Department of Civil Service

PA94-10

TO: Participating Agency Health Benefits Administrators
FROM: Employee Benefits Division
SUBJECT: NYSHIP Requirements for Medicare Enrollment
DATE: September 30, 1994

The New York State Health Insurance Program (NYSHIP) requires that certain Medicare eligible individuals enroll in Medicare when first eligible. Medicare becomes the primary carrier and the NYSHIP's Empire Plan pays claims as the secondary insurer. These provisions are outlined in Section 610 of the Manual of Procedures for Participating Subdivisions and are included in the General Information Booklet that you issue to your enrollees. As a Participating Agency in the NYSHIP, you are responsible for ensuring that all eligible employees and retirees are properly informed of the benefits available to them. Your agency's employees and retirees are responsible for knowing their benefits, including plan requirements regarding Medicare enrollment.

Before the latest General Information Booklet was issued (1990), a liberal "hold harmless" policy was adopted because the information in the booklet did not correctly reflect the changes that occurred in the Federal laws affecting Medicare eligibility. "Hold harmless" means that the individual will suffer no loss for the inability or failure to enroll in Medicare and the NYSHIP continues to pay claims as the primary payer until the person is next eligible for enrollment in Medicare.

The current General Information Booklet (1990) clearly explains the relationship between Medicare and NYSHIP for retirees age 65 and older and the consequences of failure to enroll in Medicare. Therefore, in the interest of fairness, and to protect the plan from inappropriate costs, the hold harmless provision for retirees age 65 or older and spouses of retirees age 65 will now be extended only to those who are ineligible to enroll in Medicare or to those who, because of documented misinformation from sources noted below, did not obtain Medicare coverage. Otherwise, the Empire Plan insurance carriers will carve out the expenses that would have been covered by Medicare had it been in effect and reimburse any balances according to Plan provisions.

Hold Harmless Policy:
Effective Immediately

Individuals may be held harmless for failure to be enrolled in Medicare only under the following circumstances:

Medicare Part A

The enrollee is ineligible or must pay to be enrolled. In these cases, the hold harmless is permanent unless the Medicare law is changed in the future to allow enrollment at no cost or the individual becomes eligible for premium-free coverage under a spouse's enrollment. (Any late enrollment penalties assessed by Medicare are the responsibility of the enrollee and will not be considered grounds for granting a hold harmless request.)

Medicare Part A and/or Part B

There is written documentation from the source of the error that the individual's failure to enroll in Medicare Part A and/or B is the result of misinformation by the Department of Civil Service, an agency HBA or the Social Security Administration. In these cases, the hold harmless is temporary for the Part(s) in question only until the effective date of Medicare resulting from the next available enrollment period.

All applicants for hold harmless status will be required to appeal Medicare's denial of benefits and/or enrollment to the Social Security Administration and have the appeal denied before we will consider requests to be held harmless.

Exception to Policy

The hold harmless procedure described above will not become effective until July 1, 1995, for disabled retirees under age 65 and the under age 65 disabled dependents of retirees. This is because the literature published for disabled retirees under age 65 and the under age 65 disabled dependents of retirees does not provide a clear understanding of the requirement to enroll for primary coverage in Medicare when first eligible. To correct this, an Empire Plan Report is being prepared that will describe in detail the need for these individuals to enroll in Medicare. This Report will be issued prior to January 1,1995, and will advise enrollees of the next Medicare open enrollment period, January 1, 1995, through March 31, 1995, with coverage effective July 1, 1995. It will inform them that, as of July 1, 1995, the NYSHIP will no longer provide primary benefits to those individuals who are eligible but fail to enroll in Medicare.

Submit your written requests for hold harmless consideration to the Program Services Unit at the Employee Benefits Division at the address provided on this letterhead. Requests must include the documentation required by the policy stated above.

If you have any questions about the application of this policy, please contact your Employee Insurance Representative for assistance.