Operational Policy Letter: Transition from 1876 Risk to Medicare+Choice Enrollment and Disenrollment Policies

Summary:

As § 1876 risk plans fully transition to Medicare+Choice (M+C) plans, some adjustment in enrollment and disenrollment policies is necessary to accommodate the transition from § 1876 rules to M+C rules. Some of these transitional policies are covered in other OPLs, namely OPL 73 (notification to Part B-only grandfathered members) and OPL 74 (effective dates). This OPL responds to questions regarding transitional policies for disenrollment for nonpayment of premiums and disenrollment after a member leaves the service area.

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:

Disenrollment for Nonpayment of Premiums

Prior (§ 1876) Rules: A risk plan may automatically downgrade membership due to nonpayment of required premiums, other charges imposed for Medicare deductible and coinsurance amounts, or other charges for mandatory supplemental benefits for which the member is liable. The plan may also disenroll the member for these reasons after proper advance notification (42 CFR 417.460(c) and HMO/CMP manual § 2004.2).

M+C Rules: After proper advance notification a M+CO may disenroll a member for nonpayment of basic and supplemental premiums or downgrade membership with a member's written consent (42 CFR 422.74(b)(1)(i) and 422.74(d)). (Note: additional direction regarding M+CO procedures for nonpayment of premiums will be provided in a separate OPL).

Transitional Rules: An organization must follow '1876 rules with respect to any premiums that were delinquent on or before 12/31/98. Any premium that is considered by the M+CO to be delinquent on or after 1/1/99 must be handled according to M+C rules (additional direction regarding M+CO procedures for nonpayment of premiums will be provided in a separate OPL).

Disenrollment When a Member Temporarily Leaves the Service Area
(Note: instructions on M+CO disenrollment procedures for permanent moves and procedures when a member moves into a continuation area will be provided in a separate OPL).

Prior (§ 1876) Rules: A plan must disenroll members who permanently move out of the service area. A plan must also disenroll a member who leaves the service area for more than 90 days unless a visitor's program is in place. If a plan has a visitor's program, the member must be disenrolled after being out of the service area for over 12 months (42 CFR 417.460(f) and OPL #42).

M+C Rules: As with § 1876 rules, a M+CO must disenroll members who permanently move out of the service area, unless a member moves into and chooses a continuation of enrollment (42 CFR 422.74(b)(2)(i), 422.74(d)(4)(i), and 422.54). A M+CO must also disenroll members who leave the service area for over 12 months (42 CFR 422.74(d)(4)(i) and OPL #76), with the exception of those members living out of the service area who were grandfathered into the plan on 1/1/99.

Transitional Rules: M+COs may follow one of the two options outlined below for any member who left the plan's service area on or prior to 12/31/98. M+COs must follow M+C disenrollment rules and may not follow § 1876 rules with respect to any member who leaves the plan's service area on or after 1/1/99. (Note: additional instructions on M+CO disenrollment procedures for permanent and temporary moves will be provided in a separate OPL).

M+COs must choose only one option and apply it consistently with all members:

1. Follow § 1876 rules; or,
3. Begin following M+C rules, i.e., disenroll the member from the M+C plan after 12 months have passed. In this case, the 12 months will begin the month in which the member initially left the service area (in 1998).

Expiration Date: December 31, 1999

This OPL was prepared by the Center for Beneficiary Services