Premium Assistance Payments

(A) Coverage Types. Premium assistance payments are available to MassHealth members who are eligible for the following coverage types: (1) MassHealth Standard, as described in 130 CMR 505.002: MassHealth Standard, with the exception of those individuals described in 130 CMR 505.002(F)(1)(d); (2) MassHealth Standard for Kaileigh Mulligan, as described in 130 CMR 519.007: Individuals Who Would Be Institutionalized; (3) MassHealth CommonHealth, as described in 130 CMR 505.004: MassHealth CommonHealth; (4) MassHealth CarePlus, as described in 130 CMR 505.008: MassHealth CarePlus; (5) MassHealth Family Assistance for HIV-positive adults and HIV-positive young adults, as described in 130 CMR 505.005(E): Eligibility Requirements for HIV-Positive Individuals Who Are Citizens or Qualified Noncitizens with Modified Adjusted Gross Income of the MassHealth MAGI Household Greater than 133 and Less than or Equal to 200% of the Federal Poverty Level; (6) MassHealth Family Assistance for disabled adults whose Disabled Adult MassHealth household income is at or below 100% of the FPL and who are qualified noncitizens barred, nonqualified individuals lawfully present, and nonqualified PRUCOLs, as described in 130 CMR 505.005(C): Eligibility Requirements for Children and Young Adults Who Are Nonqualified PRUCOLs with Modified Adjusted Gross Income of the MassHealth MAGI Household at or below 150% of the Federal Poverty Level; (7) MassHealth Family Assistance for children younger than 19 years old and young adults 19 through 20 years old whose household MAGI is at or below 150% of the FPL and who are nonqualified PRUCOLs, as described in 130 CMR 505.005(C): Eligibility Requirements for Children and Young Adults Who Are Nonqualified PRUCOLs with Modified Adjusted Gross Income of the MassHealth MAGI Household at or below 150% of the Federal Poverty Level; and (8) MassHealth Family Assistance for children younger than 19 years old whose household MAGI is between 150% and 300% of the FPL and who are citizens, protected noncitizens, qualified noncitizens barred, nonqualified individuals lawfully present, and nonqualified PRUCOLs, as described in 130 CMR 505.005(C): Eligibility Requirements for Children and Young Adults Who Are Nonqualified PRUCOLs with Modified Adjusted Gross Income of the MassHealth MAGI Household at or below 150% of the Federal Poverty Level. (B) Criteria. MassHealth may provide a premium assistance payment to an eligible member when all of the following criteria are met. (1) The health insurance coverage meets the Basic Benefit Level (BBL) as defined in 130 CMR 501.001: Definition of Terms. Instruments including but not limited to Health Reimbursement Arrangements, Flexible Spending Arrangements, as described in IRS Pub. 969, or Health Savings Accounts, as described at IRC § 223(c)(2), cannot be used to reduce the health insurance deductible in order to meet the basic-benefit level requirement. (2) The health insurance policy holder is either (a) in the PBFG; or (b) resides with the individual who is eligible for the premium assistance benefit and is related to the individual by blood, adoption, or marriage. (3) At least one person covered by the health insurance policy is eligible for MassHealth benefits as described in 130 CMR 506.012(A) and the health insurance policy is a policy that meets the criteria of the MassHealth coverage type for premium assistance benefits as described in 130 CMR 506.012(C). (C) Eligibility. Eligibility for MassHealth premium assistance is determined by the individual’s coverage type and the type of private health insurance the individual has or has access to. MassHealth has three categories of health insurance for which it may provide premium assistance. (1) Employer-sponsored Insurance (ESI) 50% Plans are employer-sponsored health insurance plans to which the employer contributes at least 50% towards the monthly premium amount. MassHealth provides premium assistance for individuals with ESI 50% Plans who are eligible for MassHealth coverage types as described in 130 CMR 506.012(A). (2) Other Group Insurance Plans are employer-sponsored health insurance plans to which the employer contributes less than 50% toward the monthly premium amount, Consolidated Omnibus Budget Reconciliation Act (COBRA) coverage, and other group health insurance. MassHealth provides premium assistance for individuals with Other Group Health Insurance Plans who are eligible for MassHealth coverage types as described in 130 CMR 506.012(A), except for individuals described in 130 CMR 506.012(A)(8). (3) Non-group unsubsidized Health Connector individual plans for children only, provided that such plans shall no longer be