Plan’s Customer Service Department. Except as this Agreement provides otherwise, the term “days” shall refer to calendar days.
SECTION 2. TERM AND RENEWAL
The initial term of this Agreement shall commence on the Effective Date. This Agreement shall continue in effect for a period of 12 months and shall automatically renew thereafter for one-year terms, unless terminated pursuant to this Agreement.
SECTION 3. HEALTH PLAN SERVICES
Health Plan shall provide the benefits designated on Group’s rate proposal upon enrollment with Health Plan and as provided for a renewal period (the “Covered Services”). Health Plan shall make a network of Participating or Network Providers available to Members. These Providers will act as independent contractors to render the Covered Services as described in the Plan Documents. Participating Providers are not agents or employees of Health Plan nor is Health Plan an agent or employee of any Participating Provider. Participating Providers are solely responsible for any health services rendered to their Member patients. Health Plan makes no express or implied warranties or representations concerning the qualifications, continued participation, or quality of services of any Participating Provider.
Health Plan has entered into a contract with the Centers for Medicare and Medicaid Services (“CMS”) to provide managed health care and prescription drug services to certain Medicare beneficiaries under Medicare Advantage Prescription Drug (MAPD) or a Medicare Rx Prescription Drug Plan (PDP) program for its employees and their eligible Dependents (the “Plan”). If Group has selected MAPD or a PDP program, the terms and conditions of that Agreement are located in the Group’s Plan for MAPD or PDP; a copy of which can be obtained by contacting Health Plan.
SECTION 4. PREMIUMS
In addition to Premiums owed to Health Plan, Group shall reimburse Health Plan for its payment of any applicable federal, state or local sales or excise tax liability, including, but not limited to the Michigan Insurance Provider Assessment and the Comparative Effectiveness Research Fee imposed on Health Plan under IRC Sections 4375 – 4377 and regulations implementing same, and any other tax or fee that may be imposed upon Health Plan during the term of this Agreement (excluding income or payroll taxes) relating to its administration of the Group’s health plan and/or claims payments arising under this Agreement; provided, however, that Group shall have no responsibility for taxes, fee or assessment based solely on the net income of the Health Plan. The Premiums set forth in the Group’s rate proposal upon enrollment with Health Plan shall be effective for the initial term of this Agreement unless Group requests and Health Plan approves benefit changes during the initial term, in which case Premiums shall be changed accordingly. After the initial term of this Agreement, Health Plan has the right to change the Premiums for each renewal period.
Health Plan will give Group 30 days’ written notice of the change. The notice will state the amount of the new Premiums and the effective date of the change. Payment of the new Premiums by Group will be deemed acceptance by Group of the new Premiums. Health Plan may also change Premiums on the effective date of any change in law or regulation that has a direct and material impact on the cost of providing Coverage to Members upon 30 days’ prior written notice to Group. Payment of the applicable Premium on and after the date of change shall constitute acceptance of those changes by Group.
In the event that the Premiums are changed as provided in this Section 4, Health Plan shall provide Group with a revised rate proposal reflecting those changes. The revised rate proposal shall amend this Agreement and supersede any previous rate proposal for this Agreement.
(a) For Transition Groups (Groups still on pre-PPACA plans) for Coverage of employee and/or their eligible Dependents that is first effective on or before the 15th day of any month or terminated after the 15th day of any month, the entire month’s Premium shall be due to Health Plan for that month. For Coverage of employees and/or their eligible dependent’s that is first effective after the 15th day of any month or terminated on or before the 15th day of any month, no Premium will be due to Health Plan for that month.
(b) For all other groups, employees added or terminated before the end of a month will have that month’s Premium prorated to reflect the number of days they are Covered in that month.
(c) Premium payments are due in full to Health Plan on or before the first day of each month for that month’s Coverage. Payments may be made electronically as instructed by Health Plan or to the address designated by Health Plan. Group is responsible for paying any and all costs and expenses, including reasonable attorney’s fees, incurred by Health Plan in collecting any past due Premiums from Group.
