The Centers for Medicare and Medicaid Services (CMS) within the U.S. Department of Health and Human Services (HHS) is responsible for Medicaid program.

The Centers for Medicare and Medicaid Services (CMS) within the U.S. Department of Health and Human Services (HHS) is responsible for Medicaid program administration at the federal level 2. However, individual state Medicaid agencies administer their own programs on a day-to-day basis.

By: Richa L Frazier

Federal law requires each state to designate a single state agency to administer or supervise the administration of its Medicaid program. This agency, which is usually part of a welfare, health, or umbrella human resources agency, will often contract with other public or private entities to perform various program functions.

State Medicaid agencies have legal obligations to pay Medicare cost-sharing for most "dual eligible" – Medicare beneficiaries who are also eligible for some level of Medicaid assistance. Further, most dual eligible are excused, by law, from paying Medicare cost-sharing, and providers are prohibited from charging them. But the particulars are complex in traditional Medicare and become even more complex when a dual eligible is enrolled in a Medicare Advantage (MA) plan.

It may be helpful to think of dual eligible in two categories: those who are Qualified Medicare Beneficiaries (QMBs) (with or without full Medicaid coverage) and those who receive full Medicaid coverage but whose incomes are above 100% of the federal poverty level, the ceiling for QMB eligibility.

For QMBs, all cost-sharing (premiums, deductibles, co-insurance and copayments) related to Parts A and B is excused, meaning that the state picks up the obligation. The state has responsibility for these payments for QMBs regardless of whether the particular service is also a Medicaid-covered service. States can, but are not required to, pay premiums for MA plans' basic and supplemental benefits.

The "Balance Billing" Q & A referenced above answers the question, "May a provider bill a QMB for either the balance of the Medicare rate or the provider's customary charges for Part A or B services?" with a straightforward, "No."

Providers who bill QMBs for amounts above the Medicare and Medicaid payments (even when Medicaid pays nothing) are subject to sanctions. Providers may not accept QMB patients as "private pay" in order to bill the patient directly, and providers must accept Medicare assignment for all Medicaid patients, including QMBs.

For non-QMB dual eligible, the state's obligation, according to guidance issued by CMS in 2007, is to pay up to the Medicaid rate for Medicaid services "rendered by Medicaid providers" in excess of any third-party liability (such as that of traditional Medicare or an MA plan). In other words, states do not have to pay if the Medicare service is not, a Medicaid service, or if the beneficiary saw a Medicare provider who is not also a Medicaid provider. In addition to this obligation, the Medicaid statute authorizes – but does not require – states to pay providers Medicare cost-sharing for at least some non-QMB dual eligible. It appears from the language of the statute that such payment could include cost-sharing for services not covered in the state Medicaid program

What is the State’s obligation to Medicare Advantage plans regarding the obligations of State Medicaid programs, and the availability of Federal Financial Participation (FFP), for dual-eligible’s enrolled in Medicare Advantage plans?

To properly determine Medicaid liability for Part C cost sharing for a dual-eligible it is necessary to determine the individual’s Medicaid coverage group and the type of Part C cost-sharing. Below is a description of the various coverage groups in which a dual-eligible could be certified.

The chart that follows identifies the Medicaid liability by coverage group and type of Part C cost-sharing. The purpose of the chart is to clarify existing Centers for Medicare and Medicaid Services (CMS) policy by combining material from previously issued guidance.

Individuals who are entitled to Medicare Part A and/ or Part B and are eligible for some form of Medicaid benefit are often referred to as “dual eligible' s.” These benefits are sometimes referred to as Medicare Savings Programs (MSPs). Dual eligible' s are eligible for some form of Medicaid benefit, whether that Medicaid coverage is limited to certain costs, such as Medicare premiums, or the full benefits covered under the State Medicaid plan.

Qualified Medicare Beneficiaries (QMB); Specified Low-Income Medicare Beneficiaries

(SLMB); Qualifying Individuals (QI); and Qualified Disabled Working Individuals (QDWI).