eligible for premium assistance as of January 1, 2019, and the last premium assistance payment for these plans shall be for coverage through December 31, 2018. (4) Members enrolled in any of the following types of health insurance coverage are not eligible for premium assistance payments from MassHealth: (a) Medicare supplemental coverage, including Medigap and Medex coverage; (b) Medicare Advantage coverage; (c) Medicare Part D coverage; and (d) Qualified Health Plans (QHP). (5) The following MassHealth members are not eligible for premium assistance payments as described in 130 CMR 506.012(C) from MassHealth: (a) MassHealth members who have Medicare coverage. However, for those members who meet the eligibility requirements set forth in 130 CMR 505.002(O), Medicare Savings Program benefits may be available; (b) all nondisabled nonqualified PRUCOL adults, as described in 130 CMR 505.005(D): Eligibility Requirements for Adults and Young Adults 19 and 20 Years of Age Who Are Nonqualified PRUCOLs with Modified Adjusted Gross Income of the MassHealth MAGI Household at or below 300% of the Federal Poverty Level; and (c) disabled nonqualified PRUCOL adults with MassHealth Disabled Adult household income above 100% of the FPL, as described in 130 CMR 505.005(F): Eligibility Requirements for Disabled Adults Who Are Qualified Noncitizens Barred, Nonqualified Individuals Lawfully Present, and Nonqualified PRUCOLs with Modified Adjusted Gross Income of the MassHealth Disabled Adult Household at or below 100% of the Federal Poverty Level. (D) Required Member Contribution. The calculation of the MassHealth required member contribution is as follows. (1) MassHealth may require that a member contribute toward the cost of their health insurance coverage. MassHealth refers to this amount as the MassHealth required member contribution. The MassHealth required member contribution is based on MassHealth MAGI household income and size and/or the MassHealth Disabled Adult household income and size, as described in 130 CMR 506.002 and 130 CMR 506.003, as it relates to federal poverty guidelines and PBFG rules described at 130 CMR 506.011(A). The MassHealth agency will annually adjust and publish the MassHealth required member contribution amounts to account for the last calendar year's increase in federal poverty level (FPL) income standards, starting in calendar year 2026. (2) The following members are responsible for a required member contribution. (a) MassHealth CommonHealth premium-assistance eligible members who have MassHealth MAGI household income or MassHealth Disabled Adult household income greater than 150% of the FPL have the following required member contribution amounts. 1. The required member contribution formula for children younger than 19 years old with household MAGI between 150% and 300% of the FPL is published annually as described in 506.012(D)(1). 2. The required member contribution for adults with household MAGI above 150% of the FPL and children with household MAGI above 300% of the FPL is published annually as described in 506.012(D)(1). 3. CommonHealth members who are eligible to receive a premium assistance payment as described in 130 CMR 506.012 that is less than the CommonHealth required member contribution receive their premium assistance payment as an offset to the CommonHealth monthly premium bill and are responsible for the difference. (b) The required member contribution formula for MassHealth Family Assistance premium assistance eligible children, as described in 130 CMR 505.005 (B): Eligibility Requirements for Children with Modified Adjusted Gross Income of the MassHealth MAGI Household Greater than 150% and Less than or Equal to 300% of the Federal Poverty Level, whose household MAGI is between 150% and 300% of the FPL is published annually as described in 506.012(D)(1). (c) The required member contribution formula for MassHealth Family Assistance premium assistance for HIV-positive adults, as described in 130 CMR 505.005(E): Eligibility Requirements for HIV-Positive Individuals Who Are Citizens or Qualified Noncitizens with Modified Adjusted Gross Income of the MassHealth MAGI Household Greater than 133 and Less than or Equal to 200% of the Federal Poverty Level is published annually as described in 506.012(D)(1). (3) The following members do not have a required member contribution: (a) MassHealth Standard premium assistance eligible members described at 130 CMR 505.002: MassHealth Standard; (b) MassHealth CommonHealth premium assistance eligible members, as described in 130 CMR 505.004: MassHealth CommonHealth, who have household MAGI at or below 150% of the FPL; (c) MassHealth CarePlus premium assistance eligible members, as