Transplant Carve Out Insurance
What is a Transplant Carve Out?
A stand-alone, fully-insured (first dollar) product that is designed
specifically for self-insured groups.
Works in conjunction with a self-funded plan by “carving out” the
transplant benefit and insuring it separately from the plan
Protects the employer from catastrophic expenses of transplant
exposures more completely than the plan document.
Can attach to any plan document, regardless of the stop loss
AVG. Billed Charges Per Transplant*
BMT - Allogeneic Unrelated $293,100
BMT - Allogeneic Related $232,600
BMT - Autologous $144,500 2000
Kidney-Pancreas $138,300 2005
$0 $100,000 $200,000 $300,000 $400,000 $500,000 $600,000 $700,000 $800,000 $900,000
* includes evaluation, procurement, hospital, physician, follow-up and drugs
(Milliman USA research report 2005)
Number of Transplants per Year
Bone Marrow 16,890
Kidney / Pancreas 885
Waiting List Candidates 89,187
(Milliman 2005 US Organ and Tissue Cost Estimates Report)
Average Waiting Times for Transplants*
Heart 206 days
Lung 704 days
Heart / Lung 889 days
Liver 517 days
Kidney 1,099 days
Pancreas 179 days
Kidney / Pancreas 442 days
Intestine 285 days
*United Network of Organ Sharing data
Transplant Probability by Group Size
NO. OF EES 1 YEAR 3 YEARS 5 YEARS
100 8% 21% 32%
200 14% 37% 54%
300 21% 50% 69%
400 27% 61% 79%
500 32% 69% 86%
750 44% 83% 95%
1000 54% 90% 98%
1500 69% 97% 100%
2000 79% 99% 100%
$1 million maximum ($2M available).
Benefit period starts at evaluation and extends 365 days post transplant.
Covers ALL major transplant types-- heart, lung, heart/lung, kidney, pancreas,
kidney/pancreas, liver, bone marrow, small bowel.
Pays 100% of transplant-related costs when in network.
Pays 80% up to scheduled amount per transplant when out-of-network.
Travel benefit of $10,000/yr. for patient and companion.
Access to our major transplant facilities and case management.
How the Program is Underwritten (cont’d)
Disclosure encompasses any employee that has
had a transplant or been recommended, evaluated,
or listed as needing a transplant 24 months prior to
Run-out Expenses (365 days post transplant) are
covered automatically IF the transplant procedure
occurs during the contract period, regardless
whether the group renews.
Re-transplants are covered and considered as
separate benefit periods if separated by 90 days
from the last transplant, otherwise the benefit
period is based on date of the first transplant.
Transplant Medical Management
Identification and Referral
Program usually requires 500-1000 employee lives.
Pooling allows minimums to drop down to 50 employee
lives to protect the smaller employer.
Pooling allows for block underwriting across several
groups to help stabilize rates despite exposures in one or
Pooling allows both big and small groups an even
playing field rate-wise, as opposed to underwriting each
Benefits of Carve Out Insurance
Stop Loss Insurance may not protect against
transplant exposures (tendency to jump over
contract years and thus be a target for
A problem-solver to 40% or more of imposed
lasers on self-funded groups.
Offers integrated management of a very
difficult medical exposure, saves
Direct payment to providers eases cash flow.
Benefits of Carve Out Insurance, cont’d
Policy addresses Experimental / Investigational issues (coverage
for Adult NCI Phase Trial III and above, all phases for pediatrics).
Pre-ex’d individuals will be covered in 12 months (no pre-ex’s on
renals, hepatitis, mylomas, etc.)
Patient has no co-insurance or deductible out-of-pocket
expenses. Nor does the employer.
Avg. 10% discount on Spec Premium
Offers a more focused approach to managing the patient and
improving outcomes by access to best facilities and experienced
Provides an opportunity to upgrade a benefit within the plan
document to help attract and retain employees – usually much
more beneficial than coverage in the plan document.
Irrefutable Value Proposition
Of Transplant Carve Outs
Spec Deduct. Est. SL Premium Transplant Premium
$50,000 $170,000 $21,000
transplant exposure $16.66 pepm $7.00 pepm
Probable Laser $200,000
7% discount off ($12,000)
-($21,000 minus $12,000) = $9,000
$66.66 pepm… ……….. ……Vs. …………… …$3.00 pepm
Transplant occurs year 1, saves = $191,000
...if no transplant until year 2, saves = $181,000
…if no transplant until year 3, saves = $172,000
Number of years necessary to go without a transplant exposure for the program to be a negative
financial value .. 23 years