AUDIENCE: BA, BATA, CCDIPS, ER, LCC, RECONR, EE, EHS, EIE, IES

The Social Security Act provides that health insurance coverage based on a disability will end if such disability ends. The termination is effective with the end of the month after the month in which the beneficiary is notified that his or her entitlement to benefits will end; except, where the beneficiary completed a TWP, is engaging in substantial gainful activity (SGA) but has not medically recovered. In this instance, the individual could have HI coverage through the TWP and for at least 93 months following the last month of the TWP, even though monthly benefits are not payable.

This aspect of the law allows health insurance coverage in some cases to extend beyond the last month of benefit entitlement. It also creates a need to determine and record variant termination dates on the MBR. That is, both current and future termination dates.

A. Determining the Health Insurance Termination Date

The termination date of HI coverage is defined as the 2nd month after the month in which the beneficiary is notified of the termination of disability benefits or the month in which monthly benefits are stopped, whichever is later. If benefits end because of SGA following the TWP, follow procedures in HI 00820.025A. to determine the HI termination date.

For processing purposes, however, determining the correct termination date involves more than the date of notification and the date of termination of benefits.

Disabled beneficiaries become entitled to health insurance in the 25th month of entitlement to a disability-based benefit. They are effectively enrolled and either billed for or have premiums deducted from benefit payments in the 24th month of entitlement. These beneficiaries are selected for enrollment and the MBR is annotated with HI and SMI entitlement information in the 21st month of benefit entitlement. Consequently, when a disabled beneficiary has reached this point of benefit entitlement, any action to terminate benefits will also involve action to terminate or block health insurance coverage.

An individual who has not reached the 25th month of entitlement to a disability-based benefit cannot be entitled to HI/SMI coverage, unless the only reason for termination of the disability benefit is death occurring in the 25th month. In that event, Medicare coverage is awarded for the month of death only. Further, whether or not benefits are stopped, if the individual is notified of the termination in or before the 24th month of entitlement to a disability benefit, HI/SMI coverage will not exist. However, even if the disabled individual is not notified and action is not taken to stop benefits prior to or equal to the 25th month of entitlement, SMI coverage will extend to the month in which benefits are terminated. The HI award, however, must be reversed. See SM 00850.310 for processing instructions. SMI coverage will extend to the month in which benefits are terminated.

The correct HI/SMI termination date is determined by using the following factors:

1. the date of notification, and

2. the operating month in which the benefits are stopped, and

3. the number of months of entitlement to a disability-based benefit at the time of the termination action.

If the termination notice was sent prior to the current operating month (COM) and the beneficiary is in his 25th month of disability as of COM, HI/SMI data will have been annotated to the MBR. See SM 00850.310 for processing instructions. If the termination notice was sent prior to COM and the beneficiary is disabled for more than 25 months, the HI/SMI termination date will be 2 calendar months following the month the termination notice is sent or the date of suspension or termination (DOST), which ever is later. The following chart may be used to determine the proper HI/SMI termination date.

B. Recording the HI/SMI Termination Dates

The Disability Cessations and the Manual Adjustments, Credit and Awards Processes (MADCAP) programs are used to process disability cessation actions for disabled beneficiaries who have HI/SMI involvement. HI/SMI involvement means that the disabled beneficiary has reached the 22nd month of entitlement to a disability-based benefit and HI/SMI enrollment information has been annotated to the MBR.

The Disability Cessations program is restricted to use only by the Office of Disability Operations and the Disability Determination Services for disability cessation actions for disabled wage earners. This is an automated process which will terminate benefits and record the termination on the MBR. It will also automatically determine, for those beneficiaries with HI/SMI involvement, the correct HI/SMI termination date and record such dates on the MBR as well. The Disability Cessations program produces three different documents; i.e., the Form SSA-3926-C2, a 5 ×8 future month diary alert, and a 5 ×8 exception alert. All three will display the date of termination of HI and/or SMI (DOTH and DOTS). They will also display the current premium due amount (CPDA) on record at the time the termination action is taken. The Office of Disability Operations will use this information in their notice to the beneficiary that benefits were or will be stopped. Their notice will be the only notice of the termination of health insurance entitlement and of any premium arrearage or overage existing at the time of the termination.

(See HI 00820.110 for an explanation of when the SALT and TATTER programs will terminate HI/SMI.)