described in 130 CMR 505.008: MassHealth CarePlus; (d) MassHealth Family Assistance premium assistance eligible members, as described in 130 CMR 505.005(C): Eligibility Requirements for Children and Young Adults Who Are Nonqualified PRUCOLs with Modified Adjusted Gross Income of the MassHealth MAGI Household at or below 150% of the Federal Poverty Level, whose household MAGI is at or below 150% of the FPL; and (e) MassHealth members who have verified that they are American Indians or Alaska Natives who have received or are eligible to receive an item or service furnished by the Indian Health Service, an Indian tribe, a tribal organization, or an urban Indian organization, or by a non-Indian healthcare provider through referral, in accordance with federal law. These members receive premium assistance payments totaling the full employee share, to the extent that it is cost effective for the MassHealth agency. If it is not cost effective for the MassHealth agency, these members may choose to accept a premium assistance amount that is lower than the full-employee share or they may choose to enroll in direct coverage under MassHealth Family Assistance. (E) MassHealth Premium Assistance Payment Amount Calculation. (1) Formulas. The MassHealth agency uses two formulas to calculate the premium assistance payments. The formulas are based on the category of assistance a member is enrolled in. In the event an individual is covered by more than one private health insurance policy, MassHealth will include that individual in the calculation of one premium assistance policy. (a) The monthly premium assistance formula for ESI 50% Plans is described in 130 CMR 506.012(E)(2). (b) The monthly premium assistance formula for Other Group Insurance Plans is described in 130 CMR 506.012(E)(3). (2) MassHealth Premium Assistance Payment Amount Calculation — ESI 50% Plans. (a) Determination of Actual Premium Assistance Payment Amount. To determine the actual premium assistance payment amount, MassHealth must review and compare the estimated premium assistance payment amount and the cost-effective amount. The estimated premium assistance payment amount and cost-effective amount are compared to calculate the actual premium assistance payment amount. 1. Estimated Premium Assistance Premium Payment Amount. The estimated premium assistance payment amount is calculated by subtracting the employer share of the policyholder’s health insurance premium and the MassHealth required member contribution of the health insurance premium, as described in 130 CMR 506.012(D), from the total cost of the health insurance premium. 2. Cost-effective Amount. The ESI 50% Plans cost-effective amount is the MassHealth agency’s cost of providing direct MassHealth benefits to the premium billing family group (PBFG) who are beneficiaries of the ESI. (b) Comparison of Payment Amounts. The MassHealth agency compares the estimated premium assistance payment amount and cost-effective amount to determine the actual premium assistance payment amount. 1. If the estimated premium assistance payment amount is less than the cost-effective amount, the MassHealth agency sets the actual premium assistance payment amount at the estimated premium assistance payment amount. 2. If the estimated premium assistance payment amount is equal to or greater than the cost-effective amount, the MassHealth agency sets the actual premium assistance payment amount at the cost-effective amount. The policy holder is responsible for payment of the remainder of the health insurance premium, if any. (c) Example. A parent and two children apply for MassHealth. The two children are eligible for MassHealth, but the parent is not eligible. Their health insurance is an ESI 50% plan. 1. The total monthly cost of the health insurance premium = S. 2. The employer’s monthly share of the health insurance premium = T. 3. The MassHealth estimated member share of the monthly health insurance premium = U. 4. Calculating the estimated premium assistance payment amount: S = (total cost of premium) - T = (employer’s share of the cost) V = (employee’s share of the cost) - U = (the MassHealth estimated member share of the cost) W = (estimated premium assistance payment amount) ESI 50% Plans cost-effective amount: W is compared to the MassHealth cost of covering the three individuals (X). If W is less than X, the MassHealth agency sets the actual premium assistance payment amount at W. If W is equal to or greater than X, the MassHealth agency sets the actual premium assistance payment amount at X. (3) MassHealth Premium Assistance Payment Amount Calculation — Other Group Insurance Plans. (a) Determination of Actual Premium Assistance Payment Amount. To determine the actual premium assistance payment amount, the MassHealth agency must review and compare the estimated premium assistance payment amount and the cost-effective amount. The estimated premium assistance payment amount and cost-effective amount are compared to calculate the actual premium assistance payment amount. 