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Medicare and Employers

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					Medicare and Employers

  National Association of
  Health Underwriters
     June 2009
Medicare Basics Review
    Medicare is a health insurance program for:
         People age 65 or older
         People under age 65 with certain disabilities,
         People of all ages with end-stage renal disease (permanent kidney
          failure requiring dialysis or a kidney transplant)
    Medicare has two basic parts:
         Part A Hospital Insurance
            Most people don’t pay a premium for Part A, and

         Part B Medical Insurance – usually out of the hospital
            Most people pay a monthly premium for Part B - $96.40 in 2009.
               (higher income beneficiaries may pay more)
            The cost of Part B may go up 10% for each full 12-month period
             that you could have had Part B but didn’t enroll and your Part B
             coverage as a late enrollee will start on July 1 of the year you
             enroll. This additional cost is permanent.
Medicare Part B and Employer
Health Plan Coverage
    If you or your spouse is working and has group
     health coverage you are eligible to defer your
     enrollment in Part B without a penalty.
    You may enroll in Part B without penalty
     anytime you are still covered by your employer
     as an active employee (not retiree or COBRA),
     or
    During a special enrollment period in the eight
     months following the month your employer or
     union coverage ends.
Medicare Part B and Employer
Health Plan Coverage
    IMPORTANT - Once you are no longer covered under
     your employer’s plan you are strongly advised to sign
     up for Part B before the end of the eight month special
     enrollment period.
    If you don’t, you’ll only be able to enter Part B during a
     general enrollment period, which means that you may
     have to go a significant period of time with health
     insurance coverage only under Part A.
    Your open enrollment period for Medigap will only
     begin once your Part B begins, so it is VERY important
     to enroll during the eight month period.
Medicare Part B and Employer
Health Plan Coverage
    In addition, if you wait to enroll, your Part B
     premiums will go up.
    Whether you decide to enroll in Part B while
     you’re still actively at work or wait until your
     group health plan coverage ends, it is
     important to remember than your open
     enrollment period for Medigap coverage
     begins when you enroll in Part B.
    Open enrollment is a one time option that
     allows you to select any Medigap plan
     available in your area regardless of your
     health status.
Part B and COBRA

  You should consider enrolling in Part B
   even if you take COBRA.
  Because COBRA isn’t considered
   coverage as an active employee, your
   eight month Part B special enrollment
   period begins on the last day of your
   employment or the month your employer
   or union coverage ends, not when your
   COBRA ends.
Part B and COBRA
    You may want to consider whether or not
     coverage under Medigap or through a
     Medicare Advantage plan would be better for
     you than electing COBRA.
    If you are age 65 or older and do elect
     COBRA, be aware that your employer plan
     may require you to sign up for Part B in order
     to receive full plan benefits.
    In that case, the best time to sign up for
     Medicare Part B is before your employment
     ends or you lose your employer’s coverage.
Part B and COBRA
    If you wait to sign up for part B during the eight
     months after employment or coverage ends,
     your employer plan could require you to be
     responsible for services that Medicare would
     have paid for if you had signed up earlier.
    As a reminder, if you don’t sign up for part B
     during the eight month period after your
     employment ends or you lose coverage, you
     will only be eligible to sign up during the
     general open enrollment and your Part B
     premiums will go up.
COBRA and Medicare

  If you already have COBRA coverage
   when you first enroll in Medicare, your
   COBRA coverage may end.
  Your employer has the option of
   canceling your COBRA coverage if your
   first Medicare enrollment is after the date
   you elected COBRA coverage, and the
   majority of employers do.
Who Pays First – Large Groups
    If you are age 65 or older, actively employed,
     and covered by a group health plan where the
     employer has 20 or more employees, the
     group health plan is primary and Medicare is
     secondary
    Some people choose not to take Part B in this
     situation since taking Part B triggers the open
     enrollment period for Medigap and Medigap is
     probably not needed at this time.
    Once your active employment ends, you’ll
     have a special enrollment opportunity to enroll
     in Part B.
Who Pays First – Large Groups
    Then Medicare will be primary and you’ll be
     able to select from among all the Medigap
     plans available in your area regardless of your
     health status.
    Keep in mind that although Medicare Part A is
     supplementing your group health plan, not
     taking Part B may mean that some of your
     expenses that would have been payable
     through Medicare Part B as the secondary
     payer may not be payable.
Who Pays First – Small Groups

