<p> Medicare Minute Teaching Materials – December 2016 Who Pays First: Medicare or Other Insurance?</p><p>1. When does current employee insurance pay primary? Medicare generally pays first for most people who have Medicare, but Medicare by law is the secondary payer in certain cases. Current employee insurance may pay primary to Medicare. Whether it will pay primary or not depends on how you are eligible for Medicare and how many people work at the company that provides the insurance. Insurance from your or your spouse’s current employment pays primary to Medicare if you:  Are eligible for Medicare because you are 65 or older and the company has 20 or more employees.  Are eligible for Medicare because you have received Social Security Disability Insurance (SSDI) payments for more than 24 months and the company has 100 or more employees.</p><p>Note that if you have Medicare because you have received SSDI payments for more than 24 months, the insurance based on current employment can also be from your family member’s current work. This is an important difference, because if you are eligible for Medicare due to age, the current employment-based coverage can only be from your or your spouse’s current work. </p><p>Insurance from current employment can be from a private company (such as a bank or small business), a union, or a Small Business Health Options Program (SHOP) plan, which is a type of current employee coverage available through the Health Insurance Marketplace. Insurance from current employment does not include COBRA or retiree coverage. 2. When do Federal Employee Health Benefits (FEHB) pay primary? If you or your spouse are currently working for the federal government and are covered by FEHB, the rules are the same as those discussed in question one. FEHB always pay primary to Medicare because the federal government has more than 100 employees. If you are a federal employee and you become eligible for Medicare, you will have an opportunity to make desired changes to your benefits beginning 30 days before you become Medicare-eligible. You may want to change your coverage depending on if you have decided to delay Medicare enrollment or not. For example, if you choose to enroll in Medicare Part B, then you may decide to enroll in an FEHB plan with a lower premium since you will be paying a premium for FEHB and Medicare. Unlike other types of retiree coverage (see question 5), retiree FEHB pays primary to Medicare if you are enrolled in premium-free Part A but not enrolled in Part B. </p><p>3. When does TRICARE insurance pay primary to Medicare? TRICARE is military insurance for active duty service members (ADSMs) and active duty family members (ADFMs). There are a number of different TRICARE plans that you or a family member can be enrolled in. TRICARE pays primary to Medicare as long as the person sponsoring the plan is an active duty service member. (TRICARE for retirees is explained in question 5.)</p><p>4. When does current employee insurance pay secondary? Insurance from your or your spouse’s current employment pays secondary to Medicare if you:</p><p>1  Are eligible for Medicare because you are 65 or older and the company has fewer than 20 employees.  Are eligible for Medicare because you have received SSDI payments for more than 24 months and the company has fewer than 100 employees. o Note that if you have Medicare due to disability, the insurance based on current employment can also be from your family member’s current work. </p><p>5. What other types of insurance pay secondary to Medicare? Retiree insurance pays secondary to Medicare, according to rules about how Medicare works with other insurance. Retiree insurance includes policies from a former employer or a union. In limited circumstances, some of these plans will choose to pay primary, but they are not required to do so. If the retiree plan pays primary, make sure you get this decision in writing. Also be aware that this policy can decide to stop paying primary at any time. Even if your retiree insurance decides to pay primary, you should still sign up for Medicare when you first become eligible. This is because you will not have a Special Enrollment Period (see question 9) to sign up for Medicare later if you do not sign up when you are first eligible. </p><p>FEHB pay secondary if you are retired and enrolled in Medicare Parts A and B.