TN 23 (04-01)

A. BACKGROUND – SEP PROVISION ENACTED

Section 2338 of P.L. 98-369 provided for a special enrollment period effective1/84. In addition, months effective 1/83 when Medicare became the secondary payer of benefits were excluded from the calculation of any SMI premium surcharge for premiums payable beginning 9/84. The SEP and premium surcharge relief provisions were also applied to Premium-HI under the same conditions in effect for SMI.

B. BACKGROUND – SEP REQUIREMENTS WHEN SMI WAS NOT ELECTED IN IEP

Under section 2338 of P.L. 98-369, the individual described in HI 00805.740 was eligible for one SEP if he/she:

• was covered by a GHP based on current employment when first eligible for SMI; and

• was covered by HI and a GHP during one or more months after being first eligible for SMI.

C. BACKGROUND – SEP REQUIREMENTS WHEN SMI WAS ELECTED IN IEP

The individual described in HI 00805.740 was eligible for more than one SEP if he/she:

• enrolled in SMI during the IEP, but later terminated SMI when covered under a GHP based on current employment;

• was covered by a GHP based on current employment during each month after the IEP during which he/she did not have SMI; and

• was covered by both HI and a GHP during one or more months after SMI had terminated.

• If the individual enrolled in SMI during the SEP and later terminated SMI when again covered under a GHP based on current employment, he/she could have another SEP when GHP coverage ended.

• NOTE: This situation could occur any number of times depending only on how often GHP coverage based on current employment was lost and regained. However, to have the subsequent SEPs, the individual must have enrolled during the earlier SEPs.

D. BACKGROUND – WHEN SEP BEGAN

The individual who met the requirements in HI 00805.750A. or HI 00805.750B., had a 7-month SEP that began with whichever of the following resulted in earlier coverage:

• The month in which the individual was no longer covered by a GHP by reason of current employment; or

• The third month prior to the month of attainment of age 70. Under the original amendments, Medicare became primary at age 70 even if the individual continued to work.

No SEP could begin prior to 11/84. However, if an individual met the SEP requirements between 1/83 and 11/84, he/she began a special 7-month SEP as of 11/84.

E. BACKGROUND – WHEN SMI BEGAN

If age 70 was not involved, enrollment during the first month of the SEP resulted in SMI coverage effective with the first day of that month. Enrollment during the balance of the SEP resulted in SMI effective with the first day of the month after the month of enrollment.

If age 70 was involved, enrollment during the 3 months prior to the month of attainment of age 70 resulted in SMI coverage effective with the first day of the month the individual attained age 70. Enrollment in the last 4 months of that SEP resulted in SMI effective with the month after the month of enrollment.

F. BACKGROUND – PREMIUM SURCHARGE ROLLBACK

Only months when the individual was covered under both HI and a GHP based on current employment were excludable in determining the premium surcharge for late enrollment. No months prior to 1/83 could be excluded in determining the surcharge. This provision was effective for premiums beginning with 9/84.