Apply a Fixed Amount Discount Based on a Copay Parameter
This example shows how to set up an adjustment that reduces the base premium based on the office visit co-payment. It is a variation on the How to Configure a Premium that Depends on the Office Visit Co-payment.
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 $0.00, $5.00 or $10.00 discount on the premium.
Step 1 - Setup Time Period
The first step is to set up the time period that governs the 'condition' columns on the adjustment rule.
| Time Period | ||
|---|---|---|
Name |
Start |
End |
Calendar year 2020 |
2020-01-01 |
2020-12-31 |
More time periods can be set up later, for example, when we want to specify that co-payment amounts have increased to $15.00, $25.00 and $35.00 in calendar year 2021. In this example there is only one condition, that is, the co-payment amount.
Step 2 - Setup Co-payment Parameter
The second step is to set up a co-payment parameter. This parameter becomes available in the adjustment rule. At the same time it becomes available as a setting on the policy enrollment product, so that a policyholder can choose a co-payment value.
| 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 of type Adjustment. This schedule definition controls which columns the adjustment rule shows in addition to the columns for the value and value type. To add a column for the office visit co-payment, add the parameter from step 2 as a dimension:
| Schedule Definition | ||||
|---|---|---|---|---|
Code |
Description |
Type |
Premium Scope |
Conditions |
DC_COP |
OV Co-pay Discount |
Adjustment |
Product |
- |
| Schedule Dimensions | ||||||
|---|---|---|---|---|---|---|
Header |
Seq |
Width |
Type |
Parameter |
Dyn Field |
Usage |
OV Co-pay |
1 |
4 |
Parameter |
COP_OV |
- |
Value |
Step 4 - Setup Adjustment Rules
Now the schedule definition has been created, a new adjustment type [1] has become available. The next step is to set up adjustment rules for this new adjustment type.
| Adjustment Type | |
|---|---|
Code |
Description |
DC_COP |
OV Co-pay Discount |
| Adjustment Rules | |
|---|---|
OV Co-pay |
Adjustment |
10.00 USD |
0.00 USD |
20.00 USD |
-5.00 USD |
30.00 USD |
-10.00 USD |
In this example there are only three office visit co-payment choices available, either a $10.00, $20.00 or $30.00 co-payment. The adjustment is a discount, therefore the amount has a negative sign.
Step 5 - Assign the Adjustment
The adjustment rule configuration is now complete, but it won’t be applied in the premium calculation until it is attached to an enrollment product or, in case of a group adjustment, group account product, group account or group client . To complete the example, set up an enrollment product and link it to the adjustment type that we’ve created. The adjustment rule configuration is now complete, but it won’t be applied in the premium calculation until it is attached to an enrollment product or group account product, group account or group client in case of a group adjustment. To complete the example, set up an enrollment product and assign a premium schedule to it.
| Enrollment Product | |
|---|---|
Code |
Assigned Premium Schedules |
COPAY PLAN |
DC_COP |
Step 6 - Link the Adjustment to the Enrollment Product
On the adjustment tab, in the enrollment product page, it is possible to assign adjustment types to an enrollment product. When assigning an adjustment type, choose the sequence in which the different types are calculated. This is especially relevant for adjustments that are based on a percentage. More information on how adjustment rules are evaluated can be found in Calculate Premium.