</p><p>TRICARE for Life (TFL) pays secondary to Medicare. TRICARE for Life is Medicare-wraparound coverage for TRICARE beneficiaries who have Medicare Parts A and B. When you are retired from the military and then become eligible for Medicare, you must sign up for Medicare in order to stay eligible for TRICARE benefits. Once you enroll in Medicare, you get your TRICARE benefits through TRICARE for Life. TFL pays second to supplement Medicare coverage. For services covered by Medicare and TFL, TFL should cover most Medicare deductibles, copays, and/or coinsurance charges. TFL pays first for services that TFL covers but Medicare does not, such as health care services received overseas. </p><p>COBRA continuation coverage pays secondary to Medicare. COBRA is a federal law that gives individuals the right to purchase continued health coverage under an employer’s plan for a limited period of time following termination of employment, divorce, death, or other circumstances that end coverage under the plan. If you enroll in COBRA after you are already enrolled in Medicare, then COBRA pays secondary. If you are already enrolled in COBRA and then you become eligible for Medicare, your COBRA coverage will likely end once you enroll in Medicare. </p><p>Medigaps pay secondary to Medicare. A Medigap policy is a standardized supplemental health insurance that pays for part of all of the Original Medicare cost-sharing gaps that you owe. Medigaps only work with Original Medicare. If you have a Medigap, then Original Medicare pays first and the Medigap pays second to cover some or all of your remaining costs for certain services. </p><p>6. How do Veterans’ Affairs (VA) benefits work with Medicare? Medicare pays for care you receive at any Medicare-approved facility, and VA benefits pay for care you receive at any VA facility. Exceptions can be made such as if you receive prior authorization from 2 the VA to receive VA-covered services at a Medicare-approved facility. If an emergency occurs that requires you to receive such care, the VA may cover some of those costs until you can be moved to a VA facility for continued care. </p><p>VA benefits cover certain services that are not covered by Medicare, such as nursing home care. If eligible, you can use your VA benefits for these services instead of seeking coverage from another source. Call the U.S. Department of Veteran Affairs at 1-800-827-1000 for information on Veteran's benefits and services in your area.</p><p>7. What are the rules for how Medicare works with other insurance if I have End-Stage Renal Disease (ESRD)? If you have Medicare due to ESRD, then the rules for who pays first are based on your 30-month coordination period. The 30-month coordination period begins when you first enroll in Medicare based on ESRD, or the first month that you would have qualified if you had applied for Medicare ESRD benefits. </p><p>Medicare pays secondary to your other coverage if you are still within your 30-month coordination period. Medicare pays primary to your other coverage after the 30-month coordination period. </p><p>In this case, the coverage can be from a current or former employer, including COBRA benefits. Who pays first depends on the 30-month coordination period instead of your current employment status. </p><p>8. If I’m already covered by another insurance, do I have to enroll in Medicare Part B? Deciding to delay Part B enrollment depends on a number of factors. Some people may want to delay Medicare Part B enrollment because they already have coverage from another source, and they do not want to pay the Part B premium on top of what they already pay for their other coverage. It’s important to determine whether or not a delay will result in a Part B late enrollment penalty. </p><p>Before delaying Part B enrollment, you should consider the following questions. 1. Will I have a Part B Special Enrollment Period (SEP) to sign up for Medicare later? If you are entitled to a Part B SEP, you will be able to enroll in Part B outside of your Initial Enrollment Period (three months before, the month of, and three months after your 65th birthday month). You will also be able to enroll in Part B during the General Enrollment Period (January 1 through March 31 each year, with coverage becoming effective July 1). If you have a Part B SEP, then you will not have a late enrollment penalty for delaying Part B enrollment. (See question 9 for more details.) 2. Will my other coverage pay primary or secondary to Medicare? If your other health insurance coverage will pay secondary to Medicare, then it is usually not advisable to delay Medicare enrollment. Secondary insurance may take back any payments that it has made or refuse to make future payments on health care costs until you enroll in Medicare. </p><p>9. What is the Part B Special Enrollment Period (SEP)? The Part B SEP spans the time that you are covered by insurance from your, your spouse’s, or in some circumstances, your family member’s current work. You have this SEP while you are covered by insurance from current work, and it extends for eight months after the coverage or work ends, 3 whichever is sooner. This SEP only applies to insurance from current work. If you have access to this SEP, then you will not have a late enrollment penalty for delaying Part B enrollment.  Note that if you have Medicare due to disability, the employer offering the health insurance must have 100 or more employees in order for you to qualify for the Special Enrollment Period.