  If you are age 65 or older and actively
   employed and covered by a group health
   plan where the employer has less than
   20 employees, Medicare is primary and
   the group health plan is secondary
  This may also be the case if your
   employer is part of a multi-employer plan
   that has requested an exemption that
   has been approved by Medicare.
Who Pays First – Small Groups
    You have the option when covered under a group
     health plan not to take Part B, however, it is often not
     advisable to do so when covered under a plan with
     less than 20 employees.
    Many small employer plans pay secondary benefits for
     Medicare eligible employees as if they were covered
     by both Part A and Part B, regardless of whether or
     not they are actually enrolled in Part B.
    If you’re covered by a small employer plan and don’t
     enroll in Part B, you may find that you’ll still have to
     pay a large portion of your medical expenses out of
     your own pocket.
Who Pays First – Small Groups
    Remember that when you enroll in Part B, you
     trigger your one time open enrollment period
     for Medigap
    It is especially important for Medicare
     beneficiaries with health conditions to
     purchase Medigap coverage during their open
     enrollment period, even if that means buying a
     policy while still covered by an employer plan
    Even beneficiaries in good health may want to
     protect their right to purchase the policy they
     want by purchasing during the open
     enrollment period.
Who Pays First - Retirees

    If you are covered by a group health plan
     as a retiree and are age 65 or older,
     Medicare is primary regardless of the
     plan size.
Who Pays First - Disability

  If you are disabled and covered by a
   large group health plan and the employer
   has more than 100 employees, the
   health plan is primary and Medicare is
   secondary.
  If you are disabled and covered by a
   large group health plan with less than
   100 employees Medicare is primary and
   the group health plan is secondary.
Who Pays First - Disability

  If your employer has less than 100
   employees but is part of a multi-
   employer plan that has any employer
   with 100 or more employees, the group
   health plan is primary and Medicare is
   secondary.
  If you are disabled and covered by
   Medicare and COBRA, Medicare is
   primary and COBRA is secondary.
End Stage Renal Disease

  End State Renal Disease is a medical
   condition in which a persons kidneys
   cease functioning on a permanent basis
   leading to the need for long-term dialysis
   or a kidney transplant.
  Beneficiaries may become entitled to
   Medicare based on ESRD.
ESRD Medicare Benefits
    Benefits on the basis of ESRD are for all
     covered services not only those related to
     kidney failure.
    Medicare is secondary to group health plans
     for individuals entitled to Medicare based on
     ESRD for 30 months regardless of the number
     of employees and regardless of whether the
     employee is an active employee or covered by
     COBRA, even if the employer plan says that it
     is secondary to Medicare.
ESRD Medicare Benefits
    The health plan may not provide different
     benefits to those who have ESRD, and they
     may not terminate coverage, impose benefit
     limitations, or charge higher premiums on the
     basis of ESRD.
    When the beneficiary first enrolls in Medicare
     based on ESRD, Medicare coverage usually
     begins on the 4th month of dialysis when the
     beneficiary participates in a dialysis treatment
     in a dialysis facility.
ESRD Medicare Benefits

    Medicare coverage can start as early as the
     first month of dialysis if the beneficiary takes
     part in a home dialysis training program in a
     Medicare-approved training facility to learn
     how to do self-dialysis treatment at home, the
     beneficiary begins home dialysis training
     before the third month of dialysis, and the
     beneficiary expects to finish home dialysis
     training and gives self-dialysis treatments.
ESRD Medicare Benefits
  Medicare coverage can start the month the
   beneficiary is admitted to a Medicare-approved
   hospital for a kidney transplant, or for health care
   services that are needed before the transplant if
   the transplant takes place in the same month or
   within the two following months.
  Medicare coverage can start two months before
   the month of the transplant if the transplant is
   delayed more than two months after the
   beneficiary is admitted to the hospital for that
   transplant or for health care services that are
   needed before the transplant.
When Medicare Coverage Ends
    If the beneficiary only has Medicare because
     of ESRD, coverage will end 12 months after
     the month dialysis treatments are stopped, or
     3 months after a successful kidney transplant.
    Coverage will not end if the beneficiary has to
     start dialysis again or receives a kidney
     transplant within 12 months after stopping
     dialysis or if the beneficiary continues to
     receive dialysis or receives another kidney
     transplant within 36 months after a transplant.
Who Pays First – Auto Insurance and
Workers Compensation

   No-fault or liability coverage is always
    the primary payer over Medicare
   Workers Compensation usually covers
    all expenses, however, Medicare may
    make a conditional payment while the
    beneficiary’s claim is pending.
Who Pays First – VA and TRICARE

    Veteran with Veterans’ benefits – Medicare
     pays first for Medicare-covered services, but
     VA pays for VA authorized services (Medicare
     and VA can’t pay for the same service)
    TRICARE – Medicare pays for Medicare-
     covered services but TRICARE pays for
     services from a military hospital or any other
     federal provider.
    TRICARE may also pay secondary to
     Medicare.
Medicare Secondary Payer

