Two House bills, H.R. 1667 and H.R. 2564, also address the COBRA
bite problem.
Three top House
Democrats and three top House Republicans have found something they can agree
on: Someone should keep Medicare enrollment rules from biting COBRA coverage
users on the neck.
The lawmakers — the Democratic chairs of
three House committees, and the top-ranking Republicans at those
committees — have asked two cabinet secretaries in the administration of
President Donald Trump for help with eliminating the Medicare-to-COBRA
transition trap.
Resources
·
A
California Health Advocates discussion of the Medicare-to-COBRA transition trap
is available here.
·
The
Congress.gov page for H.R. 2564, a bill that would create a special Medicare
enrollment period for individuals moving out of COBRA continuation coverage,
is available here.
·
The
Congress.gov page for H.R. 1657, another bill that would create a special
Medicare enrollment period for individuals moving out of COBRA continuation
coverage, is available here.
·
The lawmakers have
asked the U.S. Department of Health and Human Services (HHS) and the U.S.
Department of Labor (DOL) for:
·
Any data that might be
related to the Medicare-to-COBRA transition trap.
·
Information about any
tools HHS and DOL already have that could help eliminate the trap.
·
Information about any
statutory provisions or other barriers that keep HHS and DOL officials from
eliminating the trap.
The lawmakers who signed the letter are Rep.
Richard Neal, D-Mass., the chairman of the House Ways and Means Committee;
Rep. Kevin Brady, R-Texas, highest-ranking Republican on the Ways and
Means Committee; Rep. Frank Pallone Jr., R-N.J., the chairman of House Energy
and Commerce Committee; Rep. Greg Walden, R-Ore., the highest-ranking
Republican on the House Energy and Commerce Committee; Rep. Robert Scott,
D-Va., chairman of the House Education and Labor Committee; and Rep. Virginia
Foxx, R-N.C., the highest-ranking Republican on the House Energy and Labor
Committee.
The lawmakers who signed the letter addressed
it to HHS Secretary Alex Azar II and DOL Secretary Eugene Scalia.
The Trap
The COBRA coverage continuation program is the
result of an early effort by Congress to regulate commercial health insurance
for people under the age of 65.
The Consolidated Omnibus Budget Reconciliation
Act of 1985, or COBRA, includes a provision that lets many people who have
group health coverage pay the full cost of the benefits, along with a 2%
administrative charge, to keep their group health coverage in place for a
period of at least 18 months.
Today, older workers who leave a group health
plan can sign up for individual health coverage, on a guaranteed-issue basis,
either through an Affordable Care Act (ACA) public exchange or outside of the
ACA public exchange system. Low-income older workers may qualify for ACA
premium tax credit subsidies.
But some older workers, and some younger
workers with disabilities severe enough that they qualify for Medicare due to
the disabilities, still pay for COBRA coverage. Sometimes, they may pay
for COBRA coverage because it’s cheaper than individual coverage. In many
cases, they pay for COBRA coverage because they prefer their existing group
health benefits and provider networks.
In some cases, people who have COBRA
coverage turn 65 without realizing that they should take steps to sign up for
COBRA coverage. COBRA users who fail to sign up for Medicare Part B
physician and outpatient services coverage within eight months of turning
65 may have to pay COBRA late-enrollment penalties, according to a
COBRA-to-Medicare issue summary posted by the National Association of Health
Underwriters.
The House leaders note in their letter to Azar
and Scalia that another, even bigger problem could affect COBRA coverage users
who turn 65 and fail to understand Medicare eligibility rules: They
could face the possibility that huge bills will fall between the coverage
cracks.
Once the group health plans that provide the
COBRA coverage realize that enrollees were actually eligible for Medicare, but
failed to enroll in Medicare, the “group health plans can reevaluate any paid
claims,” the lawmakers write. “As a result, many retirees are unexpectedly
exposed to out-of-pocket liability for any costs paid under COBRA benefits on
or after [the] date of Medicare eligibility.”
The Lawmakers’
Proposed Solution
The lawmakers write in their letter that one
way to solve the problem would be to make the workers who use COBRA more aware
of what might happen if and when they become eligible for Medicare.
Group health plans already have to send
departing enrollees notices about the enrollees’ eligibility for COBRA
continuation coverage.
Some the risk related to COBRA-to-Medicare
transition problems “would be eliminated if COBRA notices addressed the interaction
with Medicare, and vice versa,” the lawmakers write. “Unfortunately, such
information is not required under either Medicare or COBRA, and thus,
transparency and clear information about the interaction between the two is
lacking.”
HHS and DOL should “coordinate and develop
informative and clear communications for affected Americans,” the lawmakers
write.
One thing HHS and DOL could do is to put more
and better information about the issue on their websites, the lawmakers write.
Bonnie Burns’ NAIC
Presentation
Bonnie Burns, a health policy specialist with
California Health Advocates, who has an official post representing consumers in
proceedings at the National Association of Insurance Commissioners (NAIC), has
been working for years to draw NAIC members’ attention to the
COBRA-to-Medicare transition trap.
She talked about the issue Dec. 7 in Austin,
Texas, at a Senior Issues Task Force session at the NAIC’s fall national
meeting.
She gave the example of a woman who ended up
owing her COBRA coverage provider $150,000 in repayments for health care
expenses that the carrier had paid after she stopped working, according to
draft meeting minutes.
The carrier told the woman that Medicare
should have been her primary coverage provider after she stopped working, according
to the draft minutes.
State insurance regulators at the session
suggested that improving coverage notices could help reduce the impact of the
transition problem, and that federal policymakers would have to be the ones to
update the notice rules.
H.R. 2564 and H.R.
1657
Rep. Kurt Schrader, D-Ore., and Rep. Gus
Bilirakis, R-Fla., have tried to solve the COBRA-to-Medicare transition trap
problem by introducing the “Medicare Enrollment Protection Act” bill, or H.R.
2564.
H.R. 2564 could reduce the number of people
affected by the transition trap by creating a special Medicare enrollment
period for individuals who have, or are moving out of, COBRA continuation
coverage.
The bill would also exempt the people making
that transition from the usual Medicare Part B late-enrollment penalties.
Schrader and Bilirakis have lined up two other
Democratic cosponsors and two other Republican cosponsors.
Rep. Lloyd Smucker, R-Pa., has introduced
a similar bill, H.R. 1657, the “Seniors’ Health Care Choice Act of 2016″ bill.
His bill, which has no cosponsors, would create a special Medicare enrollment
period for COBRA users without eliminating the Medicare Part B late-enrollment
penalty.
No comments:
Post a Comment