580           MEDICARE SAVINGS PROGRAMS

What is it?

Medicare Savings Programs help Medicare recipients pay for all or part of their Medicare premiums.

Medicare Savings Programs generally use the financial and non-financial eligibility of the APAAdult Public Assistance and SSISupplemental Security Income programs, except that the resource limits are higher.

Who is eligible?

Medicare recipients who meet income and resource requirements. The Medicare recipient must meet all non-financial requirements for SSISupplemental Security Income/APAAdult Public Assistance related Medicaid (i.e., filing an application, Social Security number, citizenship, residency, assignment of rights) or MAGI Parent/Caretaker Relative category as explained in MAGI MS 816.
 

NOTE:

An individual who is incarcerated is not eligible for any Medicare Savings Programs.

Eligibility for Medicare Savings Programs should be determined at every application, and redetermined at every renewal and whenever a change is reported that may affect their eligibility.

Programs available:

• Qualified Medicare Beneficiary Program (QMB)
• Specified Low-Income Medicare Beneficiary Program (SLMB Base)
• Specified Low-Income Medicare Beneficiary Program (SLMB Plus)
• Qualified Disabled Working Individual (QDWI)

Resource requirements:

For QMBQualified Medicare Beneficiaries and SLMBSpecified Low Income Medicare Beneficiaries, resources must be under $9,090 for an individual and $13,630 for a couple. For the QDWIQualified Disabled and Working Individuals program, resources must be under $4,000 for an individual and $6,000 for a couple (twice the SSISupplemental Security Income resource limit).

Income determinations:

The financial determination is done in accordance with APAAdult Public Assistance methodology except for those requirements that are prohibited by the Medicaid program as described in ADLTC MS 523 and ADLTC MS 524. For a couple case in which one person is eligible and one is ineligible, spousal deeming according to SSISupplemental Security Income rules is required and the poverty level based income standard for a household of two is used.

As in APAAdult Public Assistance income determinations, countable income is used to determine financial eligibility. Countable income is total gross income (not including SSISupplemental Security Income and APAAdult Public Assistance payments), less allowable disregards.

SSASocial Security Administration COLACost of Living Allowance Disregard: The January 1st cost of living (COLACost of Living Allowance) increases in Social Security Title II benefits are disregarded in determining income eligibility for SLMBSpecified Low Income Medicare Beneficiaries until the annual federal poverty guidelines are implemented. This means that COLAs are usually disregarded through March since the new poverty guidelines (FPGFederal Poverty Guidelines) are effective April 1st of each year.

EIS information:

If an individual is determined eligible for a Medicare Savings Plan, it is important that the following steps are completed properly:

1. Enter the verified HICHealth Insurance Claim number on the "HIC Number" field on the MEREMedical Reference screen for an individual who is currently enrolled in Medicare.
    
2. Enter the correct start date on the MCRMedicare line of the MERIMedical Resource Information screen. This date always starts with the first day of the month, and is the effective date of Medicare Part A.
    
3. Enter the "J" resource code on the MCRMedicare line (not the TPRThird Party Resource line) on the MERIMedical Resource Information screen for an individual enrolled in both Medicare Part A and Part B.
    
4. After the case is authorized, email DHCSDivision of Health Care Services at DMATPL@alaska.gov asking that they start the Medicare Savings Program.
    

Premium refunds:

Once a client is enrolled in a Medicare Savings Program, the state assumes liability of the beneficiary's Medicare premiums. The recipient will receive a refund for any Part B premiums deducted or paid for.

Note:

Premium refunds are not counted as income when determining eligibility. They are counted in the post eligibility or nursing home determination, only up to the amount that has been allowed as a medical expense deduction on previous income credits. If prior nursing home credits contained an allowance for the individual to pay the Part B premium, the current income credit must be adjusted to remove that allowance when the State begins paying the premiums.

Medicare Savings Program failures:

Medicare Savings Program failures may be caused by an incorrect HICHealth Insurance Claim # entered on the MEREMedical Reference screen, system logic failures, data transmission problems, conflicts with a Medicare Savings Program from another state, or with conflicting vital data between SSASocial Security Administration and EISEligibility Information System.

If a Medicare Savings Program recipient indicates that they are still being charged a Medicare premium two months after issuance, review the case to ensure that the correct HICHealth Insurance Claim # was entered on the MEREMedical Reference screen and that the Medicare (MCRMedicare) segment on the MERIMedical Resource Information is correctly coded. If the case is correct, report the problem to DHCSDivision of Health Care Services via email at DMATPL@alaska.gov and provide the beneficiary's:

1. Name and case number;
    
2. HICHealth Insurance Claim number; and
    
3. Medicare state date.
    

Note:

A previously authorized Medicare Savings Program only continues on the billing side for one month after the last benefit issuance. This means that if a case approved for a Medicare Savings Program does not issue another month of eligibility within 30 days of the last issuance, the Medicare Savings Program will stop.

