Human Resources: Employee Benefits

How CIGNA Choice Fund® Works

Example 1 – Meet Susan

She is single and in her 30s. Between work and a number of sports leagues, she is always on the go. Susan is healthy with low annual medical expenses – except for the occasional sports injury…

  1. During Annual Enrollment, Susan elects CIGNA Choice Fund single coverage, which includes:
    • Heath Reimbursement Arrangement (HRA) $1,100
    • Susan’s share of deductible $400
    • Medical Plan (Plan Pays in-network) 90%
    • Preventive Care Covered at 100%
  2. In February, Susan goes to her doctor for a routine physical. This cost $250 and is covered 100% by the Plan's Preventive Care. Her HRA is not reduced.
  3. In July, Susan is diagnosed with a sinus infection. Her office visit costs $100 and her antibiotics cost $55. These eligible expenses are paid through Susan's HRA. At this point, she has $945 remaining in her HRA fund.
  4. In August, Susan severely sprains her ankle. Her treatment, including an emergency room visit and physical therapy, cost $650. These eligible expenses are paid by Susan's HRA, leaving $295 in her HRA fund.
  5. Susan has no other medical or pharmacy expenses for the year. The $295 in her HRA fund rolls over to the next year. Susan had no out-of-pocket expenses for the year, so she did not have to pay $400 and she did not use the 90% medical plan coverage.

Example 2 – Meet the Coopers

The Cooper family is expecting their first child. This year's annual expenses will be higher than normal because of the new baby and Jim’s outpatient surgery for an old football injury.

  1. During Annual Enrollment, Jim elects CIGNA Choice Fund family coverage, which includes:
    • HRA $2,200
    • Cooper's share of deductible $800
    • Medical Plan (Plan Pays) 90%
    • Preventive Care Covered at 100%
  2. In February, Jim gets pneumonia. The cost of his treatment, including office visit, prescription and chest X-rays, is $650. These eligible expenses are paid by the HRA fund. There is $1,550 remaining in the HRA fund.
  3. In August, Jessica gives birth to baby Julie. This cost $2,300 for the hospital visit, delivery and prescription drugs. Here is how it is paid:
    • Of the $2,300 eligible expenses, $1,550 is deducted from the HRA. The HRA fund goes to $0.
    • The Coopers must pay the balance of $750 ($2,300 - $1,350 = $750) as part of their share of the $800 annual deductible. They have $50 remaining to meet their $800 deductible
  4. In June, Jessica fractures her wrist. Her treatment, including an emergency room visit, prescription drugs, follow-up office visits, and physical therapy, cost $6,050.
    • The Coopers pay the remaining $50 of their deductible
    • This leaves $6,000, which is paid through the health plan coinsurance. The Coopers pay 10% ($600) and the health plan pays 90% ($5,400).
  5. In July, Jessica Julie takes the baby for her check-up. Baby Julie receives her scheduled immunizations. The doctor’s visit is $100 and is covered 100% by Preventive Care.
  6. In September, Jim has an in-network, outpatient procedure that adds up to $7,700. Here is how it is paid:
    • The Coopers have now paid $1,400 of their $2,000 out-of-pocket maximum.
    • Of the $7,700 for the procedure, the Coopers pay $600 to meet their out-of-pocket maximum and the health plan pays the remaining $7,100.
    • The Coopers have meet their total out-of-pocket expense so the plan will pay for any other medical expenses at 100% for the rest of the plan year.
  7. In October, Jim goes for a follow-up office visit, which costs $300. The Coopers have met their out-of-pocket maximum, so the amount is paid 100% by the plan.
  8. Total paid by the Coopers: $2,000
    (Deductible, Coinsurance)
  9. Total paid by the Plan: $15,100
    (HRA, Coinsurance, Preventive Care)