1. Estimated Premium Assistance Payment Amount. The estimated premium assistance payment amount is calculated by subtracting both the MassHealth required member contribution, as described in 130 CMR 506.012(D), and any contribution amount from an employer a person covered by this plan is eligible for from the total cost of the health insurance premium. 2. Cost-effective Amount. The Other Group Insurance Plans cost-effective amount is the MassHealth agency’s cost of covering MassHealth-eligible premium billing family group (PBFG) members who are beneficiaries of the Other Group Insurance Plan. (b) Comparison of Payment Amounts. The MassHealth agency compares the estimated premium assistance payment amount and cost-effective amount to determine the actual premium assistance payment amount. 1. If the estimated premium assistance payment amount is less than the cost-effective amount, the MassHealth agency sets the actual premium assistance payment amount at the estimated premium assistance payment amount. 2. If the estimated premium assistance payment amount is equal to or greater than the cost-effective amount, the MassHealth agency sets the actual premium assistance payment amount at the cost-effective amount. The policy holder is responsible for payment of the remainder of the health insurance premium, if any. (c) Example. A parent and two children apply for MassHealth. The two children are eligible for MassHealth, but the parent is not eligible. Their health insurance falls into Other Group Insurance Plans. 1. The total monthly cost of the health insurance premium = S. 2. The monthly contribution amount for an employer that a person covered by this plan is eligible for = T. 3. The MassHealth required member contribution toward the monthly health insurance premium = U. 4. Calculating the estimated premium assistance payment amount: S = (total cost of premium) - T = (monthly contribution from an employer) V = (employee’s share of the cost) - U = (the MassHealth estimated member share of the cost) W = (estimated premium assistance payment amount) Other Group Insurance Plans cost-effective amount: W is compared to the cost of covering only those MassHealth eligible individuals = Z. If W is less than Z, the MassHealth agency sets the actual premium assistance payment amount at W. If W is equal to or greater than Z, the MassHealth agency sets the actual premium assistance payment amount at Z. (F) MassHealth Premium Assistance Payment Administration. (1) Premium Assistance Payments. (a) The MassHealth agency makes only one premium assistance payment per policy. (b) Premium assistance payments are made directly each month to the policyholder. (c) Proof of health insurance premium payments may be required. (d) Premium assistance payments begin in the month of the MassHealth Premium Assistance eligibility determination or in the month that health insurance deductions begin, whichever is later. (e) Each monthly premium assistance payment is for health insurance coverage in the following month. (f) The MassHealth agency reviews the cost effectiveness of the member’s health insurance at least once every 12 months. (2) Change in Premium Assistance Calculation. (a) The premium assistance amount is recalculated when the MassHealth agency is informed of changes in the federal poverty level, health insurance premium, employer contribution, and whenever an adjustment is made in the premium assistance payment formula. (b) Members whose premium assistance amount changes as the result of a reported change or any adjustment in the premium assistance payment formula receive the new premium assistance payment beginning with the calendar month following the reported change. (3) Termination of Premium Assistance Payments. (a) If a member’s health insurance terminates for any reason, the MassHealth premium assistance payments end. (b) If there is a change in the services covered under the policy that affects the BBL requirements, the premium assistance payments end. (c) Members who become eligible for a different coverage type in which they are not eligible to receive a premium assistance benefit receive their final premium assistance payment in the calendar month in which the coverage type changes. (d) If a member voluntarily withdraws their MassHealth application for benefits, the MassHealth premium assistance payments end. (130 CMR 506.013 Reserved)