(d) Premium payments to Health Plan are subject to a 30-day grace period (the “Grace Period”), during which time Premiums may be paid to Health Plan without lapse of Coverage. If Premiums are not paid by the end of the Grace Period, Group’s Coverage will, at Health Plan’s discretion, be terminated as of the date for which Premiums were last paid. If Group fails to pay the required Premiums and Coverage is terminated, Members will be responsible for the costs of all Covered Services received by them after the termination date. Acceptance of late, partial or non-electronic payments by Health Plan shall not constitute a waiver of any present or future rights Health Plan would otherwise have under this Agreement.
(e) Group is responsible for reviewing Group’s monthly billing invoices and for notifying Health Plan of any corrections within 30 calendar days after the date of each invoice. Failure to promptly notify Health Plan of changes may limit Premium adjustments.
SECTION 5. ELIGIBILITY AND ENROLLMENT
See the Plan Documents for eligibility requirements and enrollment procedures applicable to Subscribers and Covered Dependents. Any exceptions to standard eligibility and enrollment procedures applicable to Group must be documented on the electronic sales quoting tool or paper Application (whichever is applicable) upon either enrollment with Health Plan or for a renewal period. Any revised eligibility and enrollment procedures shall amend this Agreement and supersede any previous eligibility and enrollment procedures for this Agreement.
Domestic Partner: Group must define “Domestic Partners” as it relate to its benefits plan and must define the terms and conditions under which the Employer will permit Coverage of Domestic Partners. Covered Dependents who are the Domestic Partner of the Subscriber are eligible to enroll as defined by and under conditions allowed by the Employer.
(i) Domestic Partners of eligible employees are not eligible to enroll in special enrollment periods.
(A) Eligibility for COBRA Coverage is only extended to the spouse and dependent children of a Subscriber.
(B) Domestic Partners and the Dependent children of the Domestic Partner are not eligible for COBRA Coverage.
(C) Continuation of Coverage does not apply to Domestic Partners or to the Dependent children of the Subscriber’s Domestic Partner.
(ii) Subscribers who reside out of state will be required to follow the States Domestic Partner law in which they reside.
(A) If the State allows Domestic Partners, the Subscriber will be required to request a Domestic Partner Certificate.
(B) If the State does not allow Domestic Partners, the Subscriber will be required to complete the Health Plan Domestic Partner Affidavit Member Form.
(iii) The Subscriber must notify the Employer and Health Plan of any change in the status that would make the Domestic Partner (or his/her Dependents) no longer eligible for Coverage. Such notice must be given within 30 days of the change in status.
(a) Health Plan shall provide Group with a supply of its forms and descriptive literature for distribution to any employee who becomes eligible for Coverage. Group shall give Health Plan's forms and descriptive literature to any employee who becomes eligible for Coverage. Group shall forward all applicable forms and other information that it receives from employees to Health Plan within 10 business days of receipt from any employee. Health Plan shall provide each Member with an identification card, with Health Plan's address and telephone number, as evidence of enrollment, and information necessary for Members to understand and use the Covered Services to be provided under this Agreement.
(b) Group shall permit eligible employees and their eligible Dependents to enroll for Coverage during an annual open enrollment period or within 31 days from the date the employees and their Dependents become eligible for Coverage. The open enrollment period shall be held once per year as agreed by Group and Health Plan and shall be consistent with the open enrollment period applicable to any other Group health benefit plan being offered by Group. Newly hired employees and their Dependents are eligible to enroll after expiration of the waiting period as documented on the electronic sales quoting tool or paper Application (whichever is applicable) upon either enrollment with Health Plan or for a renewal period. Health Plan will meet with employees during the open enrollment period at the request of Group.
(c) Except as provided below in this subsection 5(c) or as otherwise required by law, Coverage for eligible employees and Dependents shall become effective on the first day they become eligible provided they enroll within 31 days of first becoming eligible. If eligible employees and Dependents do not enroll within 31 days after first becoming eligible, they may not enroll until the next open enrollment period.
