Reform - Key MIPPA Provisions Part 2

August 14, 2008

Important New Medicare Law Provisions:
a Beneficiary's Perspective (Part 2)

As the Center for Medicare Advocacy has previously reported, both the Senate and the House of Representatives voted on Tuesday, July 15, 2008, to override the presidential veto of H.R. 6331, the Medicare Improvements for Patients and Providers Act of 2008 (MIPPA), Pub. Law 110-275.

This is the second in a series of Weekly Alerts identifying portions of MIPPA that will have the most significant effect on Medicare beneficiaries. Today's Alert focuses on MIPPA provisions explicitly affecting low income beneficiaries, and provisions that change the rules for Specialized Medicare Advantage Plans serving Special Needs Individuals. Most of the provisions reported in this Alert will become effective January 1, 2010.

Provisions Relating to the Low Income Subsidy and the Medicare Savings Programs

Section 112. Application of full Low Income Subsidy Asset Test Under Medicare Savings Program. Beginning January 1, 2010, three Medicare Savings Programs (MSPs) - Qualified Medicare Beneficiary (QMB), Specified Low Income Medicare Beneficiary (SLMB) and Qualified Individual (QI) - will use the Low Income Subsidy asset test of $6,000/individual and $9,000/couple, indexed each year according to the Consumer Price Index. This provision increases the federal level asset test for these MSPs and, for the first time in the programs' histories, indexes the amount. MIPPA makes no change in states' ability to eliminate or increase the asset level for MSPs; the provision merely sets the floor.

Section 113. Eliminating Barriers to Enrollment. This section comprises several elements intended to improve enrollment in both the Part D Low Income Subsidy (LIS) program, administered by the Social Security Administration, and the Medicare Savings Programs, administered by the States.

The Commissioner of Social Security is directed, for each person who applies for LIS, requests an LIS application or is otherwise identified as potentially LIS eligible, to provide information on both LIS and MSP, provide an LIS application, provide information about where the individual can get assistance, including information about State Health Insurance Counseling and Assistance Programs (SHIPs), and make such information and the application available at local Social Security offices.

In addition, the Commissioner must provide training about both LIS and MSP to those SSA employees who will receive LIS applications and must instruct them to help applicants complete the applications.

$48,900,000.00 is appropriated, beginning October 1, 2008, for these purposes and "shall remain available until expended."

Beginning January 1, 2010, the Commissioner must, with the consent of an applicant, transmit data received from the application to the appropriate state for its consideration of the applicant's eligibility for a Medicare Savings Program. The State must act on the data and must consider the date of the application for LIS as the date of application for MSP.

The Commissioner of SSA and the Secretary of the Department of Health and Human Services will enter into an agreement for funding of the various requirements beginning with FY 2011; not more than $3,000,000 per year are appropriated for that purpose.

By January 1, 2012, the Comptroller General of the United States will submit an analysis to the Congress of the effect of these provisions 1) on increasing participation in the Medicare Savings Program and 2) on states and the Social Security Administration.

Section 115. Eliminating Application of Estate Recovery. This section amends Medicaid law to prohibit states from recovering, from the estate of a deceased Medicaid recipient, the value of Medicare cost-sharing paid under a Medicare Savings Program. This provision is effective January 1, 2010.

Note to Advocates: States are not currently required to recover MSP costs from estates but they are permitted to do so. Many states do not. If your state is one that does, you can advocate for it to cease such recovery before the 2010 effective date of this provision.

Section 116. Exemptions from Income and Resources for Determination of Eligibility for Low Income Subsidy. This provision streamlines income and eligibility determinations for LIS by eliminating consideration, as income, of non-financial support provided to an applicant and consideration, as a resource, of the cash surrender value of a life insurance policy. The provision is effective for applications filed on or after January 1, 2010. The provision does not apply to Medicare Savings Programs but under pre-existing law, states have the flexibility to eliminate these and other elements of the eligibility determination process.

Section 118. Translation of Model Form. This provision requires the Secretary to provide for translation of the model MSP application form into at least the 10 languages spoken most often by applicants for Medicare. Effective January 1, 2010.

Provisions Relating to Specialized Medicare Advantage Plans for Special Needs Individuals

Section 164. Revisions relating to Specialized Medicare Advantage Plans for Specialized Needs Individuals. Authority for the existence of Special Needs Plans (SNPs) is extended through the end of 2010 and the moratorium on the Secretary's authority to designate new plans, currently in effect, is extended through 2010.