There is no automated facility for terminating disabled adult child (DAC's) or disabled widow beneficiaries (DWBs) when disability ceases. Disability cessation termination actions for these beneficiaries must be processed through the MADCAP program. When there is HI/SMI involvement, RID 6 must be coded as follows.

When the date of termination to health insurance (as determined by the chart above) is equal to the last month of benefit entitlement, RID 6 of the MADCAP summary form must contain the BIC, the appropriate entry in the HI termination date (HTD) field, and an HI option code (HOC) of “C.” Additionally, if the beneficiary is entitled to SMI, the appropriate entry must be coded in the date of termination to SMI (DTS) field and an SMI option code (SOC) of “C” entered.

When the date of termination to health insurance (as determined by the chart above) is later than the last month of entitlement to benefits (i.e., a future month at least 2 months beyond the current operating month), RID 6 of the SSA-2795-U3 must contain only the BIC, a “D” in the reason for future termination (RFT) field, and the appropriate date in the DTS field. Do not code the SOC, HOC or HTD fields.

The coding of the RFT of “D,” indicating HI/SMI termination due to disability cessation, will cause the following data to be recorded on the MBR by means of internal systems processing:

1. the date entered in the DTS field of the SSA-2795-U3 will be posted in the future withdrawal or termination date (FWTD) of the MBR; and

2. the entitlement LAF of the record will be changed to “U”, indicating that health insurance coverage is continuing beyond the last month of benefit entitlement; and

3. the benefit termination of LAF “T-8” will be posted in the work identification code (WIC) position of the history field; and

4. when the date shown in the FWTD field is reached, this date will be posted in the DOTH and DOTS fields and the LAF of record will be changed from “U” to “X-7,” indicating that health insurance has been terminated. This is done in a subsequent action in which the Regular Transcript and Attainment Pass (RETAP) program selects the accounts in the month immediately preceding the month displayed in the FWTD field and passes the records to the Transfer and Termination (TATTER) program for processing. That is, the TATTER program is the facility through which the “future” HI/SMI terminations are effectuated.

ODO will receive no folder documentation subsequent to the termination and credit action; the Form SSA-2795-U3 is the record of such action. However, program service centers 1 through 6 will receive 5 ×8 informational forms indicating whether the HI/SMI termination was processed.

The TATTER program will produce an informational containing an MBR printout for HI/SMI terminations which are non-processable. However, this situation should be encountered infrequently as the RETAP selection and TATTER program actions are based solely on the information present on the MBR. Therefore, all factors for total processing should be in concert.

When a nonprocessable condition is encountered, however, the informational will be produced and carry the following entries: “Disability Cess,” A/N and BIC, the words “Nonprocessable HI/SMI Term,” plus the month and year the termination should have been effective. These informationals will be directed to the Health Insurance and Inquiries Examiner for processing through MADCAP.

C. Beneficiary Notification

Beneficiaries whose helath insurance terminates as a result of their termination of disability benefits must be informed of the status of their HI /SMI coverage as a result of such benefit termination. This includes disabled W/E's disabled adult children, disabled widows, and deemed disabled widows. However, there is no need to include a statement in the beneficiary's notice regarding HI/SMI status, unless the beneficiary has reached the 22nd month of disability benefit entitlement or the beneficiary is a deemed disabled beneficiary.

In the case of the disabled beneficiary (other than deemed DWB) who has at least 22 months of disability benefit entitlement but has not yet been enrolled in HI and/or SMI, the notice must inform the claimant that he is not eligible for HI/SMI coverage because entitlement to a disability-based benefit ended.

Where the beneficiary has been enrolled in HI/SMI (has reached the 25th month), he or she must be informed of the month in which HI and/or SMI will end. The claimant should also be told (if applicable) that SMI premium liability extends through that same month.

For deemed DWB beneficiaries, the date of entitlement to disability (DOED) will have been recorded on the MBR. The beneficiary will have been told of the impending or accomplished HI/SMI enrollment. Therefore, this individual must be told that either HI/SMI eligibility ends or that HI/SMI entitlement ends, whichever the case may be.

This information must be added to the appropriate notice and released as expeditiously as possible because, since as notice above, the HI/ SMI termination dates are dependent on its release.