(i) Employees who decline enrollment for themselves or their Dependent(s) (including the employee’s spouse) because they have other health insurance Coverage and subsequently lose that Coverage may enroll themselves and their dependent(s) during a special enrollment period, provided they request enrollment within 31 days after their other Coverage ends. The employees and their eligible Dependents must provide proof of the loss of the other Coverage that is acceptable to Health Plan. Such Coverage will be effective on the day after the other Coverage ends.
(ii) An employee or Dependent is eligible for this special enrollment period as follows:
(A) if the other Coverage was continuation Coverage pursuant to the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”), the other Coverage must have been exhausted.
(B) if the other Coverage was not COBRA continuation Coverage, the other Coverage must have terminated because of loss of eligibility or because the other employer stopped making premium contributions.
(C) for any other reason permitted under state or federal law.
(iii) An employee or Dependent is not eligible for this special enrollment period if the loss of eligibility is due to a failure to pay Premiums on a timely basis or if the employee was terminated for cause, including making a fraudulent claim or intentional misrepresentation of a material fact in connection with the coverage.
(iv) An employee or Dependent is not eligible for this special enrollment period for a loss of eligibility due to the employee’s voluntary termination of coverage if the termination of Coverage is because of a change in cost or benefits. An employee or dependent is eligible for this special enrollment period when the voluntary termination occurs in connection with a Section 125 plan election or during the open enrollment period of the plan for which eligibility was lost.
(v) Eligible employees, whether enrolled in Health Plan or not, who gain a new Dependent as a result of marriage, birth, adoption, or placement for adoption, may enroll themselves, their spouse and their eligible Dependents without waiting for the next open enrollment period, provided that they submit enrollment forms to Group within 31 days after the marriage, birth, adoption, or placement for adoption.
(vi) If eligible, Coverage will be effective on the date of the marriage, birth, adoption, or placement for adoption.
(d) Group shall offer eligible employees Coverage under this Agreement on terms no less favorable than those on which it offers any other health benefits plan. Group agrees to make no attempt, whether through differential Group premium contributions or otherwise, to encourage or discourage Coverage of employees and their eligible Dependents under this Agreement. If Group contributions to Coverage under any other health benefits plan are increased during the term of this Agreement, Group agrees to make a similar change in its contribution rate to Coverage under this Agreement.
(e) Group shall notify Health Plan of an employee’s loss of eligibility within 30 days following such employee’s loss of eligibility. By notifying Health Plan of an employee’s loss of eligibility, Group acknowledges that it has informed such employee of his/her loss of eligibility at the time the loss occurred. Group’s failure to provide such notification may limit premium refund.
(f) Health Plan may grant retroactive premium credit for enrollment changes that are effective more than 30 days before Health Plan received notification of the change if the Group certifies to Health Plan that Group notified the affected employee as the time of loss of eligibility. This provision is intended to comply with the Patient Protection and Affordable Care Act regarding rescissions, as amended and pursuant to regulations promulgated there under (collectively, “ACA”).
(g) Group shall be responsible for compliance with all notice requirements including, but not limited to, notices that are the obligation of Group under ACA, COBRA, ERISA, and the Health Insurance Portability and Accountability Act (“HIPAA”), and any amendments thereto.
(h) As between Health Plan and Group, Group is responsible for complying with the terms of this Section 5 even if Group has contracted with a third-party administrator to administer Group’s enrollment functions.
(i) Health plan will prepare the Summary of Benefits & Coverage documents (the “SBC”) as required by ACA. Group will be responsible for distributing the SBCs to its employees as required by ACA.
(j) Group will indemnify and hold Health Plan harmless from and against any loss, cost, damage, judgments, expense, penalty, fine or other liability, including without limitations, attorney and expert fees and other expenses incurred in connection with any investigation, claim, adverse consequence. action or proceeding, either threatened or brought, against Health Plan and arising out of or in connection with any breach, negligent performance, non-performance, act, error, omission, or willful misconduct by Group or any of its employees, subcontractors or agents with respect to this Agreement; any of Group’s representations or warranties contained in this Agreement; or from the failure of Group or any of its employees, subcontractors or agents to comply with any applicable federal or state laws.
