A multi-employer group health plan (GHP) that has at least one employer with twenty (20) or more employees may prospectively request to exempt employees of identified employers with fewer than twenty (20) employees from the working aged provision. The small employer exception provision of the MSP statue can be found at 42 U.S.C.1395y(b)(1)(A)(iii) and 42 CFR 411.172(b). Under this provision, multi-employer GHPs may elect Medicare as the primary payer for services provided to working aged Medicare beneficiaries covered through qualified employers participating in the plan that have fewer than twenty (20) employees. Such members and their spouses are not subject to the working aged provision once an exception has been granted as long as the employer continues to meet the requirements for the exception.

To Apply for an Exception

The multi-employer plan/administrator of the small employer should submit all requests for exceptions to the Coordination of Benefits Coordinator (COBC).

Only requests that are considered complete will be evaluated. Incomplete requests will be returned to the insurer/plan administrator for completion and resubmission. In order to be considered complete, the request must be written and addressed to the COBC and contain all of the requirements listed below for each covered individual for whom an exception is being requested:

1. Statement that the plan elects Medicare as the primary payer for identified beneficiaries who are employees of identified employers that qualify for such an exception;
2. The following information for each employee/spouse, for whom the plan is requesting Medicare be the primary payer:
   • A letter from the employer that specifies the number of employees that the employer employs and a statement that the employer does not meet the requirements of the 20-or-more employee provision. The full name, date of birth, and Health Insurance Claim Number (HICN) (or Social Security number (SSN), if HICN is not available) for each employee, their spouse for which the request applies;
   • The employer's name, address, and Tax Identification Number (TIN) or Employer Identification Number (EIN);
   • The name of the insurer, type of coverage and effective date of the coverage for the employer-sponsored insurance.

Plan administrators/insurers should note the following before applying for a Small Employer Exception:

• The COBC cannot make an exception for beneficiaries entitled to Medicare based on permanent kidney failure (End-Stage Renal Disease) or Disability.
  
• The date of the request will serve as the effective date, unless the request is dated more than 7 days prior to the receipt date, in which case, the receipt date will be used.
  
• The effective date for requests that were returned for missing information will be based on the date the completed request is received in the COBC.
  
• When the employer employs a new individual who would be subject to the exception, the plan shall notify the COBC and provide the required information for that individual.
  
• The plan must notify the COBC when the exempt employer meets the 20-employee threshold or when there has been a change in the individual's GHP coverage.
  
• The plan is required to notify each employee/spouse for whom the plan is requesting Medicare be the primary payer.

Mail or fax completed requests to:

Mailed Requests:
Medicare Coordination of Benefits
Attn: Small Employer Exception Request
P.O. Box 660
New York, NY 10274

Faxed Requests:
Address fax to:
Medicare Coordination of Benefits Contractor
Attention: Small Employer Exception Request
Fax # (646) 458-6761

The COBC will provide the plan administrator/insurer with written confirmation after completion of its review and if applicable, processing, of the request. Approved requests will include a listing of the individual(s) whose MSP record(s) and/or Medicare Eligibility file(s) have been adjusted to reflect Medicare as the primary payer.

It is important that the plan/insurer notify each Medicare beneficiary in writing of the date Medicare will become the primary payer and when the employer GHP will pay secondary to Medicare. If the beneficiary is not enrolled in Medicare Part B and wishes to do so, the plan/insurer should advise the beneficiary to contact his/her local Social Security district office as soon as possible, and supply the affected beneficiary with the information required to apply for Part B benefits.

Downloads
MSP Model for Multi-Employer/Multiple Employer (PDF 377 KB)
Related Links Inside CMS
The Medicare Initial Enrollment Questionnaire The Medicare Secondary Claim Development Questionnaire Group Health Insurance No-fault and Liability Insurance Workers' Compensation Beneficiaries' and Advocates' Frequently Asked Questions Health Insurance Reform for Employers
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Page Last Modified: 02/06/2008 1:07:16 PM
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