01/14/2009
New Medicare Secondary Payer (MSP) law impacts collection of group, member data
The new Medicare Secondary Payer law is a complex one that involves many details. While the law itself will not change, the
compliance requirements that CMS imposes upon carriers may be subject to revision. The information below about how Asuris is
preparing to comply with the law is current as of today, based on what CMS has told us as of today. If CMS changes compliance
requirements, we will have to make changes to the processes described below. Please consider the information below to be
final, unless you hear differently from us in the coming weeks.
Starting Jan. 1, 2009, all medical carriers in the United States are required to report specific group and member information
to the Centers for Medicare & Medicaid Services (CMS) on a quarterly basis. In order to best comply with the new law, Asuris
will collect and report the following data:
- Social Security number for each active covered group member we serve, which includes employees and all dependents
- Work status for each employee (e.g., actively employed or inactive, which includes COBRA or retired employees)
- Employer tax identification numbers (TIN or EIN)
- Group size, as defined by Medicare's OBRA and TEFRA/DEFRA regulations
This new law is described in detail on the CMS Web site.
The law requires us to report on people over age 55 and those under age 55 who have Medicare. It is easy to identify those
eligible for Medicare due to age and End Stage Renal Disease (ESRD), but it is impossible to identify all members who have a
disability. The best way to ensure that we don't miss anyone is to obtain SSNs for all members, regardless of age, and report
them to CMS.
We currently don't require member SSNs, but we get the SSNs for most employees and dependents during the enrollment or
renewal process. When we don't get an SSN we assign an alternate identification number. CMS has always double–checked
the SSNs that carriers were able to provide for coordination of benefits purposes. Still, they found that they were losing
more than $2 billion per year due to inaccurate coordination of benefits. For this reason, starting Jan. 1, 2009, we are
providing SSNs for 100% of our impacted group members to help CMS accurately determine coordination of benefits.
Since Medicare is not limited to those 65 or older, age alone does not indicate whether someone has Medicare. That's why we
need to report dependent SSNs along with employee SSNs. And since group size and employee status can also direct coordination
of benefits, CMS is asking for that information as well.
When a member has both Medicare and group coverage, Medicare Secondary Payer (MSP) laws determine whether Medicare or the
group coverage should pay first. But if CMS doesn't know about a Medicare member's group coverage, Medicare may incorrectly
pay first or be the only plan that pays. In fact, in many cases, the group coverage should pay first.
When Medicare covers medical expenses that group plans should cover, it can add up to a lot of extra money. With health care
costs on the rise and the Medicare population growing so rapidly, CMS is understandably committed to ensuring that all
Medicare money is spent appropriately. That's why they want to make sure that Medicare and group coverage are paying for care
in the correct order.
Timeline
We need to receive the following information by the middle of February 2009:
- The SSNs of all members (employees and dependents) with effective dates of Jan.1, 2009, and after
- The SSNs of all employees with effective dates prior to Jan. 1, 2009
- Group size as defined by Medicare's OBRA and TEFRA/DEFRA regulations
- Group EINs/TINs
We need to receive the following by the middle of February 2011:
- The SSNs of all dependents with effective dates prior to Jan. 1, 2009
How will Asuris comply with the new law?
Starting immediately, we will require each new group to provide, upon new enrollment, the following information:
- All employee and dependent SSNs
- Group federal tax identification number
- Group size as defined by Medicare's OBRA and TEFFRA/DEFRA regulations
In addition to the information listed above, we will also report to CMS each employee's work status according to the
classification we assign upon renewal or enrollment.
The Group Master Application for our “Still Available" products allows for groups to specify their OBRA and TEFRA/DEFRA
status but does not currently require this information for renewing groups. This form will be modified to require this
information. New forms should be available in the first quarter of 2009. The Group Master Application for EmbarkSM,
VantageSM, MotivateSM and Asuris HSA Healthplan 2.0SM will not change, as it already collects the required information.
Until new forms are available, please use our existing forms and do your best to ensure the Federal Mandates portion of your
groups' master applications are complete and SSNs are filled in for new enrollments. We will soon begin the process of
collecting any missing information for those new groups that have already enrolled for 2009. We will continue with this
clean–up phase of new groups until new forms are available.
As you enroll new groups, please be aware that we will need to collect the information described above. In particular, we
expect to have to collect group size for all groups and member SSNs for all products, as this information is not routinely
required on our current forms. If the information is not provided on the application, your sales representative will contact
you to obtain it.
Starting Jan. 1, 2009, current groups will have to provide the same information listed above. (One exception: Medicare has
granted a 12–month reprieve for collecting the SSNs of dependents.) If our databases do not already have the necessary
information, we will ask the groups and/or members to provide it.
Starting in early 2009, all groups will receive a letter that explains the MSP law, describes the information that is
required and outlines the timeline and procedures we have established for collecting that information. Groups of 2 to 99 will
be asked to provide their group size as defined by Medicare's OBRA and TEFRA/DEFRA regulations. We will not ask for group
size from groups of 100+ as we already have that information. Any group, regardless of size, will also receive a roster of
any employees for whom we need an SSN, along with a request to provide us with the SSN.
If your groups have open enrollment changes, please ask that they provide SSNs for all employees and their dependents. We
will be required to report on people over age 45 and those under age 45 who have Medicare starting in January 2011. We will
begin collecting them in the spring of 2010 with a second letter to groups. Groups should not be surprised by that second
request, however. The first letter we send will explain the needed information and tell them when we will be asking for it.
If a group is unable to provide dependent SSNs, we will then turn to the members themselves. The deadline for this
information is February 2011.
What if a group or member does not comply?
We understand that many people rightfully protect their SSNs. There are a number of points that groups and members should
understand if they are reluctant to provide an SSN:
- Provision of SSNs is required by federal law.
- Reporting eligibility for Medicare will not impact a member's eligibility for group coverage. Federal law prohibits
groups from dropping or changing a member's coverage due to Medicare eligibility.
- We fiercely protect our members' personal information. We have in place all HIPAA–required security measures that
ensure the safety of our members' data.
- We don't use SSNs to identify members externally. Instead, for claims, coverage and identification purposes, we give
members alternative identification numbers.
- We give the SSNs to CMS only.
- If the information is not provided, we may not enroll the member. However, some situations may be handled on a
case–by–case basis.
- If we fail to comply with the law, we can be fined $1,000 for each day of non–compliance for each individual whose
required information is missing. If failure to comply is due to our own negligence, the fine is our responsibility. If our
failure to comply is a result of a group or member refusing to provide required information, we may ask the group to share
responsibility for the expense.
What are we asking our agents and Sales team to do?
Your assistance is vital as we work to comply with this new law. We will start collecting required data immediately for new
groups enrolling Jan. 1 or later.
When you enroll new groups, please make sure that all required information is provided. If a group or member is reluctant to
provide data, please explain why the information is required, describe our security measures and clearly communicate what the
consequences will be if information is withheld.
Many groups may be unsure about their group size. Please assist groups in identifying their group size as defined by
Medicare. (Generally, a group's size is determined by the number of employees for whom the group pays FICA taxes, but there
are exceptions to this rule. The group should refer to the OBRA and TEFRA/DEFRA regulations for additional guidance.) Since
group size can change over time, we will request this information periodically to make sure we are reporting current data to
CMS.
See, also, a FAQ that covers many questions
groups and members may ask.
If you have questions, please contact your local Asuris Sales
contact.
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