If this occurs, email DHCSDivision of Health Care Services at DMATPL@alaska.gov requesting that they restart the Medicare Savings Program. This happens most often at renewal due to late processing.

 580 A.      QUALIFIED MEDICARE BENEFICIARIES ( QMB )

• Pays Part A and Part B premium
• Pays deductible
• Pays co-payments, except for prescriptions
   

To be eligible, countable income must be no more than:

100% of the Federal Poverty Guidelines (FPGFederal Poverty Guidelines). The effective date of QMBQualified Medicare Beneficiaries coverage is the beginning of the month after the month in which the eligibility determination is made. For example, an individual applying on March 30th for QMBQualified Medicare Beneficiaries benefits and found eligible on April 15th will be eligible to begin receiving QMBQualified Medicare Beneficiaries benefits effective May 1st.

EISEligibility Information System Coding:

580 B.      SPECIFIED LOW INCOME MEDICARE BENEFICIARY ( SLMB )  

SLMBSpecified Low Income Medicare Beneficiaries Base:

• Pays Part B premiums

To be eligible, countable income must be no more than:

• 120% of the Federal Poverty Guidelines (FPGFederal Poverty Guidelines)

SLMBSpecified Low Income Medicare Beneficiaries Plus:

• Pays Part B Premiums

To be eligible, countable income must be no more than:

• 135% of the Federal Poverty Guidelines (FPGFederal Poverty Guidelines)

SLMBSpecified Low Income Medicare Beneficiaries benefits begin the month of application. In addition, the applicant may request three months of retroactive SLMBSpecified Low Income Medicare Beneficiaries coverage. In order to qualify for retroactive SLMBSpecified Low Income Medicare Beneficiaries, the applicant must meet all eligibility factors in the months requested.

Note:

The difference between SLMBSpecified Low Income Medicare Beneficiaries Base and SLMBSpecified Low Income Medicare Beneficiaries Plus (aside from the income standard) is the SLMBSpecified Low Income Medicare Beneficiaries Plus is a capped entitlement under federal law. This means there is an annual limit on the amount of money available to pay for the expanded eligibility category.

All individuals applying for coverage of their Part B premiums will have their eligibility determined for SLMBSpecified Low Income Medicare Beneficiaries Plus until the annual spending limit is reached. Once the spending limit is reached, three things happen:

1. Staff will be notified via broadcast with instructions;

2. Eligibility determinations for new applicants revert back to the SLMBSpecified Low Income Medicare Beneficiaries Base category; and

3. Retroactive SLMBSpecified Low Income Medicare Beneficiaries Plus coverage is no longer available.

If spending reaches the annual limit before the end of the calendar year, monthly eligibility determinations for existing SLMBSpecified Low Income Medicare Beneficiaries Plus recipients will continue to use the SLMBSpecified Low Income Medicare Beneficiaries Plus criteria, as the spending on these individuals has already been charged against the annual limit. Any new eligibility determination must be made under the SLMBSpecified Low Income Medicare Beneficiaries Base category.

If staff are notified that the annual spending limit has been reached, caseworkers must send an email to DPAPolicy@alaska.gov with information (e.g., client name, ID number, and household size), and the countable income of an individual who would have been eligible under the 135% level. These individuals will be given preference over any new applicants for SLMBSpecified Low Income Medicare Beneficiaries Plus in the next calendar year, as explained below.

Beginning in January of each year, eligibility determinations return to using the SLMBSpecified Low Income Medicare Beneficiaries Plus criteria. Because of the limited funding, eligibility determinations will be made in the following order:

1. Individuals who were SLMBSpecified Low Income Medicare Beneficiaries Plus recipients in the previous calendar year;

2. Individuals who applied for SLMBSpecified Low Income Medicare Beneficiaries Plus in the previous calendar year, but who were denied because that year's annual cap had been reached;

3. New applicants in the current calendar year; and

4. New applicants for retroactive coverage in the current calendar year.

Retroactive Coverage Limit: For a current year applicant, retroactive SLMBSpecified Low Income Medicare Beneficiaries Plus coverage may not cover any months prior to January.

EISEligibility Information System Coding:

580 C.      QUALIFIED DISABLED AND WORKING INDIVIDUALS ( QDWI )

• Pays Part A premiums

To be eligible, countable income must be no more than:

• 200% of the Federal Poverty Guidelines (FPGFederal Poverty Guidelines)

QDWIQualified Disabled and Working Individuals benefits begin the month of application.

An individual who loses their SSASocial Security Administration disability benefits because of earnings from work, but who continues to have the disabling condition, may continue to receive Medicare coverage if they continue to pay the premiums.

