CMS Outlines Pre-Enrollment SEP Verification Process, Reaches Out To Those In Both Medicare And Marketplaces

The Centers for Medicare and Medicaid Services has released a slide deck describing in greater detail the process that they intend to use for pre-enrollment verification of special enrollment period (SEP) eligibility. CMS has also begun sending out Medicare periodic data matching notices to consumers enrolled in both Medicare and a marketplace plan, but those notices may be misleading.

How CMS Will Verify Pre-Enrollment Eligibility For Special Enrollment Periods

On June 23, 2017, pre-enrollment verification will begin for new applicants (not already enrolled in marketplace coverage) who claim SEPs for loss of minimum essential coverage or for a permanent move. (Existing marketplace enrollees who attest to a SEP qualifying event are not subject to pre-enrollment verification). In August, pre-enrollment verification will begin for people who claims SEP eligibility for marriage; gaining or losing a dependent through adoption, adoption placement, foster care placement, or a child support or other court order; or Medicaid or CHIP denial. The slides focus on the loss of coverage and permanent move SEPs.

An application for a SEP subject to pre-enrollment verification will create a SEP verification issue or SVI. If consumers attest to more than one SEP qualifying event on a single application, only one SEP will generate an SVI. If multiple household members on one application are all subject to the same loss of coverage or move, their application will also only generate one SVI. If a consumer submits an application and selects a plan under one SEP, generating a SVI, and then submits an application qualifying for a different SEP, generating a second SVI, both SVIs will remain open until the consumer either resolves the first SVI (at which point the second SVI closes); selects a plan under the second application (at which point the first SVI closes); or resolves the second SVI (at which point a plan must be selected within the SEP window).

Consumers who lose minimum essential coverage can usually apply for SEP eligibility and select a plan up to 60 days before or 60 days after they lose coverage. Consumers who move permanently to a new location where a new health plan is available that was not available at their prior location have up to 60 days to apply for SEP coverage and select a plan, but are only eligible if they had coverage for at least one of the 60 days preceding the move or lived in a foreign country or United States territory for at least 60 days before the move. (The prior coverage requirement does not apply to American Indians or Alaskan Natives.) If consumers do not select a plan within the qualifying period, the consumer cannot enroll until the next open enrollment period or until they qualify for another SEP.

Loss of coverage can be verified by one or more documents on official letterhead that clearly identifies who lost or will lose coverage, the date coverage ended or will end, and the type of coverage involved. These may include a letter or bill from an insurer, a letter from an employer, a letter about COBRA coverage, or a letter from a government or other health coverage program. Applicants for a permanent move SEP must submit documents establishing both that they have moved and the fact of prior coverage or residency in a foreign country or U.S. territory. Documents that can be used to prove a move include change of address confirmation from the post office, mortgage or rental documents, bills for financial statement showing a change of address, letters from government organizations, insurance documents, or documents showing a move from outside the U.S. People who are homeless or in transitional housing can send a letter from someone confirming this, together with documentation of proving that person’s own residency.

Consumers who apply for a SEP subject to an SVI choose a plan but will be notified of their need to send (by mail or upload) documents to the marketplace that confirm their qualifying event. They have 30 days to resolve the SVI from the date of plan selection. Their application will be pended until it is resolved, and coverage cannot be used until the SVI is resolved. Once the SVI is resolved the plan and applicant will be notified. The effective date for eligibility will depend on the type of SEP involved, and may be retroactive. If the SVI is not resolved, the plan selection is cancelled. Consumers may not begin using their coverage until they pay their first premium.

A Stricter Approach Than The Current Data Matching Issue Verification Process

The SVI process contrasts with the data matching issue (DMI) verification process, which currently applies when consumers must provide documentation to verify eligibility for exchange coverage or financial assistance. In contrast to the SVI process, consumers who encounter DMIs have 90 or 95 days to submit documentation and may start using their coverage before they send documents.

Consumers who submit a SEP application and select a plan will receive a pended plan selection notice telling them to submit documents within 30 days and which documents are needed. Consumers who apply for an SEP but do not select a plan will receive a reminder notice to select a plan. Consumers who select a plan and whose plan selection is pended but who do not submit required documents will receive an SVI notice, a warning notice 20 days from the end of the 30 day period, and a 15-day warning call.

Consumers who submit documents that are not sufficient to resolve an SVI will receive an insufficient document notice and a call. Consumers whose SVI is resolved will receive a SVI resolution notice, while those whose SVI is not resolved within 30 days will receive a SVI expiration notice. Individuals who are found to have an existing enrollment (such as a previously terminated policy that can be reinstated) will receive an existing enrollment notice, with the SVI closed and the pended plan selection cancelled. In some cases a consumer who fails to resolve a SVI within 30 days may still be found eligible for another SEP that is not subject to pre-enrollment verification and will be enrolled on that basis.

CMS Notice To Consumers In Both Medicare And Marketplace Plans Raises Questions

The Centers for Medicare and Medicaid Services has begun sending out Medicare periodic data matching notices to all consumers who are enrolled in both Medicare and a marketplace plan, including Medicare beneficiaries who are under 65. The notices advise people who are enrolled in Medicare Part A and pay a premium for Part A coverage to compare the cost of the Medicare premium and of marketplace coverage and choose whichever coverage best fits their needs and budget. They advise persons who have premium-free Medicare Part A and who are eligible for or enrolled in Medicare Part B, however, to end their marketplace coverage. The notices state that a person who is receiving Medicare is not eligible for premium tax credits and may have to pay back any tax credits received while enrolled in or eligible for Medicare. They also note that, under a special waiver program now in effect, people who have marketplace coverage but are eligible for Medicare Part B can enroll in Part B up until September 30, 2017.

As noted in an earlier post, the notice may be misleading. Although insurers are not supposed to sell health insurance to consumers enrolled in Medicare, and although persons who are eligible for Medicare are not eligible for premium tax credits, nothing prohibits insurers from renewing marketplace coverage for persons eligible for Medicare, although the consumer is ineligible for premium tax credits as long as the consumer is eligible for or enrolled in Medicare. A number of states do not require insurers to sell Medicare Supplement coverage to Medicare beneficiaries who are under 65, for example persons eligible for Medicare because of disability or persons with end stage renal disease. These persons may be better off with marketplace coverage than with Medicare Part B, even if they have to pay the full premium. On the other hand, if they fail to enroll in Part B in a timely fashion, they may be subject to late-enrollment penalties in the future. The notice fails to explain these options.

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