As you can see from the chart, beneficiaries receiving QMB -- the Qualified Medicare Beneficiary program which pays for individuals’ Part B monthly premiums and any premiums, deductibles and co-pays not covered by Part B – should not have any cost sharing in Medicare Advantage plans. However, other dual eligible’ s may have to cover the cost of co-pays, premiums and deductibles on their own if they want to stay in the MA plan. You can get the entire CMS memo and full cost-sharing matrix on the Center for Medicare Advocacy’s website at www.medicareadvocacy.org.

These programs help individuals with Medicare save money each year. Medicare cost-sharing includes Part A and Part B premiums and, in some cases, may also include Part A and Part B deductible, coinsurance, and/or copayment.

The SSA provides that a State Medicaid plan is not required to provide payment for any expenses incurred for a deductible, coinsurance, or copayment for Medicare cost-sharing to the extent that the Medicare payment for the service would exceed the payment amount that would be made under the State Medicaid plan.

In any case where a Medicare deductible, coinsurance, or copayment is required to be paid or may be paid conditionally, the State may limit Medicaid payment, including nominal cost-sharing amounts as permitted under the SSA and specified in the State Medicaid plan. These payment limitations may result in a Medicaid payment of zero.

For individuals with an MA plan, cost-sharing includes premiums plus a deductible and coinsurance, and may include copayment. Additional factors also determine whether Medicaid is liable for coverage of cost-sharing in MA plans. These factors include the dual eligible coverage category, the type of cost-sharing, the options elected by the State, and payment limitations specified in the State Medicaid plan.

Qualified Medicare Beneficiaries (QMB); Qualified Medicare Beneficiaries Plus (QMB+) Specified Low-Income Medicare Beneficiaries

(SLMB); Specified Low-Income Medicare Beneficiaries Plus

(SLMB+) Qualifying Individuals (QI); Full Benefit Dual Eligible (FBDE) Qualified Disabled Working Individuals (QDWI).

A QMB is an individual who: is entitled to Medicare Part A; has income that does not exceed 100 percent of

the Federal Poverty Level (FPL); and has resource that do not exceed three times the

Supplemental Security Income (SSI) limit, adjusted annually for inflation.

A QMB is eligible for Medicaid payment of Medicare premium, deductible, coinsurance, and copayment amounts (except for Part D). A QMB who does not qualify for any additional Medicaid benefits is called a “QMB Only.”

A QMB Plus is an individual who: meets all of the standards for QMB eligibility

as described above; meets the financial criteria for full Medicaid

coverage; and is entitled to all benefits available to a QMB,

as well as all benefits available under the State Medicaid plan to a fully eligible Medicaid recipient.

These individuals often qualify for full Medicaid benefits by meeting the Medically Needy standards, or through spending down excess income to the Medically Needy level.

An SLMB is an individual who: is entitled to Medicare Part A; has income that exceeds 100 percent of the

FPL, but less than 120 percent of the FPL; and has resource that do not exceed three times

the Supplemental Security Income (SSI) limit, adjusted annually for inflation.

The only Medicaid benefit for which an SLMB is eligible is payment of Medicare Part B premiums. An SLMB who does not qualify for any additional Medicaid benefits is called an “SLMB Only.”

An SLMB Plus is an individual who:

meets the standards for SLMB eligibility; meets the financial criteria for full Medicaid

coverage; and is entitled to payment of Medicare Part B

premiums, as well as all benefits available under the State Medicaid plan to a fully eligible Medicaid recipient.

These individuals often qualify for full Medicaid benefits by meeting the Medically Needy standards, or through spending down excess income to the Medically Needy level.

A QI is an individual who: is entitled to Part A; has income that is at least 120 percent of the FPL, but less than 135 percent of the FPL; has resources that do not exceed three times the

Supplemental Security Income (SSI) limit, adjusted annually for inflation.

A QI is similar to an SLMB in that the only benefit available is Medicaid payment of the Medicare Part B premium; however, expenditures for any QI are 100 percent federally funded and the total expenditures are limited by statute.