EISEligibility Information System Coding:

  580 D.      LOW-INCOME SUBSIDY (LISLow Income Subsidy) PROGRAM

The Medicare Prescription Drug, Improvement and Modernization Act of 2003 (MMAMedicare Modernization Act) established a subsidy program that provides extra help with Medicare Part D premiums, deductibles, and co-payments. (See Section 506 for more information about Medicare Part D). This Low-Income Subsidy (LISLow Income Subsidy) program is available to Medicare beneficiaries beginning January 1, 2006.

Note:

Medicaid recipients who are Medicare eligible are automatically eligible for and enrolled in the LISLow Income Subsidy and do not need to apply.  This includes Qualified Medicare Beneficiaries (QMBQualified Medicare Beneficiaries), Specified Low-Income Medicare Beneficiaries ( SLMB and SLMBSpecified Low Income Medicare Beneficiaries Plus), and Qualified Disabled and Working Individuals (QDWIQualified Disabled and Working Individuals).

Starting January 1, 2010, LISLow Income Subsidy applications received and processed by the SSASocial Security Administration from residents of Alaska will generate an electronic referral to DPADivision of Public Assistance. Using information from this referral, DPADivision of Public Assistance will send an application form to the individual on which they may provide information needed to determine eligibility for Medicare Savings Programs or other Medicaid categories. The application form may also be used to apply for other DPADivision of Public Assistance programs for which the individual may qualify.

1. Taking the LISLow Income Subsidy Application

The Social Security Administration (SSASocial Security Administration) has primary responsibility for determining eligibility for the LISLow Income Subsidy.  DPADivision of Public Assistance will make an LISLow Income Subsidy eligibility determination only if the applicant specifically requests a state determination.  Medicare beneficiaries must apply for the Low-Income Subsidy (LISLow Income Subsidy) using the SSASocial Security Administration-1020 form, Application for Help with Medicare Prescription Drug Plan Costs.  

DPADivision of Public Assistance staff may assist individuals with completing the application for the subsidy and forward it to SSASocial Security Administration.  When submitting the application to SSASocial Security Administration, follow the instructions below:

• Do not photocopy the SSASocial Security Administration-1020 form.  SSASocial Security Administration electronically scans these applications and photocopying makes the form unscannable, which could delay an SSASocial Security Administration decision.  

• Do not date-stamp.  Enter a hand-written date in the For Official Use Only box using MM/DD/YYYY format.

• Do not fold the application other than where it is pre-folded.  Additional folds may affect scanning.

• Do not send any additional material with the application.  SSASocial Security Administration will contact the individual if more information is needed.

Mail the LISLow Income Subsidy application form to:

Social Security Administration

Wilkes-Barre Data Operations Center

PO Box 1020

Wilkes-Barre, PA  18767-9910

2. When DPADivision of Public Assistance Processes the Application

If an individual insists that DPADivision of Public Assistance make the LISLow Income Subsidy eligibility determination, refer to Administrative MS 126-3 for more detailed instructions.

3. Subsidy Levels

The LISLow Income Subsidy has two basic levels of assistance:

Full Subsidy - is for individuals with annual incomes below 135% of the Federal Poverty Guidelines (FPGFederal Poverty Guidelines) and countable assets below $9,090 for individuals and $13,630 for couples.  These individuals pay no premium, no deductible, and small co-payments up to $7,400 out of pocket costs.

Reduced Subsidy - is for individual with annual incomes below 135% of the FPG and countable assets below $15,160 for individuals and $30,240 for couples.  These individuals pay no premium, a $104 deductible, 15% co-insurance up to $7,400 out-of-pocket costs, and small co-payments after that.

Reduced subsidy also includes individuals with annual incomes between 135% and 150% FPG and countable assets below $16,600 for individuals and $33,240 for couples. These individuals pay a sliding-scale premium, a $104 deductible, 15% co-insurance up to $7,400 out-of-pocket costs, and small co-payments after that.

The level of annual income determines the amount of the subsidy:

• Income at or below 135% of FPG qualifies for a 100% premium subsidy
• Income at 136% and up to 140% FPG qualifies for a 75% premium subsidy
• Income at 141% and up to 145% FPG qualifies for a 50% premium subsidy
• Income at 146% and up to 149% FPG qualifies for a 25% premium subsidy
• Income at 150% FPG qualifies for a 0% premium subsidy
   

See Addendum 1 for the current annual federal poverty guidelines for Alaska.

4. LISLow Income Subsidy Premium Payment Limits

In order to get Medicare Part D coverage, the individual must enroll in a prescription drug plan ( PDP ). The prescription drug benefit is provided through private stand-alone PDP'sPDP'sprescription drug plans. Each plan will contract with certain pharmacies, and may have different costs.  There are seventeen organizations that have plans available in Alaska.  See Addendum 7 - Prescription Drug Plans Available in Alaska.

The maximum amount of the Medicare Part D premium covered by the LISLow Income Subsidy is limited.  See Addendum 1 the standard premium rate that the LISLow Income Subsidy will cover in Alaska.  If an individual chooses a plan that has a premium in excess of this amount, the individual must pay the difference.