Enrollment Eligibility

30.1 - Enrollment Eligibility (Rev. 111, 05-03-13, Effective: 05-03-13, Implementation: 05-03-13) Restricted Enrollment Requirement: In general, MAOs have to accept all Medicare-eligible beneficiaries who reside in their service area as set forth in 42 CFR §422.60(a). EGWPs are not subject to this requirement. Instead, under the CMS eligibility rules for these kinds of plans, EGWPs must restrict enrollment solely to those Medicare eligible individuals who are also eligible for the employer/union sponsor’s employment-based health coverage. See section 1857(i) of the Act. Note that, aside from having Medicare eligibility, the employer/union sponsor’s eligibility rules exclusively govern a beneficiary’s enrollment entitlement in these plans. Under the employer/union sponsor’s eligibility requirements, for example, Medicare eligible spouses and dependents of participants in the employer/union sponsor’s plan may be permitted to enroll in these EGWPs based on the employer/union sponsor’s eligibility rules regardless of whether or not the participant is Medicare eligible. “Employment-Based” Group Health Plan Requirement: Employer/union group health plan enrollment in EGWPs and individual MA plans is only available to Medicare beneficiaries who are members of an employer/union-sponsored group health plan. Thus, a beneficiary’s enrollment in one of these MA plans must be based on receiving “employment-based” health coverage from an employer/union group health plan sponsor that has either entered into a contractual arrangement with an MAO to provide coverage or has contracted directly with CMS to provide coverage for its Medicare beneficiaries.4 Membership in a State Pharmaceutical Assistance Program (SPAP) would not make an individual eligible for enrollment into these types of plans. Similarly, coverage obtained through a professional or other type of group association would not make a beneficiary eligible for these kinds of plans, except to the extent that the coverage obtained through the association can properly be characterized as “employment-based” group health plan coverage. In defining an employer-sponsored group MA plan, employment-based retiree health coverage, and a group health plan we have not precluded professional or other types of group associations from enrolling Medicare beneficiaries in EGWPs and individual MA plans. However, CMS has made clear that a beneficiary’s enrollment in one of these MA plans is based on his/her receipt of employment-based health coverage from an employer/union group health plan sponsor. To the extent that membership in an association is based on employment, that association could meet the definition of employment-based retiree coverage. For example, an association may elect to provide coverage via an EGWP or individual MA plan to retirees who were formerly employed by the association. We also clarify that we believe that employers, such as school districts, could form an association for the purpose of purchasing employer coverage on behalf of retirees from the school districts and that this would be acceptable because, independently, each school district would be eligible to enroll its retirees in an EGWP or individual MA plan. Therefore, for example, two or more school districts could combine to form an association for the purpose of purchasing retirement coverage for their retired employees. However, an association of farm 4 See 42 CFR §422.106. bureaus would not meet this test if membership in a farm bureau were not exclusively based on former employment by these farm bureaus. (See §422.106(d)(4) through (6)). Active Employees and Retirees Eligible for Enrollment: Under section 1857(i) of the Act, MAOs may offer employer/union-only group plans to both retirees and current (i.e., active) employees of a particular employer/union group plan sponsor who are Medicare eligible. However, when enrolling active employees into these employer/union group-sponsored MA plans, MAOs must comply with all applicable Medicare program requirements, including the Medicare Secondary Payer (MSP) requirements. MAOs must ensure that employers do not enroll retirees/active employees in an MA plan offered by the MAO in a manner contrary to MSP rules. See the Medicare Managed Care Manual, Chapter 4 (Benefits and Beneficiary Protections), §130, for more information. For active employees receiving benefits from a group health plan of an employer that employs at least 20 employees, the MSP rules establish that the non-Medicare group health plan is the primary payer and Medicare is the secondary payer. If the enrollee or enrollee's spouse is an active employee, the enrollee must be enrolled in the employer/union-sponsored and/or contributed-to non-Medicare group health plan in order to also be enrolled in the employer/union-sponsored MA plan. In other words, active employees cannot be enrolled in an employer/union-sponsored MA plan unless they also retain their employer/union-sponsored primary coverage. In these situations, Medicare payments to MAOs for these active employees are adjusted accordingly to account for the presence of the primary group health plan payer. More detailed information on MSP requirements is available at 42 CFR §411.100 and 42 CFR §422.108 or in the Medicare Secondary Payer Manual on the CMS website at: http://www.cms.hhs.gov/Manuals/IOM/list.asp.