TN 23 (04-01)

A. BACKGROUND – 1986 AMENDMENTS

1. MSP Provisions for the Disabled

Under section 9319 of PL. 99-272, Medicare became the secondary payer for the disabled active individual who was covered under his/her own or any family member's LGHP. An “active individual” was an employee, an employer, a self-employed individual (such as the employer), an individual associated with the employer in a business relationship or a member of the family of any of these persons.

Often, the disabled person was the family member of the employee, employer, or individual associated with the employer in a business relationship. This meant that a disabled person who was covered under the LGHP of a spouse, parent, or any other family member was considered to be an active individual even though the disabled individual was not actually the worker.

2. SEP for the Disabled

For enrollments and reenrollments that occurred between 1/87 and 8/9/93, the SEP for a disabled beneficiary began:

• the first month he/she was no longer covered under an LGHP as an active individual (or the LGHP no longer met the definition in HI 00805.266A.3, and

• one of the requirements in HI 00805.270 was met.

3. Premium Surcharge Rollback

• Effective for premiums due for 1/87 and later, the calculation of the premium surcharge for late enrollment excluded:

• those months beginning 1/87 (or the end of the IEP, if later) during which the individual could demonstrate he/she was enrolled as an active individual in an LGHP, and

• all months of SMI enrollment.

B. BACKGROUND – 1989 AMENDMENTS (Disabled Individuals Covered Under a GHP)

1. SEP Provision Amended

The SEP provisions were expanded for enrollments occurring in or after 7/90, so that disabled individuals covered under their own or a spouse's GHP based on current employment are also eligible for the SEP, although Medicare is the primary payer. Thus, the SEP requirements for the disabled became the same as those for the aged.

2. Premium Surcharge Rollback

Effective for premiums due for 7/90 and later, the calculation of the premium surcharge for late enrollment excludes:

• all months beginning 1/87 (or the end of the IEP, if later) during which the individual can demonstrate he/she was enrolled in a GHP based on his or her own or a spouse's current employment, and

• all months of SMI enrollment.

C. BACKGROUND – 1993 AMENDMENTS

Section 13561 (e) of P.L.103-66 abolished the concept of “active individual” and modified the Medicare secondary payer (MSP) provision for the disabled to conform to the MSP provision for the working aged.

1. MSP for the Disabled

Beginning 8/10/93, Medicare is the secondary payer for the disabled individual who has LGHP coverage on the basis of his/her own or a family member's current employment status. An individual has “current employment status” with an employer if the individual is working as an employee, is the employer (including self-employed persons), or is associated with the employer in a business relationship.

2. SEP Provision Amended

Effective for enrollments and reenrollments that occurred 8/10/93 through 2/95, the SEP began:

• as soon as a disabled beneficiary was no long covered under an LGHP by reason of his/her own current employment status or the current employment status of a family member, or when the LGHP was no longer considered a “large” plan as defined in HI 00805.266 A.3., and

• one of the requirements in HI 00805.270 was met.

These amendments did not change the requirements for an SEP for the disabled beneficiary covered under a GHP (a plan of any size below 100 employees) based on his/her own current employment status or the current employment status of a spouse (see HI 00805.275).

These requirements also applied to the disabled individual enrolling in Premium-HI for the Working Disabled under section 6012 of P.L. 101-239.

D. REFERENCES

• See HI 00805.275 for enrollment requirements beginning 3/95.

• See HI 00805.300 for the SEP for disabled individuals whose LGHP coverage is not based on current employment status.