D. Extending the Period of HI/SMI Coverage

There may be instances where a LAF code of “X7” has been established in the belief that the beneficiary was properly notified of his or her disability cessation when, in fact, the notification was either delayed or never sent. Since HI/SMI coverage must remain in effect until after the beneficiary has been notified, it is necessary to either correct the date of HI /SMI termination on the MBR or to change the LAF status from “X7” to “U.”

If the notice has been sent, the “X7” LAF is correct and it is only necessary to extend the HI/SMI coverage. This can be accomplished through the MISCOR CIP R facility by coding the appropriate DOTH and DOTS entries.

If the notice has not been sent prior to COM, the MBR LAF must be changed from “X7” to “U.” This shall be accomplished by processing a conditional adjustment through MADCAP. Include a one-line summary in RID 5 showing the BIC, the monthly rate, the termination month in the “from” column, “CON” in the “to” column, and the appropriate RFD and WIC, e.g., an RFD of “T” and a WIC of “8.” The HI/SMI coding in RID 6 must contain the BIC, SOC of “Y,” HOC of “E,” and RFWT of “D,” the appropriate DOTS entry and a DOES and DOEH equal to those currently present on the MBR.

If third party buy-in information is received for a terminated beneficiary who originally refused SMI, the coverage period must be recorded on the MBR, provided the buy-in begins before the HI was terminated. For example, the A beneficiary is in LAF X-7 effective 8/77. Information is received that a buy-in was effective 3/76. Therefore, code the RID 5 as shown above and the RID 6 with a BIC of A, SOC of C, DES of 3/ 76, PBC of 050, TED of 3/76, TTD of 7/77, DTS of 8/77, and SEC of S. Notify the beneficiary of the closed period of coverage.

E. HI/SMI Terminations for Deemed Disabled Widows Where Monthly Benefits Are Continuing

If the disability of a deemed disability widow beneficiary (DWB) ceases, the HI /SMI eligibility or entitlement of that beneficiary must end even though benefit entitlement continues. Processing HI/SMI terminations on these E and D records will be accomplished either through the MISCOR CIP K facility or the MADCAP program.

MISCOR CIP K must be used if the DOED has been recorded on the MBR but, according to the DOED, the beneficiary has notbeen reached the 21st month of disability as of the month the HI/SMI termination is taken.

The MADCAP program must be used when the beneficiary is in or beyond the 21st month of disability as of the month in which the termination is taken.

Notification that a deemed DWB's disability has ceased will be received via Form SSA-833-U5 as provided in PEM 1880.06 for regular disabled widows (BIC W). All aspects of the disability will have been developed when the HI/SMI termination disability cessation determination is received. The month and year, although not always material, will be in item 10(A) of the Form SSA-833-U5.

1. TERMINATION OF HI/SMI PRIOR TO THE 21ST MONTH OF DISABILITY

If the beneficiary has not reached the 21st month of disability by the month in which the disability cessation HI/SMI termination is to be effective, termination can be processed through the MISCOR CIP K process. This is because the beneficiary has not yet had HI/SMI data posted to the MBR. The removal of the DOED from the record will effectively block any such annotation action. SM 00613.000 ff provides the necessary instructions for completing the Form SSA-3100, Disability Data Coding Sheet, for this purpose.

Send an HI/SMI exhibit 22 to the beneficiary (see NL 00703.622). It requires 2 fill-ins. Include the month and year the disability-based benefit will end in the first paragraph. This can be retrieved from item 18(A) of the Form SSA-833-U5. The second fill-in is the type of benefit to which the beneficiary will continue to be entitled (i.e., retirement, mother's or widow's benefits). The fill-ins must be supplied to the typist.

2. TERMINATION OF HI/SMI IN OR AFTER THE 22ND MONTH OF DISABILITY

If a beneficiary has reached the 22nd month of disability in the month in which the disability cessation HI/SMI termination is being effectuated, the termination must be processed through the MADCAP program.

Send a HI/SMI exhibit 21 to the beneficiary (see NL 00703.621.) It requires 3 fill-ins. The first fill-in is the date, month and year, in which the disability-based benefit will end. This data can be retrieved from item 18(A) of the Form SSA-833-U5. The second paragraph also requires a fill-in. This will be the last month of HI/SMI coverage. Also, the second paragraph may have to be altered by deleting the second sentence if the beneficiary does not have SMI coverage. The third fill-in will be the type of benefit to which the beneficiary will continue to be entitled. That is, retirement, mother's or widow's benefits. Provide the appropriate fill-ins to the typist.