Each type of SNP – Institutional, Dual Eligible and Disabling Chronic Condition – must, effective January 1, 2010, enroll only individuals who meet the statutory definition of special needs individual for its SNP type.

Institutional SNPs seeking to enroll individuals living in the community but requiring an institutional level of care must use a state assessment tool to determine the need for institutional level of care and must have the assessment performed by an entity other than the organization offering the plan.

Dual SNPs must provide each prospective enrollee, prior to enrollment, with a comprehensive written statement of benefits and cost-sharing protections under the relevant State Medicaid plan and an explanation of which such benefits and cost-sharing protections are available under the plan.

Note to Advocates: This provision, presumably, would allow a prospective dual enrollee to determine if she will receive any value from a dual SNP that is not already available to her under her State Medicaid program. One challenge for those helping individuals make choices is to determine whether the plan has accurately presented State Medicaid coverage, which is not an easy undertaking.

Dual SNPs must also have a contract with the State Medicaid agency to provide, or arrange for the provision of, benefits to which the individual is entitled under Medicaid. Such benefits may, but apparently are not required to, include long-term care services. Those that do not have such a contract, which must be in effect by January 1, 2010, may continue to operate but cannot expand their service areas. The Secretary of the Department of Health and Human Services (HHS) is directed to designate staff and resources to assist States that are inquiring about coordination with Special Needs Plans. But States are not required to enter into contracts with SNPs.

Note to Advocates: These provisions, taken together, suggest that Congress is inclined to have dual eligibles receive all their Medicare and Medicaid services through Medicare Advantage Special Needs Plans. While plans that fully integrate Medicare and Medicaid services have worked well in some situations, these situations have generally evolved with impetus from and a great deal of planning by the states, rather than from private plans.

Severe or Disabling Chronic Condition SNPs. The definition for persons eligible for the services of such SNPs is amended to include having "one or more [co-morbid] and medically complex chronic conditions that are substantially disabling or life threatening, have a high risk of hospitalization or other significant adverse health outcomes, and require specialized delivery systems across domains of care." The Secretary of HHS is directed to convene a panel including the Director of the Agency for health care Research and Quality to determine conditions that meet this new definition.

All SNPs, regardless of type, must meet new requirements for care management. They must have in place an evidence-based model of care with appropriate networks of providers and specialists; conduct an initial assessment and annual reassessment of each individual's physical, psychosocial and functional needs; develop a care plan, in consultation with the individual, as feasible, that identifies goals and objectives and specific services and benefits to be provided; and uses an interdisciplinary team in the management of care. The Secretary of HHS is directed to review each plan's care management compliance as part of a periodic audit.

All SNPs, regardless of type, must meet new data collection and reporting requirements relating to their compliance with the new plan requirements introduced by this law. Such data "may be based on claims data" and must be reported at the plan, rather than sponsor, level.

The requirements relating to SNPs are effective for the 2010 plan year, beginning January 1, 2010. Nothing in the provisions affects benefits to which dual eligible individuals are entitled through their State Medicaid programs.

Section 165. Limitation on Out-of-Pocket Costs for Dual Eligibles and Qualified Medicare Beneficiaries Enrolled in a Specialized Medicare Advantage Plan for Special Needs Individuals. This section prohibits Dual Eligible SNPs (Dual-SNP) from imposing cost-sharing requirements on dual eligibles or Qualified Medicare Beneficiaries that would exceed the amounts permitted under the State Medicaid plan if the individual were not enrolled in the Dual-SNP. The provision is effective January 1, 2010.

Note to Advocates: This prohibition is already effective through pre-existing provisions of both Medicare and Medicaid, as well as extensive guidance from the Centers for Medicare & Medicaid Services on the subject. Moreover, existing protections apply not just to enrollees of Dual-SNPs, but to all dual eligibles, whether in traditional Medicare or any kind of Medicare Advantage plan (regardless of whether it is a SNP). See Weekly Alert of April 24, 2008 for details of this somewhat complicated issue. Advocates should be especially attentive to cost-sharing obligations reported in plan literature for plan year 2009 to ensure that they comport with existing law.

Conclusion

Despite the delayed implementation of most provisions discussed in this Alert, much work related to their implementation can be undertaken by advocates now. Advocates may want to initiate conversations with States Medicaid agencies about new Medicare Savings Program eligibility rules and application requirements as well as about the State's involvement with Special Needs Plans for Dual Eligibles.