Operational Policy Letter: Transition from 1876 Risk Members to Medicare+Choice Plans

Summary:

Any individual who was enrolled in a § 1876 risk plan effective December 1, 1998 or earlier and remained effective with the risk plan on December 31, 1998 automatically continued to be enrolled in the M+CO on January 1, 1999. This OPL provides responses to common questions regarding specific types of grandfathered members, namely, those with only Medicare Part B, those who live outside of a M+C plan's service area, and those who have ESRD. The OPL also responds to questions regarding when these grandfathered members may enroll in other M+C plans, and how and when these members must be disenrolled from M+C plans.

This information contained in this OPL is based on the requirements outlined in the Medicare+Choice Interim Final Rule (IFC) published in the Federal Register on June 26, 1998. Any changes in requirements that may result from public comments received on the IFC will be outlined in the Final Rule (to be published by HCFA later this year) and may result in additional clarification in another OPL as necessary.

Policy:

Part B-Only, ESRD, and Out-of-Area Grandfathered Members

Question 1:

Can an out-of-area, Part B-only, or ESRD member who was grandfathered into a M+C plan on 1/1/99 enroll in any other M+C plans after 1/1/99?

Answer:

The Part B-only and ESRD grandfathered members may enroll in other M+C plans, but only if the plans are in the same M+CO and if they meet other M+C eligibility requirements.

The out-of-area grandfathered individuals may move from M+C plan to M+C plan within the same M+CO if they meet other M+C eligibility requirements. Assuming they meet other M+C eligibility requirements, the out-of-area grandfathered individuals could also apply for membership in any M+C plan whose service area is within the area in which the individual resides.

For definitions of "M+C Organization" and "M+C Plan," refer to the Medicare +Choice regulation (HCFA-1030-IFC) published in the Federal Register on June 26, 1998.

Question 2:

What happens if out-of-area, Part B-only ESRD grandfathered members disenroll from the M+CO?

Answer:

If the Part B-only or ESRD grandfathered members disenroll from the M+CO (i.e., they switch to Medicare fee-for-service), they will not be eligible to enroll in any M+C plan in any M+CO until or unless they meet all M+C eligibility requirements, including but not limited to, that of being entitled to Medicare Part A and not having ESRD.

If the out-of-area grandfathered members disenroll from the M+CO (i.e., they switch to Medicare fee-for-service or enroll in another M+CO), they will only be able to enroll in other M+COs if they meet all M+C eligibility requirements, including, but not limited to, that of living in the service area of the M+C plan.

Part B-Only Grandfathered Members

Question 3:

If a member of a commercial health plan became entitled to Medicare Part A on January 1, 1999, did s/he have to be enrolled in Part B on January 1, 1999 in order to convert to the Medicare product (i.e., M+C plan) in the same organization?

Answer:

Yes. Any individual enrolling into a M+C plan with an effective date of January 1, 1999 or later must meet M+C eligibility requirements, including entitlement to Medicare Part A and enrollment in Medicare Part B. The only exception is for individuals with ESRD who, if they meet all other eligibility requirements (including entitlement to Medicare Part A and enrollment in Medicare Part B), may convert to the M+C plan when aging-in to Medicare from the commercial plan in the same organization (as stated at 42 CFR 422.50(a)(2)) even though they have ESRD.

In addition, for enrollments with effective dates of January 1, 1999 or later, M+C eligibility requirements are met based on Part A entitlement through Medicare and not through the purchase of Part A-equivalent benefits through the M+CO. The M+CO may refer individuals to the Social Security District Office if they wish to enroll in Medicare Part A in order to be eligible to enroll in a M+C plan.

Question 4:

What are the situations in which a Part B-only grandfathered member must be disenrolled after January 1, 1999?

Answer:

A M+CO must disenroll a Part B-only grandfathered member if:

• the member permanently moves to an area that is out of the service or continuation area; or,
• the member permanently moves into the continuation area, but does not choose to continue enrollment; or,
• the member dies; or,
• the M+CO terminates its contract with HCFA, with respect to all M+C individuals who live in the area where the individual resides or if the M+C plan is terminated, or if the service area or continuation area is reduced; or,
• enrollment in Medicare Part B ends for the member.

ESRD Grandfathered Members

Question 5:

Were members of a § 1876 risk plan that converted to a M+C plan on January 1, 1999 allowed to remain in the M+C plan even if they have ESRD?

Answer:

Yes. As with all other members of the '1876 risk plan, if they were enrolled in the plan effective December 1, 1998 or earlier and remained effective with the risk plan on December 31, 1998, then they automatically continued to be enrolled in the M+CO on January 1, 1999.

Question 6:

What are the situations in which an ESRD member must be disenrolled after January 1, 1999?

Answer:

As outlined at 42 CFR 422.74(b)(2), and as with any non-grandfathered member, a M+CO must disenroll an ESRD member if:

• the member permanently moves to an area that is out of the service or continuation area; or,
• the member permanently moves into the continuation area, but does not choose to continue enrollment; or,
• the member loses entitlement to either Part A or Part B; or,
• the member dies; or,
• the M+CO terminates its contract with HCFA, with respect to all M+C individuals who live in the area where the individual resides or if the M+C plan is terminated, or if the service area or continuation area is reduced.

Out-of-Area Grandfathered Members

Question 7:

Were members of a § 1876 risk plan that converted to a M+C plan on January 1, 1999 grandfathered into the plan like the Part B-only members, even if they did not live in the M+C plan service area or M+CO continuation area?

Answer:

Yes, any individual who was enrolled in a § 1876 risk plan effective December 1, 1998 or earlier and remained effective with the risk plan on December 31, 1998 automatically continued to be enrolled in the M+CO on January 1, 1999.

Question 8:

What are the situations in which out-of-area grandfathered members must be disenrolled after January 1, 1999?

Answer:

A M+CO must disenroll an out-of-area grandfathered member if:

• the member loses entitlement to either Part A or Part B; or,
• the member dies; or,
• the M+CO terminates its contract with HCFA; or,
• the member permanently moves to an area that is out of the service or continuation area. In other words, while the member was living out of the service or continuation area at the time s/he was grandfathered into the M+C plan, a subsequent permanent move into an area that is not in the service or continuation area is grounds for disenrollment; or,
• the member permanently moves into the continuation area, but does not choose to continue enrollment.

Expiration Date: December 31, 1999

This OPL was prepared by the Center for Beneficiary Services Last Updated March 6, 1999