Benefit Coordination with a Large Group Health Plan

350.1 - Benefit Coordination with a Large Group Health Plan (Rev. 4, 10-01-01) Under §1862(b)(1)(B) of the Act, Medicare is secondary payer to LGHPs for active individuals under age 65 entitled to Medicare on the basis of disability. Under the law, an LGHP may not take into account that an active individual is eligible for or receives benefits based on disability. The individual’s coverage under the LGHP must be based on the individual’s employment or the employment of a family member. Refer to §3492 of the Medicare Intermediary Manual for processing claims where Medicare is secondary payer for disabled individuals. Where those sections refer to an EGHP of 20 or more employees, substitute the term “large group health plan” for purposes of applying them to disabled individuals. This provision is effective for items and services furnished on or after January 1, 1987, and before October 1, 1995. A large group health plan means any health plan that meets the following criteria: • Is paid for by or contributed to by an employer or by an employee organization, including a self-insured plan; • Provides health care directly or through other methods such as insurance or reimbursement to employees, the employer, other associated or formerly associated with the employer in a business relationship or their families; and • Covers employees of at least one employer that normally employed at least 100 full or part-time employees on a typical business day during the previous calendar year. The term “employer,” for the purpose of this provision, includes the Federal government and other governmental entities. A group health plan that covers employees of at least one employer that had l00 or more employees on 50 percent or more of its business days during the preceding calendar year, is considered to meet the above definition of an LGHP.