    Medicare Secondary Payer (MSP) is the term
     used by Medicare when Medicare is not
     responsible for paying first.
    This process is very similar to the COB rules
     used by private industry for assigning
     responsibility for first and second payment.
    Medicare secondary payer laws take
     precedence over State law and private
     contracts.
Responsibilities of Beneficiaries
    Respond to questions from Medicare about other
     coverage in a timely manner.
    Make sure that your Medicare Contractor is aware of
     any changes in your coverage in addition to Medicare
     through yours or your spouse’s employment.
    You can call the Medicare COB contractor at 1-800-
     999-1118.
    Make sure your doctors and other medical providers
     also know about these changes so they can bill for
     your medical services appropriately.
Responsibilities of Employers
    Provide CMS with information regarding the
     health coverage of Medicare-eligible workers
     and spouses when requested.
    Make sure your health plan provides for
     primary payment for these individuals.
    Consider not only employees and spouses
     age 65 and over but also those with
     permanent kidney failure and disabled
     Medicare beneficiaries.
    Complete and submit Data Match reports
     timely on identified employees.
Data Match

    The law requires the IRS, Social Security
     Administration and CMS to share information
     that each agency has about whether Medicare
     beneficiaries or their spouses are working.
    The process is called the IRS/SSA/CMS Data
     Match.
    The purpose is to identify situations where
     another payer may be primary to Medicare.
Data Match

  Employers are required to complete a
   questionnaire that requests group health
   plan information on identified workers
   who are either entitled to Medicare or
   married to a Medicare beneficiary.
  The Data Match Project has saved the
   Medicare Trust Funds more than 3.5
   billion dollars to date.
Employer Reporting Requirements

    The employer must provide information about
     their workers whenever CMS identifies those
     individuals to the employer.
    Generally, the questionnaire asks if each
     named individual worked during a specific time
     period and if so whether he or she had
     employer sponsored group health plan
     coverage.
    Employers must respond within 30 days of the
     initial inquiry, unless an extension has been
     requested and approved.
Employer Reporting Requirements

    The COB Contractor has responsibility for
     virtually all initial MSP development activities
     and in addition handles MSP related inquiries
     for general information.
    MSP claims are identified in a number of
     ways.
        When a claim is submitted with an EOB from an
         insurer rather than Medicare, a questionnaire is
         sent to the beneficiary to collect information on the
         existence of other insurance that may be primary to
         Medicare.
Employer Reporting Requirements

    MSP information is also collected through self-
     reports which are basically reports from any
     source that contacts the COB contractor with
     information on other coverage.
    When a diagnosis appears on a claim that
     indicates a traumatic accident, injury, or
     illness, a questionnaire is sent to the
     beneficiary, provider, attorney, or insurer to
     collect more information.
    A process identified as CFR 411.25 is used to
     confirm MSP information received from a third
     party payer.
Employer Reporting Requirements

  An instruction booklet is available to
   assist employers with completion of the
   questionnaire.
  As an alternative to the Data Match,
   employers may want to consider an
   employer voluntary data sharing
   agreement with CMS to exchange group
   health plan and Medicare entitlement
   data.
Employer Voluntary Data Sharing
Agreements

  Many large employers have entered into
   Voluntary Data Sharing Agreements with
   CMS to share coverage information.
  There are substantial benefits from
   entering into this type of agreement.
  One benefit is that it allows the employer
   to avoid completion of Data Match
   questionnaires, eliminate repayment of
   claims and associated penalties.
Employer Voluntary Data Sharing
Agreements

    With this type of agreement, the employer
     agrees to electronically share on a quarterly
     basis health plan entitlement information for
     employees and their spouses.
    In exchange, CMS agrees to provide the
     employer with Medicare entitlement
     information for identified individuals.
    This enables claims to be paid by the correct
     payer the first time.
Employer Voluntary Data Sharing
Agreements

     A VDSA is a cost effective way to satisfy your
      requirement to complete annual Data Match
      questionnaires.
     Most employers handle Data Match manually.
     The automated process will provide
      administrative savings and more effective
      coordination of benefits.
     VDSAs identify not only when Medicare is the
      secondary payer, but also when Medicare is
      the primary payer to your insurer.
Beneficiary Automated Status and
Inquiry System (BASIS)
    The Beneficiary Automated Status and Inquiry
     system (BASIS) is available to participants of
     the Voluntary Data Sharing Agreement
     (VDSA) program.
    It allows online Medicare entitlement queries
     to determine if an individual is a Medicare
     beneficiary.
    Participants may request Medicare information
     for up to 100 enrollees per month.
Questions?