Beneficiary Liability

210 - Beneficiary Liability (Rev. 4, 10-01-01) CMS will pay the HMO/CMP for the reasonable cost of providing covered services to Medicare enrollees less an amount representing the actuarial value of the deductible and coinsurance the Medicare enrollee otherwise would have been liable for had they not enrolled in the current HMO/CMP or in another Medicare HMO/CMP. The organization may charge Medicare enrollees up to this aggregate amount in the form of premiums, membership fees, copayments, charge per unit of service, or similar charges. Another individual, organization, or entity may pay premiums on behalf of the Medicare enrollee. In addition, a Medicare beneficiary’s private health insurance may be the primary payer under certain circumstances. The HMO/CMP may offer the Medicare beneficiaries supplemental benefit plans to cover deductibles and coinsurance amounts, services not covered under Medicare, or both. If a supplemental benefit plan premium (or other payment method) includes charges for both noncovered services and the deductible and coinsurance amounts applicable to covered services, the portion of the premium representing deductibles and coinsurance must be computed separately, and disclosed to the beneficiary prior to his/her election of such coverage options during the enrollment process. The Medicare beneficiary may, at his/her option, choose coverage under such a plan. If so, he/she is liable for payment for the supplemental benefit plan. In addition, the sum of the amounts the HMO/CMP charges its Medicare enrollees for such supplemental benefit plan services that are not covered under Part A or Part B of Medicare may not exceed the Adjusted Community Rate (ACR) for these services. (See Chapter 8 of this manual for a discussion of the ACR.) For Medicare enrollees entitled to Part B services only, the HMO/CMP premium (or other payment structure) for Medicare Part A type services offered under a supplemental benefit plan to such individual may not exceed the ACR for these services.