An FBDE is an individual who:

is eligible for Medicaid either categorically or through optional coverage groups, such as Medically Needy or special income levels for institutionalized or home and community-based waivers; and

does not meet the income or resource criteria for a QMB or an SLMB.

A QDWI is an individual who:

lost Medicare Part A benefits due to returning to work, but is eligible to enroll in and purchase Medicare Part A;

does not have an income that exceeds 200 percent of the FPL;

has resource that do not exceed three times the Supplemental Security Income (SSI) limit, adjusted annually for inflation; and

may not be otherwise eligible for Medicaid.

A QDWI is only eligible for Medicaid payment of Part A premiums.

State Medicaid agency obligations to pay Medicare cost-sharing for QMBs and other dual eligible beneficiaries extend to services provided by MA plans. But exactly how this works is not well understood, likely varies significantly from state to state, and may operate with little uniform methodology. In the traditional Medicare program, a provider files a claim with Medicare, then Medicare, after it has paid its portion, sends the claim to Medicaid for payment of the beneficiary’s cost-sharing. However, if a beneficiary is in an MA plan, the provider does not bill Medicare; the provider bills the plan or receives a capitated payment from the plan. There is no automatic system for billing the state.

CMS says the state can determine the rate but it must reflect, at least, the state’s Medicaid payment for the same service.

MA plan does not have to accept the capitated rate offered by the state, but that plan providers must be able to submit valid claims to the State Medicaid program in order to obtain payment for the cost-sharing.

It notes that this may be problematic as a provider may not be able to identify the plan payment for a particular service, presumably because the provider, itself, may have been paid a capitated rate.

The Capitation Q&A reiterates the message from the Balance Billing Q&A that providers are prohibited from balance billing Medicaid beneficiaries.

MA plans serving dual eligible "must specify in their contracts that dual eligible enrollees will not be held liable for Medicare Part A and B cost-sharing."

For a QMB, Medicaid is responsible for deductible, coinsurance, and copayment amounts for Medicare Part A and Part B covered services. Providers may not bill a QMB for either the balance of the Medicare rate or the provider’s customary charges for Part A or Part B services.

The QMB is protected from liability for Part A and Part B charges, even when the amounts the provider receives from Medicare and Medicaid are less than the Medicare rate or less than the provider’s customary charges, as specified in the Balanced Budget Act of 1997 (BBA).

Providers who bill a QMB for amounts above the Medicare and Medicaid payments (even when Medicaid pays nothing) are subject to sanctions. Providers may not accept QMB patients as “private pay” in order to bill the patient directly, and providers must accept Medicare assignment for all Medicaid patients, including QMBs.

Benefits are coordinated with providers when services are billed to Care

Improvement Plus for reimbursement. At the time of processing, providers are reimbursed for the services rendered under the benefit plan less

any cost share that would normally be due from the member. MHD will pay one-hundred percent (100%) of the Care

Improvement Plus cost sharing* for MO HealthNet participants who are QMB or QMB+ participants - excluding the

coinsurance or cost sharing amount for inpatient nursing facility services (room and board).

The following information may be needed prior to approving your MO HealthNet application:

• Income verification for the past 30 days (i.e. paycheck stubs, letter from employer, federal income tax

return, award letter, etc.); • Immigration documents showing name, immigration status,

registration number and date of entry of those persons applying for MO Health Net who are not U.S.

citizens; and • Medical statement confirming pregnancy and expected date

of delivery (if applying for MO Health Net as a pregnant woman).

States have the option to charge premiums and to establish out of pocket spending (cost sharing) requirements for Medicaid enrollees. Out of pocket costs may include copayments, coinsurance, deductibles, and other similar charges. Maximum out of pocket costs are limited, but states can impose higher charges for targeted groups of somewhat higher income people. Certain vulnerable groups, such as children and pregnant women, are exempt from most out of pocket costs and copayments and coinsurance cannot be charged for certain services.