SECTION 6. TERMINATION
(a) Group may terminate this Agreement, without cause, at the end of any month by giving Health Plan 30 days advance written notice of termination.
(b) Health Plan may terminate this Agreement upon written notice to Group:
(i) for nonpayment of Premium if the full Premium is not paid by the end of the Grace Period;
(ii) for fraud or material misstatement by Group;
(iii) if Group ceases doing business as a going concern, makes an assignment for the benefit of creditors, admits, in writing, its inability to pay debts as they come due, consents to the appointment of a trustee or receiver, or if a trustee or receiver is appointed for Group or for all, or a substantial part of its properties;
(iv) if Group does not comply with Health Plan's underwriting guidelines;
(v) if Group moves outside the area in which Health Plan is authorized to write business; or
(vi) if Health Plan no longer offers Coverage provided under this Agreement in the area in which Group is located.
(c) No termination shall relieve Health Plan of any obligation imposed upon it by the terms of this Agreement for health care services rendered before the date of termination or relieve Group of any obligation incurred prior to the date of termination of this Agreement.
(d) In the event that Group becomes the subject of a bankruptcy or similar proceeding, Group agrees that any pre-petition benefits provided by Health Plan on credit shall be allowed under 11 U.S.C. § 502 and entitled to their maximum priority, including but not limited to a priority under 11 U.S.C. § 507(a)(4) and § 507(a)(5). Group further agrees that any post-petition benefits that are provided by Health Plan on credit shall be allowed under 11 U.S.C. § 503(b) and entitled to administrative expense priority at the amount set forth in this Agreement.
(e) It is the responsibility of Group to notify its employees and their Covered Dependents of the termination of this Agreement in compliance with all applicable laws. Health Plan reserves the right to notify Members of termination of this Agreement for any reason, including nonpayment of Premium.
(f) In the event that a Group and/or Member is determined to have engaged in fraud or material misrepresentation; premium shall not be refunded.
SECTION 7. GROUP AS AGENT
For all purposes of this Agreement, including the payment of Premiums, Group is the agent for all Members Covered under this Agreement. Notice by or to Group will satisfy any notice requirements of this Agreement or the Plan Documents.
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SECTION 8. ERISA FIDUCIARIES
(a) If Group’s health care plan is subject to the Employee Retirement Income Security Act of 1974 (“ERISA”), Group, or its designee (other than Health Plan), will be the plan administrator of Group’s health care plan under ERISA and will have all the responsibilities and authority of that position including ensuring compliance with ERISA, preparing and distributing summary plan descriptions, and advising all eligible individuals of (i) available benefits and any changes in benefits; (ii) termination of Coverage for any reason, including the failure to make any payments when due; and (iii) their COBRA rights, if any. Health Plan may not be named as, and will not be considered to be, a “named fiduciary” or “plan administrator” within the meaning of ERISA for Group’s employee welfare benefit plan governed by ERISA.
(b) Group delegates the responsibility and discretionary authority to process and pay claims to Health Plan as “claims administrator” and retains all other responsibilities and duties under ERISA not specifically delegated to Health Plan. Health Plan agrees to assume such responsibility and authority, including any responsibility it may have as a “named fiduciary” (as defined under ERISA § 402) for purposes of its claims administration duties, to the extent that under the Group health plan and ERISA it meets the definition of a “named fiduciary.” As the named administrator, Health Plan will have the power and discretion to construe the terms of this Agreement and to determine all questions pertaining to the administration, interpretation, and Application of this Agreement and any Plan Documents that involve eligibility for benefits and the payment or denial of claims. In addition, the parties agree that Health Plan will have the responsibility for ensuring that its claim procedures comply with the Department of Labor’s Claims Procedures described in 29 C.F.R. Part 2560 and for handling all levels of appeals.
