*** The Health Care Programs Manual (HCPM) has been replaced by the Minnesota Health Care Programs Eligibility Policy Manual (EPM) as of June 1, 2016. Please refer to the EPM for current health care program policy information. ***
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Effective: January 1, 2013 |
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15.10.05.15 - Cost Effective Premium Reimbursement |
Archived: June 1, 2016 (Previous Versions) |
The county agency must pay health care coverage premiums if DHS or the county determines the premiums are cost effective and all of the reimbursement requirements are met.
Counties may either:
l pay premiums directly to the employer or insurance provider.
l reimburse clients or anyone else who pays the premium.
Exception: Do not reimburse premiums for parents court-ordered to provide medical support unless the parent is MA eligible.
Note: See the MMIS User Manual for information about entering cost effective information in the MMIS TPL subsystem.
County of Financial Responsibility.
Retroactive Reimbursement Requirements.
Medical Support Reimbursements.
Mail Order Prescription Drug Reimbursement.
County of Financial Responsibility
Counties financially responsible for a client living in another county (for example, excluded time) are responsible for reimbursing the premiums. The servicing county should send payment recommendations to the financially responsible county.
Reimburse premiums paid by the client or other individuals. Premiums may also be paid directly to the employer or the insurance provider.
Example:
Jared is 23 years old, disabled and lives on his own. However, he is still covered by his father’s health insurance. His father pays the monthly insurance premium. The insurance is cost effective for Jared. Jared’s father is not court-ordered to provide coverage for Jared.
Action:
Reimburse Jared’s father for the portion of the premium determined cost effective for Jared.
Reimburse a client for the cost effective health insurance premiums if the client verifies the premium payment and all of the following are met:
l The client or a person other than a parent who is court ordered to provide medical support verifies payment of the premium.
l The premiums were not used to meet one of the following:
Note: The client is eligible for reimbursement of the difference between the total amount paid for premiums in the month of application and any retroactive months and the amount used to meet the spenddown or asset reduction for months the client was otherwise eligible for MA.
Example:
Pete applies for MA in April requesting retroactive coverage for March. He is eligible for MA with a spenddown starting in March. Pete's health insurance is determined to be cost effective. He paid his health insurance premium of $80 per month for March and April. $60 of the March and April premiums were used to meet his spenddown.
Action:
Reimburse Pete for $20 of the March premium and $20 of the April premium for a total of $40.
l Premiums may be reimbursed retroactively for no more than 12 months.
Exception: Do not reimburse health care premiums in the same month as a capitation payment to a Managed Care Organization (MCO) if a client failed to report information about other health care coverage while enrolled in an MCO.
Note: A one-month overlap for paying MCO capitation and cost effective insurance can be allowed for administrative purposes, such as obtaining necessary information and timing of enrollment.
Example:
Lila applies for MA for herself and her children in March and is approved eligible retroactively back to January. A cost effective review was requested but Lila did not return the paper work. Lila’s MA eligibility was closed.
Lila returns the cost effective referral information at the children’s MA renewal in July. The insurance is cost effective.
Action:
Reimburse premiums paid, according to reimbursement requirements, back to January if members were not enrolled in an MCO.
Example:
Erma applied for MA in June and failed to report her health insurance coverage. She was enrolled in an MCO in August. Erma later requests reimbursement for her premiums in the retro months.
Action:
Even though the policy is determined cost effective, do not reimburse premiums during the months for which a capitation has been paid to the health plan.
When issuing reimbursements:
l Verify payment of the monthly premium amount.
Note: Clients are required to report any changes regarding their cost effective health coverage. Verify changes in premium amounts when reported by the client and re-determine the cost effectiveness of the policy. See Cost Effective Health Coverage - MA, Changes in Cost Effective Coverage.
l Reimburse clients within 30 days of receiving verification of the premium payment. There is no requirement for reimbursement to occur the same month in which the premium is paid. If verification is not submitted until the end of the month, the client may be reimbursed the next month.
Note: County agency staff may make arrangements to pay premiums directly to the employer or the insurance provider on or before the due date after any initial reimbursements to the client.
l Pay only the portion of the premium that covers family members enrolled in MA.
Exception: Pay the portion of the premiums for people who are not active on MA if:
n Their enrollment in the insurance is a condition of the MA client’s enrollment in the insurance.
n The non-active MA person was not enrolled in the insurance at the time of health care application.
n The insurance remains cost effective for the MA client even if the premium for both the client and the non-active person is paid.
See Determining Cost Effectiveness, Premiums That May be Reimbursable for more information.
Example:
Sara is eligible for MA using the TEFRA option. She lives with her parents and her brother, none of whom receive MA. Her father has health insurance through his employer at no charge for the employee. The cost of dependent coverage for Sara, her mother, and her brother is $96 per month.