Premiums States can charge limited premiums and enrollment fees on the following groups of Medicaid

enrollees:

•Pregnant women and infants with family income at or above 150% FPL ($22,065 for a family of 2 in 2011)

•Qualified disabled and working individuals with income above 150% FPL ($16, 334 for an individual in 2011)

•Disabled working individuals eligible under the Ticket to Work and Work Incentives Improvement Act of 1999 (TWWIIA)

•Disabled children eligible under the Family Opportunity Act (FOA) •Medically needy individuals States have the option to impose higher, alternative premiums on other groups of enrollees, if

their family incomes exceed 150% of the federal poverty level. Certain groups, such as institutionalized individuals and most children, are excluded from higher cost sharing.

Medicaid and CHIP provide health coverage to nearly 60 million Americans, including children, pregnant women, parents, seniors and individuals with disabilities. In order to participate in Medicaid, federal law requires states to cover certain population groups (mandatory eligibility groups) and gives them the flexibility to cover other population groups (optional eligibility groups). States set individual eligibility criteria within federal minimum standards. States can apply to CMS for a waiver of federal law to expand health coverage beyond these groups.

Many states have expanded coverage, particularly for children, above the federal minimums. For many eligibility groups, income is calculated in relation to a percentage of the Federal Poverty Level (FPL). For example, 100% of the FPL for a family of four is $22,350 in 2011. The Federal Poverty Level is updated annually. For other groups, income standards are based on income or other non-financial criteria standards for other programs, such as the Supplemental Security Income (SSI) program.

There are other non-financial eligibility criteria that are used in determining Medicaid eligibility. In order to be eligible for Medicaid, individuals need to satisfy federal and state requirements regarding residency, immigration status, and documentation of U.S. citizenship.

Medicaid coverage may start retroactively for up to 3 months prior to the month of application, if the individual would have been eligible during the retroactive period had he or she applied then. Coverage generally stops at the end of the month in which a person no longer meets the requirements for eligibility.

Third Party Liability (TPL) refers to third parties who have a legal obligation to pay for part or all of the cost of medical services provided to a Medicaid beneficiary.

Examples are other programs such as Medicare, or other health insurance the individual may have that covers at least some of the cost of the medical service. If a third party has such an obligation, Medicaid will only pay for that portion.

Patient comes into the doctors office, and he has x, y and z services rendered. A bill is submitted to Medicare for $2,000 Medicare only covered $1,800, of the bill, does the patient pay for the remaining $200 or will Medicaid pick up the balance, if the patients has a spend down that has not been met?

If the patients spend down has NOT been met then the patient will be responsible for the balance of $200.00.

If the member is dual eligible and is a QMB then Medicaid has a program that pays all copays and Deductibles, however this is only after Medicare has been billed and payment issued and this DOES NOT GO TOWARD THERE SPEND DOWN!

Member Johnny went to the doctors office and the bill was $7,000 Medicare was billed and they paid $6,000. The office then billed Medicaid, but he has a spend down, Johnny is also a QMB. So, Medicaid picks up the remaining balance of $1,000, however this DOES NOT GO TOWARDS HIS SPEND DOWN.

MHD-Missouri Healthnet Division FPL-Federal Poverty Level Medically Needy-There is a Medicaid eligibility category for which individuals may

qualify by spending down, that is, the costs of health care that an individual has incurred are deducted from the income that an individual receives in determining whether he or she qualifies for Medicaid. The spend-down approach applied is the Medically Needy Program. Medically needy means aged, blind, or disabled individuals or families and children who are otherwise eligible for Medicaid and whose income is above the prescribed limits for categorically needy, but within the limits set forth by Social Security Administration.

MA-Medicare Advantage CHIP- Children's Health Insurance Program Capitation-Payments agreed upon in a capitation contract by a health insurance

company and a medical provider. It is a fixed, pre-arranged monthly payment received by a physician, clinic or hospital per patient enrolled in a health plan with a capitated contract. Monthly payment is calculated one year in advance and remains fixed for that year, regardless of how often the patient needs services.

SSI-Supplemental Security Income