Apply a Copay Based Premium

This example shows the configuration for an enrollment product with a choice between different co-payment amounts. A high co-payment means that the policy-holder always pays a large part of the cost for (specific) medical services. This means that the health insurance payer has less costs for that policy and can therefore charge a lower premium for that policy. Likewise, policies with a low co-payment, or none at all, have a higher premium.

In this example there are only three office visit co-payment choices available, either a $10.00, $20.00 or $30.00 co-payment that lead to a $180.00, $175.00 or $170.00 premium amount.

Step 1 - Setup Time Period

The first step is to set up a time period for which the premium amounts apply.

Time Period
Name	Start	End
Calendar year 2020	01-01-2020	12-31-2020

More time periods can be set up later, for example, when we want to specify premium amounts for calendar year 2016.

Step 2 - Setup Co-payment Parameter

The second step is to set up a co-payment parameter. This parameter can then used in the premium schedule. At the same time it becomes available as a setting on the policy enrollment product, so that a policy-holder can choose a co-payment value.

A health plan often has different co-payments for different benefits. In this example, we set up a premium schedule around the office visit co-payment:

Parameter Alias
Code	Display name	Type
COP_OV	Office Visit Co-payment	Amount

Step 3 - Setup a Schedule Definition

The next step is to set up a schedule definition. The schedule definition controls which columns the premium schedule shows in addition to the premium amount. Because we want to add a column for the office visit co-payment, we’ll add a single dimension:

Schedule Definition
Code	Description	Type	Conditions
CP_BASED	Premium (OV Co-pay )	Premium	-

Schedule Dimensions
Header	Seq	Width	Type	Parameter	Dyn Field	Usage
OV Co-pay	1	4	Parameter	COP_OV	-	value

Step 4 - Setup a Premium Schedule

The next step is to set up a premium schedule, based on the schedule definition that we just set up. Once the schedule definition has been saved on the premium schedule header, the premium schedule shows the two columns: one for OV Co-payment (including the currency) and one for the premium amount (including the currency). Note that the currency for the OV Co-payment amounts is updatable; this means that the premium schedule lines can have different currencies for the OV Co-payment amounts.

Premium Schedule Header
Code	Schedule Definition	Type	Amount Interpretation	Currency
CP_BASED_01	CP_BASED	INPATIENT	Calculation Period	USD

Premium Schedule Lines
OV Co-pay	Premium
10.00 USD	180.00 USD
20.00 USD	175.00 USD
30.00 USD	170.00 USD

Step 5 - Assign the Premium Schedule

The premium schedule is now complete, but it won’t be applied in the premium calculation until it is assigned to an enrollment product. To complete the example, we set up an enrollment product and link it to the premium schedule that we have just set up.

Enrollment Product
Code	Assigned Premium Schedules
COPAY PLAN	CP_BASED_01