SECTION 9. HIPAA PRIVACY NOTICES
Health Plan will prepare Notices of Privacy Practices appropriate for Group under 45 C.F.R. Parts 160 and 167 (“Privacy Standards”), specifically 45 C.F.R. § 164.520. Group represents and warrants that it does not create or receive Protected Health Information, as that term is defined in 45 C.F.R. § 164.501, and neither Group nor any agent / consultant is entitled to receive any Protected Health Information from Health Plan, except as permitted in 45 C.F.R.§ 164.520(a) (2)(iii), or the law of the State of Michigan where more stringent, so that the burden to maintain and provide Notices of Privacy Practices is entirely that of Health Plan. Group will cooperate with Health Plan in the preparation of Notices of Privacy Practices and shall not prepare any such notices independently.
SECTION 10. WORKERS’ COMPENSATION
Upon Health Plan’s request, Group shall submit proof of its Workers’ Compensation Coverage or an exclusion form which has been accepted by the Bureau of Workers’ Disability Compensation. Group shall protect Health Plan's interest related to Workers’ Compensation claims or settlements involving any employee.
SECTION 11. RECORDS
Group shall make payroll and other records available to Health Plan for inspection for the purpose of confirming Member eligibility or whether Group meets Health Plan’s underwriting guidelines pursuant to this Agreement. When necessary, inspection will be conducted at Group's offices, during regular business hours, and upon reasonable advance request from Health Plan. This provision shall survive the termination of this Agreement.
SECTION 12. AMENDMENTS
This Agreement may be amended by either party upon written notice to the other if amendment is necessary in order to comply with applicable laws and regulations. It may be amended by Health Plan on an annual basis, effective upon renewal of this Agreement, with not less than 30 days prior written notice to Group, and for any other reason upon written Agreement by both Health Plan and Group.
If this Agreement is amended at the request of Group other than upon renewal, or as required by law, Health Plan may charge Group an administrative fee in an amount that approximates the costs incurred by Health Plan to implement the amendment.
SECTION 13. ASSIGNMENT
No assignment of the rights, duties or obligations of this Agreement shall be made by Health Plan or Group without the prior written consent of the other party.
SECTION 14. EXCLUSIONS
Notwithstanding anything contained in this Agreement, Health Plan will have no obligations to Group for any Coverage not specified in the Plan Documents nor any Coverage that Group, in whole or in part, contracts with other carriers to provide on behalf of Group. Notwithstanding the foregoing, Health Plan shall provide Coverage required under ACA even if not specifically noted in the Plan Documents.
SECTION 15. THIRD PARTY RIGHTS
This Agreement is not intended to be a third-party beneficiary contract or to confer any rights on any person other than the parties to this Agreement.
SECTION 16. FORCE MAJEURE
In the event that due to circumstances not within the reasonable control of Health Plan, including but not limited to major disaster, epidemic, complete or partial destruction of facilities, riot, civil insurrection, acts of God or of the public enemy, war, terrorism, fire, the elements, earthquakes, labor troubles, floods or storms, strikes or actions of regulatory agencies, disability of a significant part of Health Plan's Participating Providers or entities with whom Health Plan has arranged for services under this Agreement, or similar causes, the rendition of medical or hospital benefits or other services or obligations provided under this Agreement is delayed or rendered impractical, Health Plan shall not have any liability or obligation on account of such delay or failure to provide services. Health Plan is required only to make a good-faith effort to arrange for the provision of services, considering the impact of the event.
SECTION 17. EFFECT OF PAYMENT OR PROVIDING SERVICES
Whether or not signed by both parties, this Agreement shall be effective upon the payment of Premiums by Group or the furnishing of Covered Services by Health Plan.
SECTION 18. CONFIDENTIAL INFORMATION
(a) The parties acknowledge that, in the performance of this Agreement, they may share confidential and proprietary information belonging exclusively to the other. For the purposes of this Agreement, confidential and proprietary information shall include but not be limited to the personal, financial or business affairs of either party, know how, processes, procedures, technology, and any other information, which under the circumstances ought reasonably to be treated as confidential and/or proprietary (“Confidential Information”). Confidential Information shall not include information (i) which has become generally known to the public other than by a breach of this Section;
(ii) which is or becomes known to the other on a non-confidential basis from a third party, provided that the third party is not known to receiving party to be prohibited from disclosing such information by a contractual, fiduciary or other duty owned; (iii) independently developed by the receiving party without the use of any of the information received from disclosing party; or (iv) information required to be disclosed by law or judicial order.