Action:
One-third of the cost of dependent coverage will be reimbursed to the family or paid directly to the provider because coverage for Sara is one-third of the cost of dependent coverage.
Example:
Mary and her two daughters are eligible for MA. Her husband John, the children's stepfather, does not receive MA. Mary has health insurance through her employer at a cost of $300 per month for Mary and all dependents. Mary would pay $30 for employee-only coverage. The insurance is determined to be cost effective.
Action:
Mary's share of the $300 premium is $30. The cost of dependent coverage for John and the children is $270. Each dependent’s share of the cost of the premium is $90 ($270 divided by 3).
Reimburse $210 of the premium to Mary or directly to the insurance provider ($30 for Mary’s share + $90 for each child).
Example:
Bill applies for MA for his two sons. He is not eligible for MA for himself. He has health coverage available through his employer at a cost of $50 for the employee and $100 for dependent coverage. He cannot enroll his sons in the health plan unless he also enrolls. The cost of the covered medical expenses for the year for his two sons exceeds the annual premium amount by a 2:1 ratio based on the $150 per month premium.
Action:
The insurance is cost effective. Pay the entire premium as cost effective coverage because the children cannot be enrolled in the health plan unless Bill enrolls.
Acceptable verification that the premium has been paid includes paycheck stubs or other employer or insurer verification. The verification submitted must clearly list the monthly premium amount and be from an official source (such as the employer or insurance company). Paycheck stubs are preferable as verification of the premium payment. However, if paycheck stubs are not available or do not clearly list the monthly premium amount or premium payment, other forms of employer or insurer verification may be accepted.
An MA client is eligible for cost effective reimbursement in the retroactive months if both of the following are met:
l The client meets all of the reimbursement requirements.
l The client is eligible for MA during the retroactive months.
When issuing a retroactive reimbursement:
l Verify the amount to be reimbursed and that it has been paid.
l Issue a check within 30 days of any of the following:
n The decision to approve MA.
n Approval of the cost effective insurance.
n Receipt of premium payment verification from the client.
Example:
Alan was laid off from his job in April. At that time he enrolled in COBRA coverage. He applies for health care in July and requests retroactive coverage back to April.
Action:
Determine if the COBRA coverage is cost effective. If the COBRA is cost effective and Alan is eligible for retroactive MA in April, May and June reimburse the COBRA premiums for the retroactive months after verifying they were paid.
Do not reimburse or pay premiums for children whose parents are court-ordered to provide medical support , unless the parent is also MA eligible.
Mail Order Prescription Drug Reimbursement
Some employer-sponsored and private health plans offer prescription drug benefits only through a mail order option. Mail order companies such as CareMark, ExpressScripts, and Merck-MedCo generally will not enroll as Minnesota Health Care Programs (MHCP) providers and will not bill enrollee co-payments to MHCP.
DHS may reimburse enrollees directly for out-of-pocket payments to a mail order company if the client does not have a retail pharmacy benefit option and all of the following conditions are met:
l The co-payments were not used to meet an MA spenddown
l The enrollee receives MA through fee-for-service .
Contact the Recipient Help Desk if an enrollee who receives MA on a fee-for-service basis has a mail-order only drug benefit with co-payments. The Help Desk will initiate a request to BRS to send the enrollee a letter with instructions about acceptable proof of payment.
Do not contact Benefit Recovery for enrollees who receive MA from managed care organizations (MCO). MCOs are prohibited from reimbursing clients for medical services. Refer the enrollee to the managed care plan for help with benefit coordination.
Reimburse the premiums paid for the following:
l Clients who have Medicare Part A determined cost effective.
Note: DHS pays the Part A premium directly to SSA through the automated Buy-In process if the client is active on QMB or QWD. No cost effective referral is required.
Send the premium payment directly to:
Medicare Premium Collection Center.
P.O. Box 790355.
St. Louis, MO 63179-0355.
l Clients who have Medicare Part B determined cost effective.
n Reimburse Part B premiums retroactive to the date of MA eligibility for MA enrollees who are eligible for payment of Part B premiums.
n Also reimburse Part B premiums for IMD residents who would be eligible for QMB or SLMB but for their IMD residence.
See the following references for more information on Medicare Premiums and cost effective coverage:
l Cost Effective Health Care Coverage - MA for information on cost effective requirements.
l Determining Cost Effectiveness for more information on Medicare Parts A, B, and C (Medicare Advantage) and Medicare Supplement insurance policies.
l Medicare Cost Effective Requirements for more information on Medicare Parts A and B.
l MMIS User Manual II-37 (Medicare) for instructions on billing DHS for county-reimbursed Medicare payments.