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Effective: December 1, 2006 |
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15.10.05ar1 - MA and GAMC Cost-Effective Insurance (Archive) |
Archived: October 1, 2008 |
MA and GAMC do not have insurance barriers to eligibility. However, the programs do have certain requirements that must be met for a client to have current health insurance concurrently with MA or GAMC.
More information on cost-effective coverage can be found in the following sections:
l Steps in a Cost-Effective Determination.
What is Cost-Effective Coverage?
Medicare Cost-Effective Requirements
What is Cost-Effective Coverage?
Cost-effective coverage is health insurance coverage which provides services at a lower premium than the costs DHS would incur if the client was not enrolled in the coverage.
In general, clients who have or are eligible for cost effective coverage must maintain or enroll in that coverage to be eligible for MA or GAMC.
County agencies must directly pay premiums or reimburse clients for cost-effective health insurance. DHS then reimburses the county for cost-effective premiums paid.
Exception: Clients choosing to continue to pay the premium to have it applied to his or her medical spenddown will not receive reimbursement.
Note: When the policy holder and dependents are covered by the cost-effective health care plan but are not all MA recipients, prorate the premium to determine what portion of the premium is reimbursable.
Example:
Orelia is covered by an HMO through her employer. She pays a $25 premium each month. Orelia applies for MA and is eligible without a spenddown. She receives $400 of prescriptions each month.
Action:
Orelia must continue her HMO coverage in order to maintain MA eligibility. The cost of maintaining her insurance coverage is less than the cost DHS would pay to cover her prescriptions. She may choose to either:
l Continue to pay her premium each month and receive reimbursement.
l Have the MA program pay her premium directly to her insurance provider.
Clients must cooperate in determining the cost-effectiveness of any health insurance they have or any group health plan for which they may be eligible. Clients must:
l Provide information about the plan.
l Complete the Health Insurance Premium Cost-Effectiveness Review Form (DHS-2841).
Contact the DHS Benefit Recovery Section (BRS) if the client indicates he or she is unable to use the cost-effective coverage because there are no providers for that coverage in the area.
Clients already eligible for or enrolled in a cost-effective group health plan must enroll or remain enrolled to be eligible for MA or GAMC.
l Adults who disenroll from a cost-effective group health insurance plan are ineligible for MA or GAMC until the next open enrollment period for the cost-effective group plan, unless they are allowed to enroll in due to a special enrollment. They must re-enroll at that time to reestablish eligibility.
l Adult applicants who disenroll from a cost-effective group health insurance plan prior to application may be eligible.
n The client must contact the employer to inquire about a special enrollment period.
Note: The special enrollment period allows enrollment into health plans in specific circumstances.
n If a special enrollment period is available require the client to enroll in the cost-effective plan.
n If a special enrollment period is not available, continue eligibility and track for the next open enrollment period. Require the client to enroll in the cost-effective plan at that time.
l Do not deny or close eligibility for children whose parents or other caretakers refuse or fail to maintain enrollment in cost-effective plans.
l Require applicants or enrollees who are eligible to continue group health plan coverage through COBRA to cooperate with cost-effective insurance requirements.
Example:
Auggie’s dad provides his insurance. His dad lives in New Mexico and the provider only supplies coverage in that state.
Action:
Contact BRS regarding Auggie’s policy. Continue his eligibility.
Medicare Cost-Effective Requirements:
l Require applicants or enrollees who are eligible for Medicare Part B to enroll or remain enrolled in Medicare Part B. A cost-effective review is not necessary.
Exception: Make a cost-effective referral if either of the following occur:
n An increased premium is assessed due to late enrollment.
Exception: For MA-EPD clients, do not refer to BRS if an enrollee’s income is greater than 200% FPG. Do not count spousal income in this determination.
n The client would be terminated from a group health insurance plan if enrolled in Medicare Part B.
l It is not necessary to review Medicare Part A for cost-effectiveness for people eligible for it at no cost.
l Clients eligible for MA and Medicare Part C (Medicare Advantage) and who are disabled may cancel their Medicare Part C even if it is determined to be cost-effective. The client must then enroll in Medicare Part D.
Note: An enrollee who chooses to continue Medicare Part C, will not have any cost-sharing expenses required for Medicare Part D covered drugs paid by MA.
l Clients eligible for MA and Medicare, whether disabled or age 65 or over, may cancel non-Medicare group health insurance, with or without prescription drug coverage, regardless of whether that coverage is cost-effective, without penalty. The client must then enroll in Medicare Part D.
Note: An enrollee who chooses to continue non-Medicare group health insurance, will not have any cost-sharing expenses required for Medicare Part D covered drugs paid by MA.
Refer enrollees to their insurance products’ benefit administrators if they have questions about whether they should keep or drop their current coverage. Enrollees should learn about all the implications before they make this decision.
If MA or GAMC ends, notify the client that MA/GAMC will no longer pay premiums on the cost-effective policy. Use the appropriate MAXIS SPEC/LETR.
See TEMP manual TE02.13.48 (Cost Effective SPEC/LETR) for more information on using MAXIS SPEC LETR to notify clients of decisions on cost-effective health insurance payments.
People whose MA or GAMC ends will receive a Certificate of Creditable Coverage (COCC) automatically two months after closure. If the former enrollee needs the COCC sooner, request one following your agency’s procedures.