</p><p>You will not get this SEP if you delay Medicare enrollment while covered by retiree insurance from a former employer, COBRA, or retiree FEHB. If you delay Medicare enrollment while covered by any of those types of insurance, you will have to wait for the General Enrollment Period (January 1-March 31 each year; coverage becomes effective July 1) to enroll in Medicare and you will likely have a late enrollment penalty. This SEP also doesn’t apply to people with Medicare due to ESRD.</p><p>10. If I delay Part A enrollment, do I need an SEP to sign up later? If you are eligible for premium-free Part A because you or your spouse worked more than 10 years in the United States, then you can sign up for Part A at any time and will not have a late enrollment penalty for delaying enrollment. If you are not eligible for premium-free Part A, then you will need to think carefully before delaying Part A enrollment. If you delay premium Part A enrollment, then you can only sign up for Part A for the first time if you have an SEP. If you are covered by insurance based on current work, then you can use the Part B SEP (see question 8) to sign up for premium Part A as well. If you do not qualify for the SEP, you will likely have a late enrollment penalty (see question 11) for delaying premium Part A enrollment. You will have to wait for the General Enrollment Period to enroll in premium Part A. </p><p>11. How do I decide if I should delay Medicare Part D enrollment? Delaying Part D requires different decisions than delaying Part A and/or Part B. If you are thinking about delaying Part D enrollment, you should consider the following questions: 1. Is my current drug coverage creditable? Creditable drug coverage is coverage whose value is equivalent to basic Medicare Part D coverage. If your current drug coverage is creditable then you can delay Part D enrollment without penalty. You should receive a notice around September of each year informing you if your prescription drug coverage is creditable. If you have not received this notice, you should contact your human resources department, drug plan, or benefits manager. FEHB, TRICARE, and VA benefits drug coverage are all considered creditable, but you should still keep a written notice for your records. 2. Will I have a Part D (SEP) to sign up for Medicare later? You will have an SEP to sign up for Medicare later if you lose employer-based coverage (either current employee or retiree drug coverage). You are also eligible for an SEP if you lose creditable drug coverage through no fault of your own. Both of these SEPs last for up to two full months after the month that you lose your drug coverage. If your coverage was creditable, then you will not incur a Part D late enrollment penalty (see question 11). </p><p>11. How are Medicare late enrollment penalties (LEPs) calculated? The Part A LEP only applies if you do not qualify for premium-free Part A. If you delay premium Part A enrollment for over a year, you will have a late enrollment penalty of 10% of the annual Part A premium. It lasts for twice the amount of time that you were eligible for premium Part A but did not 4 enroll. For example, if you delayed premium Part A enrollment for two years, you would have the Part A LEP for four years. The Part B LEP is 10% of the annual Part B premium for each 12-month period you were eligible for Part B but did not enroll. If you are eligible for Medicare because you received SSDI payments for more than 24 months, then your Part B LEP will go away when you become eligible for Medicare due to age. If you are eligible for Medicare because you are 65 or older, then you will have to pay the Part B LEP for the rest of your life. The Part D LEP is1% of the national average Part D premium for each month you were eligible for Part D and did not enroll or have creditable drug coverage. If you are eligible for Medicare because you received SSDI for more than 24 months, than your part D LEP will go away when you become eligible for Medicare due to age. If you are eligible for Medicare because you are 65 or older, then you will have to pay the Part D LEP for the rest of your life. </p><p>12. Do I need to tell my doctor if I have more than one type of insurance? You should inform your doctor about the different insurance that you have in order to avoid any billing or coverage problems. You can do this by showing your different health insurance cards at the front desk so that your file is up to date. It is important to let your providers know which insurance is primary and which is secondary so that there are no problems. If your secondary insurance is billed first, for example, you may experience coverage denials or other difficulties accessing services because your secondary insurance will not pay until the primary insurance does. </p><p>13. What resources are available to help me understand my options and make good decisions?  