(b) With respect to Confidential Information, and except as expressly authorized herein, the parties agree that during the term of this Agreement and at all times thereafter, they shall not use or otherwise disclose such Confidential Information to any person, except its own employees, contractors and/or agents having a “need to know” or other such recipients as agreed to in writing by the parties prior to disclosure. The parties and their employees, contractors and/or agents shall use at least the same degree of care in safeguarding the Confidential Information of each other as they use in safeguarding their own confidential information, but in no event shall less than due diligence and care be exercised.
(c) This Section shall survive the termination of this Agreement.
SECTION 19. DISPUTE RESOLUTION
The parties hereby consent to the exclusive jurisdiction of the state or federal courts in the State of Michigan to adjudicate any dispute arising under or in connection with this Agreement. Any such dispute shall be brought before the Circuit Court for Kent County, Michigan or the United States District Court for the Western District of Michigan, Southern Division. The parties hereby waive any objection based on inconvenient forum. Each party also waives any right to jury trial in connection with any litigation in any way arising out of or related to this Agreement. Any lawsuit arising out of this Agreement or the Plan Documents must be filed within two (2) years after the cause of action arose. The requirements of this Section 19 shall survive termination of this Agreement.
SECTION 20. NOTICE
Any notice required by Sections 6, 7, 12, 19 and 24 of this Agreement shall be in writing and shall be delivered in person or sent by certified mail, return receipt requested, or sent by a nationally recognized courier service that maintains records of items picked up and delivered, to the addresses first stated above or to such other addresses as may be specified in writing. Any prior written notice period required by this Agreement shall be deemed to start on the date that notice was sent.
SECTION 21. WAIVER
In the event a party waives any provision of this Agreement, it will not be deemed to have waived that provision at any other time or to have waived any other provision.
SECTION 22. DELEGATION AND SUBCONTRACTING
Group acknowledges and agrees that Health Plan may enter into arrangements with third parties to delegate functions hereunder such as utilization management, quality assurance and provider credentialing, as Health Plan deems appropriate in its sole discretion and as consistent with applicable laws and regulations. Group also acknowledges that Health Plan’s arrangements with third party vendors (i.e. pharmacy, behavioral health) are subject to change in accordance with applicable laws and regulations.
SECTION 23. USE OF THE NAME AND ALL SYMBOLS
Trademarks, and Service Marks. Health Plan reserves the right to control the use of Health Plan’s name and all symbols, trademarks, and service marks presently existing or subsequently established. Group agrees that it will not use such name, symbols, trademarks, or service marks in advertising or promotional materials or otherwise without Health Plan’s prior written consent and will cease any and all usage immediately upon Health Plan’s request or upon termination of this Agreement.
SECTION 24. ENTIRE AGREEMENT
This Group Agreement, including the Plan Documents, the New Group Application, any renewal Group Application (if applicable), the rate proposal, the Pre-Renewal letter, and any amendments or attachments/exhibits thereto, constitutes the entire Agreement between Group and Health Plan.
On the Effective Date, this Agreement supersedes all other Agreements for health care services and benefits between the parties. However, if this Agreement, including but not limited to any document referenced herein, contains a typographical error which is a mistake that is known or should have been known by the parties, the parties agree that this Agreement will be amended to correct such error. If one of the parties is unwilling to amend this Agreement to correct the error, the other party may terminate this Agreement by providing written notice to the unwilling party.
SECTION 25. SEVERABILITY
In the event any provision of this Agreement is held to be invalid or unenforceable, the remainder of the provisions of this Agreement will remain in full force and effect.
SECTION 26. GOVERNING LAW
This Agreement shall be governed by Michigan law, and any disputes regarding this Agreement shall be resolved as in accordance with Section 19.
This Agreement is effective upon execution of the New Group Application. By signing the New Group Application, you are agreeing to the terms of this Group Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date set forth above.