Social Security Administration: If you have other insurance, learn how it works with your Medicare coverage. Before delaying Medicare enrollment, speak with the Social Security Administration (800-772-1213) and consider your options carefully.  Benefits Coordination and Recovery Center (BCRC): If you have questions about how your other insurance works with Medicare, you can contact the Benefits Coordination and Recovery Center (BCRC) at 855-798-2627 (TTY/TTD: 855-797-2627).  State Health Insurance Assistance Program (SHIP): Contact your local SHIP for personalized, one-on-one counseling and assistance with understanding how Medicare works with your other insurance, including how to avoid late enrollment penalties. The national SHIP mission is to empower, educate, and assist Medicare-eligible individuals, their families, and caregivers through objective outreach, counseling, and training, to make informed health insurance decisions that optimize access to care and benefits. See the last page for SHIP program contact information  Senior Medicare Patrol (SMP): If you receive bills for health care services that you think should have been covered by Medicare or your other insurance, contact your local Senior</p><p>Medicare Patrol (SMP) for education and assistance regarding suspected Medicare fraud, errors, or abuse. The national SMP mission is to empower and assist Medicare beneficiaries, their families, and caregivers to prevent, detect, and report health care fraud, errors, and abuse through outreach, counseling, and education. See the last page for SMP program contact information.</p><p>5 SHIP Case Study Nancy is 64 years old and receives retiree FEHB based on her former work for the federal government. She is eligible for premium-free Part A and wants to know if she should sign up for Part B when she turns 65. Her friends have given her different advice, and she is not sure what decision to make. </p><p>What should Nancy do?  Nancy should contact her SHIP. o If she doesn’t know how to find her SHIP, she can go to www.shiptacenter.org or call 1-877-839-2675 for assistance.  A SHIP counselor can explain Nancy’s options.  Option 1: If Nancy enrolls in premium-free Part A but not in Part B, her retiree FEHB will pay primary. The SHIP counselor should be sure that Nancy understands that: o She will continue to pay a premium for her retiree FEHB. o She will have a late enrollment penalty if she delays Part B enrollment and then decides to enroll later. . The SHIP counselor can also let Nancy know that some people keep their FEHB as primary and never enroll in Part B.  Option 2: Nancy can enroll in Part B when she turns 65 and avoid a late enrollment penalty. Her FEHB will pay secondary and she will pay a premium for Part B and her FEHB.  The SHIP counselor can help Nancy decide what her best option is. Nancy should consider her health needs and financial situation before deciding whether or not to enroll in Part B. </p><p>SMP Case Study Ted has a Medicare Advantage Plan with and retiree insurance. His retiree insurance usually pays second for the portion of his physical therapy costs not covered by his plan. Recently, however, he has been getting a bill from his provider for a portion of his costs after his Medicare Advantage Plan pays. Ted doesn’t understand doesn’t understand why he is being billed.</p><p>What should Ted do?  Ted should contact his provider to verify the insurance they have on file for him.  If Ted isn’t able to work this out with his provider, or if he is suspicious of suspected billing fraud, errors, or abuse, Ted can contact the Senior Medicare Patrol. o If Ted doesn’t know how to find his local SMP, he can go to www.smpresource.org or call 1-877-808-2468 for assistance.  The SMP representative will collect clarifying information in order to help Ted resolve his billing issue.  If fraud or abuse is suspected based upon the information collected, the SMP will report the situation to the proper authorities, continuing to advise Ted about how to respond to the bills he is receiving from his provider.  The SMP representative will also educate Ted about how to protect himself from other types of fraud or abuse. 6 Local SHIP contact information Local SMP contact information</p><p>SHIP toll-free: SMP toll-free:</p><p>SHIP email: SMP email: SHIP website: SMP website: To find a SHIP in another state: To find an SMP in another state: Call 877-839-2675 or visit www.shiptacenter.org. Call 877-808-2468 or visit www.smpresource.org.</p><p>The production of this document was supported by Grant Numbers 90ST1001 and 90NP0003 from the Administration for Community Living (ACL). Its contents are solely the responsibility of the SHIP National Technical Assistance Center and Senior Medicare Patrol National Resource Center and do not necessarily represent the official views of ACL.</p><p>7</p>